1. LOOKING THROUGH THE KALIDESCOPE: MEASURING TECHNOLOGICAL CAPABILITY AND PERFORMANCE.
- Author
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Coombs, Joseph E. and Bierly III, Paul E.
- Subjects
TECHNOLOGICAL innovations ,COMPETITIVE advantage in business ,MANAGEMENT information systems ,TECHNOLOGY ,TECHNOLOGICAL literacy ,COMPETITION ,INTELLECTUAL property ,INFORMATION science ,INDUSTRIAL management ,KNOWLEDGE management - Abstract
Does the development of firms' technological capabilities lead to high levels of firm performance? Intuitively, this question seems straightforward and the answer is simple - yes, of course. However, this relationship is actually very complex and confusing. Researchers have not been able to consistently find empirical support for this "simple" relationship. Both constructs, technological capability and performance, are multidimensional, complicated constructs, each with many different measures, but neither with a single comprehensive measure. The objective of this study is to illustrate the complexity of this relationship and explain why the use of different measures can lead to dramatically different results. In this study, we analyze the technological capability-performance relationship in 219 large US public companies. A variety of patent statistics are used as indicators for technological capability. The following six measures of performance are used as dependent variables: return on assets, return on equity, return on sales, market value, market value added (MVA), and economic value added (EVA). The results are very different, and at times contradictory, depending on which measures are used for the independent and dependent variables. A detailed understanding of the shortcomings of each type of measure is needed to explain why these differences exist. [ABSTRACT FROM AUTHOR]
- Published
- 2001
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