The Changing Role of the Firm

The history of technological change is not only a story of scientists, inventors and laboratories, but also a story of firms and entrepreneurs. The firm has always been the place where decisions were made, initiatives were taken, and ideas turned into real products. Even if this is true today, there have been important changes in the way firms play this role. Differentiation and specialization tendencies have made that innovation is now, more than in the past, the result of organized interactions between formally independent firms. The result is an overall increase in the complexity of innovation processes in the economy, requiring new organizational capabilities. This chapter discusses the changing role of the firm in innovation processes and the way this has been reflected in academic and management literature.

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