Beyond formal R&D: Taking advantage of other sources of innovation in low- and medium-technology industries

Abstract

This study deepens our knowledge of critical success factors in the innovation process of low- andmediumtechnology
\n(LMT) industries. To accomplish this, it explores howthe innovation process in LMT firms may
\ndepend on non-formal R&D activities and the use of external sources. The empirical analysis is based on
\na representative panel of Spanish manufacturing firms. The results strongly support the view that non-
\nR&D activities such as design, the use of advanced machinery and training are crucial to understanding
\nthe innovation process of any firm. The study finds, however, that the impact of these activities is especially
\nimportant in LMT industries, particularly for the achievement of product innovations. The empirical
\nevidence also reveals the importance of external sources such as the use of consultants, the hiring of
\npersonnel, collaboration agreements and external R&D, with the greatest differences between LMT and
\nhigh-technology (HT) firms being observed in process innovations