Managing Cross-Border R&D Teams: The Moderating Effects of Team Configurations

With the surge over the past decade in the geographical expansion of research and development (R&D) activities in multinational corporations (MNCs), collaborative efforts among inventors residing in different locations, commonly termed cross-border R&D collaboration, have become commonplace. While prior research has revealed the importance of cross-border collaboration in the innovation process at the firm level in MNCs, few empirical studies have examined management of cross-border R&D teams at the team level. Cooperation and coordination among geographically dispersed employees can be severely challenging. Without appropriate mechanisms for team management, MNCs may be unable to benefit fully from cross-border R&D collaboration. The primary purpose of this study is to examine how different ways of configuring a geographically diverse research team affect innovation quality. By analyzing U.S. patent data in the global pharmaceutical industry, we find support for the following hypotheses: 1) the geographic diversity of a research team has an inverted U-shaped relationship with the team's innovation quality; and 2) the inverted U-shaped relationship is affected by both the technological superiority of the leader and repeated collaboration among inventors. The results enhance our understanding of cross-border R&D collaboration at the team and firm levels. In addition, we provide practical advice for managing geographically dispersed research teams.