Research On Governance Of Technical Standardization Alliance Of Hi-tech Enterprises

With the accelerating of globalization and the fast development of information and network technologies, the technical standard has become the most important competitive factor in high-tech industry and it is getting more and more integrated with patent. This trend enhances the inter-firm R&D cooperation, the protection of intellectual property rights (IPRs) and the cooperation of technical standard innovation among the hi-tech enterprise based on their standardization strategy all over the world and stimulates the formation of technical standardization alliance through contracts, aiming at setting and diffusing technical standard. With its remarkable synergy effect, the technical standardization alliance helps the high-tech firms obtain the complement technologies, set technical standard and get competitive advantage, reduce R&D risk and improve self-determination innovation abilities. However, it is not the nature for the technical standardization alliance to have the synergy effect; the key factors are related to the effective governance of the alliance. The governance of the technical standardization alliance aims to solve problems, which are how the autonomic units with special assets (mainly IPRs) cooperate to accommodate, coordinate oneself to others and guarantee their transactions under the condition of environment uncertainty and task complexity. It is not enough for the corporation governance theoretical system to explain and solve the technical standardizaton alliance problems. In order to develop the technical standardization alliance and make this economic system work stably, it is important and necessary for us to reestablish governance structure and mechanisms for the alliance. From the IPRs governance perspective and based on various theories and methodologies, this paper tries to establish a theoretical analysing frame. Main points are as follows:First of all, the paper advocates that the new property rights (mainly IPRs) contractual relations in technical standardization alliance should be first analyzed, for knowledge and IPRs are the key elements the alliance members invested. The technical standardization alliance is essentially a new property right contractual alliance. Based on the transaction cost economics, patent economics and theory of network externality, the paper explores the incompleteness of the transactions in alliance. From the two aspects: information asymmetry and"Lock-in"effect, the paper analyzes the possible opportunism behavior in a technical standardization alliance, such as converse selection, moral risks ("Free- ride","Hold-up"), strong or weak"lock-in", and reveals that why the technical standardization alliance needs governing.Then, a theoretical analyzing frame is established for technical standardization alliance governance. Based on theories of network governance and characteristics of technical standard, the paper defines the concept of governance of technical standardization alliance of hi-tech enterprises as"through a set of institutional arrangements, distributing the rents reasonably, and coordinating their rights and responsibilities among the alliance stakeholders, in the purpose of maximizing the alliance's rents and protecting every stakeholder'rights", and the stakeholders persue the goal through negotiation. Also the paper points out the governance main bodies and objectives and the governance boundary of the alliance. By building a game model, we show that the essential character of technical standardization alliance governance is common governance, since cooperating to create value and share the returns. From the perspective of stakeholder theory and system sciences, the way to realizing the common governance is that the alliance members who are independent, also interdependent, get cooperating or competitive relations with each other, interact with each other and at last get synergy effect. Relations, interactions and synergy is the governance logic of technical standardization alliance. The common governance instruments include optimizing the governance structure and the governance mechanisms.Thirdly, systematic analysis with transaction cost theory, resource-based theory, ability theory and social network theory shows that the asset specialty, the firm's resource and ability, uncertainty, transaction rate and IPRs protection institutions are the determinants for technical standardization alliance to select its governance structure, and quasi-market contractual governance structure is relatively a optimal choice. After deep description of the alliance's operating procedures and processes, we discuss the property rights and responsibilities of every level and their principal-agent relations in governance structure of the alliance. Moreover the efficiencies of the quasi-market contractual governance structure is analyzed as reducing transaction cost, maximizing the alliance profits, being strategic agility and remedy of the IPRs protection insufficiency by law.Based on the definition of concept of governance mechanism, the paper constructs a governance mechanism system for technical standardization alliance, including two levels: one is macro-level behavior regulations, which are trust, reputation, collective sanction and cooperative culture; another is micro-level operating rules, which mainly are negotiation, the profit transfering, knowledge share and learning, and information leak. For the IPRs character of technical standardization alliance we put more emphasis on micro-level mechanism. Non-complete common interest group cooperation & game theory is applied to construct game models to reveal the connotation, the operating principle of each governance mechanism, and proposes and suggestions are given for hi-tech enterprises and the alliances. The paper argues that the negotiation among members is the most important mechanism in technical standardization alliance, and the member's negotiation abilities determine the consortium rent distribution. The paper also proposed that governance mechanism is the guarantee of alliance proper operation and improvement of cooperation performance.Finally, a case study is conducted. We select a typical, relatively effective and efficient technical standardization alliance—TD-SCDMA industry alliance as the empirical object. It is an inter-firm alliance aiming at setting and commercializing the third generation mobile international standard and its core members are Chinese companies. We discuss and explore its governance problems, governance structure and governance mechanisms to examine the ideas and points proposed above on governance of technical standardization alliance and sum up the achievements and experiences. The case study shows the strategic roles of IPRs and dominant companies has deep explanatory power for Chinese companies to implement industrial and national standardization strategy. Then policies and suggestions are put forward for development and efficient governance of technical standardization alliance, and improvement of high-tech industrial technological progress.