Managing the strategic network relations between corporate R&D and business

The present paper addresses the important issue of the management of the strategic network relations between corporate R&D and business. In a large technology-based multinational company (+/- 30,000 employees) an instrument that provides regular feedback to both corporate R&D and business about strategic alignment, based on factors derived from the social capital theory and the competence perspective, has been tested in a longitudinal survey from 1997 through 2002 (696 respondents). It is concluded that a combination of both theoretical perspectives adds to a more in-depth understanding of the mechanisms at work in the complex R&D-to-business relations in large divisionalized companies. The improved network communication based on structured feedback related to the level of R&D competencies as well as the level of R&D flexibility and information lead to better strategic alignment. It was further concluded that a governance structure that effectively balances the short-term orientation (via business unit funding) and the long-term orientation (via technology board funding) is effective to provide strategic alignment between R&D and business. Key words: R&D and innovation strategy, social capital theory, competence perspective, strategic alignment