Join the club : entrepreneurial SMEs and collaborative R&D networks

Collaborative R&D networks in Australia are explored through a comparison of case studies of seven such “clubs”. The paper addresses the research question: what are the conditions and mechanisms that facilitate the engagement of entrepreneurial SMEs with R&D and innovation? A typology of these networks is presented, based on whether an R&D network involves large firms or SMEs and whether they were government-initiated or industry-initiated. Each of the R&D clubs studied was treated as a multiple member network (as distinct from joint ventures or other forms of inter-firm R&D partnership) with three basic elements: actors, activities and resources. In the case studies, it was found that large firms tend to initiate collaborative networks themselves, while SMEs most often form such networks as a result of government initiatives, but in all cases the choice of R&D projects was industry driven. The larger firms tend to form more enduring collaborative networks which appear to be more effective in meeting the R&D needs of their members. Not many SMEs undertake R&D and when they do it is often the result of some government intervention. Three problematic issues for SME R&D performance were identified to be poorly developed absorptive capacity, a lack of critical resources (notably of finance and key human resources), and selection of appropriate R&D projects. It is concluded that the cases indicate that industry-driven collaborations are effective in achieving innovative outcomes for the firms involved, and for SMEs if the capacity and resource constraints are understood then a variety of mechanisms for effective collaboration can be developed