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Business Services Industry
Process management and technological innovation: a longitudinal study of the photography and paint industries
Administrative Science Quarterly, Dec, 2002 by Mary J. Benner, Michael Tushman
APPENDIX: Patent Classification Codes
Patent
Class Title
Photography Industry
250 Radiant Energy
345 Computer Graphics Processing, Operator Interface Processing,
and Selective Visual Display Systems
348 Television (many digital camera patents are included here)
355 Photocopying
356 Optics: Measuring and Testing
359 Optics: Systems (Including Communication) and Elements
360 Dynamic Magnetic Information Storage or Retrieval
382 Image Analysis
386 Television Signal Processing for Dynamic Recording or
Reproducing
396 Photography
428 Stock Material or Miscellaneous Articles
430 Radiation Imagery Chemistry: Process, Composition, or
Product Thereof
Paint Industry
106 Coating Compositions
Table 1
Summary Statistics (by Firm-Year) for the Photography and Paint
Industries
Photography
Variable Mean S.D.
Average patents 63.4 112.88
Number of exploitative patents
based 100% on existing knowledge 14.36 32.4
based > 80% on existing knowledge 22.4 50.2
based > 60% on existing knowledge 35.4 75.1
Numbers of exploratory patents
based 0% on existing knowledge 19.3 24.8
based [less than or equal to] 20% on existing
knowledge 24.8 31.6
based [less than or equal to] 40% existing
knowledge 38.3 51.1
ISO 9000 certifications
Overall 1.5 4.2
For ISO 9000 adopters 5.5 6.5
Paint
Variable Mean S.D.
Average patents 2.8 3.3
Number of exploitative patents
based 100% on existing knowledge .31 .60
based > 80% on existing knowledge .43 .87
based > 60% on existing knowledge .74 1.3
Numbers of exploratory patents
based 0% on existing knowledge .94 .87
based [less than or equal to] 20% on existing
knowledge 1.02 .93
based [less than or equal to] 40% existing
knowledge 1.66 1.7
ISO 9000 certifications
Overall 12.8 20
For ISO 9000 adopters 20 22
Table 2
Panel Negative Binomial Models with Firm Fixed Effects for Effect of
ISO 9000 Certifications on Counts of Exploitative Innovations in the
Photography Industry (N = 37) (A)
Patents
based > 80%
on existing
Patents based > 60% on firm
existing firm knowledge knowledge
Variable Model 1 Model 2 Model 3
R&D intensity .0024 *** .0024 *** .0025 ***
(.0002) (.0002) (.0002)
Performance .0037 .0057 ** .0082 **
(.0029) (.0029) (.0032)
Year dummies
(base year 1985)
1986 .0685 .0649 .0843
(0.1280) (0.1257) (.1419)
1987 .2591 ** .2517 ** .2535 *
(.1226) (.1205) (.1362)
1988 .2578 ** .2462 ** .2161
(.1221) (.1200) (.1364)
1989 .2338 * .2230 * .2170
(.1230) (.1209) (.1362)
1990 .2458 ** .2333 * .1611
(.1233) (.1211) (.1381)
1991 .1873 .1671 .0552
(.1252) (.1232) (.1416)
1992 .2591 ** .2079 * .1730
(.1254) (.1248) (.1412)
1993 .5195 *** .4421 *** .4299 ***
(.1216) (.1228) (.1355)
1994 .3900 *** .2796 ** .2967 **
(.1304) (.1345) (.1463)
1995 .0772 -.0198 .0352
(.1356) (.1373) (.1497)
1996 -.6052 *** -.7629 ** -.5266 ***
(.1523) (.1609) (.1628)
IS0 9000 .0225 ***
certifications (.0074)
Constant 1.4511 *** 1.4838 *** 1.2426 ***
(.1447) (.1444) (0.1578)
Observations 374 374 374
Patents
based > 80%
on existing
firm Patents based 100% on
knowledge existing firm knowledge
Variable Model 4 Model 5 Model 6
R&D intensity .0025 *** .0026 *** .0026 ***
(.0002) (.0002) (.0002)
Performance .0109 *** .0055 .0075 **
(.0032) (.0036) (.0036)
Year dummies
(base year 1985)
1986 .0799 -.0158 -.0192
(.1385) (.1453) (.1438)
1987 .2454 * .1661 .1599
(.1330) (.1389) (.1375)
1988 .2020 .0840 .0734
(.1333) (.1408) (.1394)
1989 .2052 .0812 .0721
(.1329) (.1404) (.1389)
1990 .1479 .0600 .0491
(.1346) (.1416) (.1400)
1991 .0302 -.0594 -.0788
(.1384) (.1456) (.1442)
1992 .1037 -.0659 -.1187
(.1397) (.1484) (.1490)
1993 .3296 ** .2700 * .1941
(.1358) (.1403) (.1430)
1994 .1510 .0887 -.0223
(.1499) (.1533) (.1600)
1995 -.0900 -.1783 -.2704 *
(.1503) (.1567) (.1599)
1996 -.7349 *** -.6568 *** -.7996 ***
(.1722) (.1707) (.1816)
IS0 9000 .0291 *** .0210 **
certifications (.0079) (.0088)
Constant 1.2928 *** 1.3348 *** 1.3525 ***
(.1576) (0.1668) (.1667)
Observations 374 374 374
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
(A) Standard errors are in parentheses.
