A conceptual approach to the dilemma of R & D integration: Further insights into the innovating entrepreneur’s toolkit

Abstract

In an age of deep crisis and uncertainty, those entrepreneurs who think of difficulties as chances hold the key for a way out. Innovation, as a result of R&D investing, is one of the items in their toolkit. Unfortunately, even though decision-making on the area of vertical integration has been extensively studied, there is no agreement yet about the effects of uncertainty on the optimal degree of R&D integration. Consequently, entrepreneurs wishing to innovate are missing a sound criterion to choose the governance form for their project. Some authors claim that the reason for this is that the research conducted so far on the relation between uncertainty and R&D integration is incomplete. We provide further support to this claim by putting forward a model that reconciles the most important results discussed in the available literature. After reviewing the main past contributions available, we highlight the most significant variables driving decision-making on R&D integration in the face of uncertainty, and we discuss their mutual interrelations. We argue why and how specificities comprise key factors in this regard.