Global R&D organization and the development of dynamic capabilities : Literature review and case study of a Chinese high‐tech firm

Purpose – How does the internationalization of R&D influence the development of dynamic capabilities? Based on the observation that Chinese high‐tech companies internationalize parts of their R&D activities to Western countries before they have established sound domestic R&D capabilities and in opposition to other held beliefs about internationalization drivers this paper aims to investigate the role of global R&D organizational structure in the development of dynamic capabilities. Design/methodology/approach – This research is based on a qualitative case study using data of one Chinese high‐tech firm to develop testable propositions. Findings – The research develops three main propositions: the loss of competitive advantage and relevant capabilities in the domestic market is more important to the internationalization of R&D than an attempt to enter new international markets; in joint development teams with a partner company, a functional R&D team sub‐structure using heavyweight or autonomous teams leads to a higher degree of knowledge exchange in the partner sub‐project organization; R&D projects conducted in organizations with higher formal control lead to a higher degree of learning than R&D projects conducted when control is shared with a partner; R&D projects which rely extensively on external knowledge (with no formal control) produce better outcomes for learning than projects conducted under joint control; R&D projects which rely extensively on external knowledge (with no formal control) produce better outcomes for learning than projects conducted in full control. Research limitations/implications – As the research is based on data of one single case study there are several inherent limitations regarding validity and reliability which need to be covered by future research. Originality/value – This paper posits that R&D internationalization has a positive influence on the development of dynamic capabilities.