Boundaries of R&D collaboration

• Boundaries of R&D collaboration are studied in terms of qualitative case analysis.
• The boundary theories applied are competence, efficiency, power, and identity.
• Competence facilitated by trust enables learning and improves efficiency.
• Competence and efficiency explain boundary setting more than power if trust is high.
• Identity-based boundary setting tends to dominate in a status quo.

Building on organizational boundary theories (competence, efficiency, power, and identity), this study examines the boundaries of R&D collaboration, based on a qualitative, comparative case analysis of six long-term R&D relationships within the supplier network of a leading multinational corporation that manufactures electrical devices and systems. The results reveal that competence development, facilitated by trust, enables joint learning and the creation of tacit knowledge in long-term partnerships, and has a central role in boundary formation. Competence and accumulated experience also improve the efficiency of the relationship, which has a central impact on decisions to continue or end the collaboration. Power conception, drawing on resource dependency theory, is dominant in boundary setting only in cases where trust or mutual dependence between partners is low. The boundaries set by identity are based on managerial sensemaking and prior experience, and they tend to be dominant for as long as external demands force managers to re-consider them. First, the study contributes to supplier involvement literature by utilizing firm boundary theories in the context of R&D collaboration. Second, the study contributes to firm boundary literature by complementing the theory with trust and joint learning approaches, and by examining the interplay between different theories. The results also suggest practices that should be at the forefront of managers' thinking when they consider their firms' relational development needs in the context of R&D collaboration. The results also highlight the importance of long-term experience and trust in facilitating collaboration in the relationship.