International evidence on R&D services outsourcing practices by technological firms

This paper aims to, through the disintegration of the innovation process in this paper, attempt to shed light on what are some of the distinctive features of this phenomenon, such as: Who is outsourcing R&D? What types of R&D services are being outsourced across the R&D value chain and to whom? Where are firms outsourcing these services? and Why do firms decide to outsource them? Outsourcing practices of some stages of the R&D process to specialized providers have been gaining momentum during the past years even by firms operating in high-tech sectors.

The data used in this paper stem from an original international survey on R&D services outsourcing. This survey includes a sample of 182 US and European Union firms competing in technology-intensive industries.

This study provides evidence of the existence of a global outsourcing market that covers practically all the R&D stages and is widely used by technological firms. However, it highlights the importance of multinationality to be able to use R&D outsourcing as a tool for value creation.

Despite the relevance of this phenomenon, previous studies tend to analyze the R&D function as a whole. However, through the disintegration of the innovation process, this paper provides original international data which helps to analyze the real magnitude and scope of this R&D offshore outsourcing process at the transactional level.