Outsourcing R&D: a review, model, and research agenda

Outsourcing R&D is an increasingly explored corporate practice. Extant research advanced our initial understanding of its increasing importance and benefits. While the associated literature has blossomed, the enthusiasm of R&D managers is tenured by an increasing realization of the possible downsides, risks, and costs that come with increasing use of external sources of innovation. Here, we suggest that research on outsourcing R&D has to move towards a balanced view on the profitability of such arrangements. To this end, we offer a review of what we know and need to know about outsourcing R&D, suggest a simple, yet integrative model on the relation between outsourcing R&D and performance, and offer a research agenda that is instrumental in guiding companies' process-management and design strategies when seeking to benefit from the outsourcing of R&D.