Globalization of research not so new after all

You read a lot these days on how firms active in multiple country-markets have to carry out their R&D in country-markets abroad. Among Japanese, American and European firms, European firms lead the field in terms of what percentage of R&D is carried out in "foreign" locations, followed by U.S. firms then Japanese firms. Whatever the rankings, it seems likely that the overall percentage of foreign R&D is likely to increase. Foreign R&D is hardly a new thing, though:

The book Birth of a Salesman, which describes the history of selling in the United States, reminds readers that Singer, a U.S. manufacturer of sewing machines, was already doing this in the 1800s:

"Many of the important innovations in the company's marketing strategy came from its offices in Britain and then were imported to America in the years after the Civil War.*"

This was partly due to the fact that the company had patent protection in its home market but not in the U.K. market. In a word, the U.K. market was more competitive, resulting in more innovation.

Here in Taiwan, the local banks, which were protected for many years, are going through turmoil as the more competitive foreign banks, armed with their accumulated knowledge in competitive markets, pile on the pressure. Catch up is slow for these Taiwanese banks because the technology (here, experience) is intangible. But catch up they will do!


* This was taken from:

Andrew C. Godley, "Pioneering Foreign Direct Investment in Britain," Business History Review 73 (Autumn 1999), pp. 414, 416-423.


innovation management in Asia