Strategic Innovation Search by Firms in Weak National Systems of Innovation: The case of the Jordanian Generic Drug Industry

This paper examines why and how some firms embedded in weak National Systems of Innovation out-perform others in their innovation performance. It investigates how strategic practices associated with participation in international collaboration, specifically strategic search, contribute to different types and degrees of innovation. The research is an exploratory study. It is based upon an innovation survey of 17 local pharmaceutical firms in Jordan, and detailed case studies of the four leading firms. It identifies how the firms perform strategic search for international collaboration, and how this influences the innovation performance. A key factor influencing the degree of participation in international collaboration is management pro-activeness in the search and sensemaking process. Informal and direct sense-making appear to be more important than formal sense-making in explaining differences in terms of the firms’ participation in international collaboration. Informal and direct sense-making facilitate firms to participate in highly integrated deals such as joint ventures and RandD acquisition, which are associated with higher innovation performance. In addition, the research identifies specific organizational practices that support greater senior employee involvement and integration during strategy decision- making contribute to improved international collaboration and innovation performance.