Table 3
Panel Negative Binomial Models with Firm Fixed Effects for Effect of
ISO 9000 Certifications on Counts of Exploratory Innovations in the
Photography Industry (N = 40) (A)
Patents
based [less
than or
equal to]
20% on ex-
Patents based 0% on isting firm
existing firm knowledge knowledge
Variable Model 1 Model 2 Model 3
R&D intensity .001 *** .001 *** .001 ***
(.0002) (.0002) (.0002)
Performance -.001 -.002 -.001
(.003) (.003) (.003)
Year dummies
(base year 1985)
1986 -.116 -.115 -.076
(.089) (.089) (.085)
1987 .054 .054 .068
(.086) (.085) (.083)
1988 -.019 -.018 .030
(.089) (.088) (.085)
1989 -.018 -.018 .062
(.090) (.089) (.085)
1990 -.033 -.031 .047
(.092) (.091) (.087)
1991 -.170 * -.163 * -.030
(.097) (.096) (.090)
1992 -.232 ** -.208 ** -.097
(.099) (.098) (.092)
1993 -.191 * -.147 -.022
(.098) (.099) (.092)
1994 -.194 * -.140 -.082
(.104) (.105) (.097)
1995 -.462 *** -.399 *** -.384 ***
(.113) (.115) (.106)
1996 -1.696 *** -1.617 *** -1.576 ***
(.155) (.157) (.142)
IS0 9000 -.020 **
certifications (.009)
Constant 2.675 *** 2.702 *** 2.684 ***
(.155) (.156) (.148)
Observations 383 383 383
Patents
based [less
than or
equal to]
20% on ex- Patents based [less than or
isting firm equal to] 40% on
knowledge existing firm knowledge
Variable Model 4 Model 5 Model 6
R&D intensity .001 *** .001 *** .001 ***
(.0002) (.0002) (.0002)
Performance -.002 -.002 -.002
(.003) (.002) (.002)
Year dummies
(base year 1985)
1986 -.075 -.030 -.029
(.084) (.082) (.082)
1987 .069 .089 .090
(.082) (.080) (.080)
1988 .032 .094 .095
(.084) (.081) (.081)
1989 .064 .125 .127
(.084) (.081) (.081)
1990 .051 .101 .104
(.086) (.083) (.082)
1991 -.022 .059 .065
(.089) (.085) (.085)
1992 -.072 .007 .024
(.092) (.086) (.087)
1993 .023 .107 .135
(.092) (.086) (.087)
1994 -.027 .041 .077
(.099) (.091) (.093)
1995 -.318 *** -.259 *** -.217 **
(.108) (.099) (.102)
1996 -1.493 *** -1.469 *** -1.410 ***
(.144) (.132) (.136)
IS0 9000 -.019 ** -.011 * ([dagger])
certifications (.008) (.007)
Constant 2.715 *** 2.590 *** 2.604 ***
(.148) (0.134) (.134)
Observations 383 383 383
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
(A) Standard errors are in parentheses.
([dagger]) One-tailed test.
Table 4
Panel OLS Models with Firm Fixed Effects for Effect of ISO 9000
Certifications on Exploitation's Share of Innovation in the
Photography Industry (N = 40) (A)
Share of patents based
> 60% on existing firm
knowledge
Variable Model 1 Model 2
Average R&D intensity .0006 *** .0006 ***
(.0001) (.0001)
Performance .0001 .0003
(.0009) (.0009)
Year dummies
(base year 1985)
1986 .0078 .0081
(.0259) (.0258)
1987 .0214 .0220
(.0259) (.0258)
1988 .0279 .0289
(.0266) (.0265)
1989 .0199 .0213
(.0267) (.0266)
1990 .0117 .0130
(.0270) (.0269)
1991 -.0207 -.0203
(.0272) (.0271)
1992 .0288 .0262
(.0272) (.0271)
1993 .0456 * .0399
(.0272) (.0273)
1994 .0474 * .0387
(.0280) (.0282)
1995 .0347 .0241
(.0288) (.0292)
1996 .1242 ** .1114 ***
(.0292) (.0298)
IS0 9000 .0046 *
certifications (.0024)
Constant .1697 *** .1729 ***
(.0204) (.0204)
Observations 374 374
R-squared .25 .26
Share of patents based
> 80% on existing firm
knowledge
Variable Model 3 Model 4
Average R&D intensity .0005 *** .0004 ***
(.0001) (.0001)
Performance .0005 .0007
(.0008) (.0008)
Year dummies
(base year 1985)
1986 .0071 .0076
(.0229) (.0227)
1987 .0102 .0109
(.0229) (.0226)
1988 .0103 .0115
(.0235) (.0233)
1989 .0168 .0185
(.0236) (.0234)
1990 -.0148 -.0133
(.0238) (.0236)
1991 -.0305 -.0300
(.0240) (.0238)
1992 .0189 .0157
(.0241) (.0239)
1993 .0006 -.0063
(.0241) (.0240)
1994 .0062 -.0045
(.0247) (.0248)
1995 .0217 .0088
(.0254) (.0256)
1996 .0826 *** .0668 **
(.0258) (.0262)
IS0 9000 .0056 ***
certifications (.0021)
Constant .0937 *** .0977 ***
(.0180) (.0179)
Observations 374 374
R-squared .21 .22
Share of patents based
100% on existing firm
knowledge
Variable Model 5 Model 6
Average R&D intensity .0003 *** .0003 ***
(.0001) (.0001)
Performance .0001 .0002
(.0006) (.0006)
Year dummies
(base year 1985)
1986 .0035 .0037
(.0187) (.0187)
1987 .0016 .0019
(.0187) (.0187)
1988 .0013 .0019
(.0192) (.0192)
1989 .0012 .0020
(.0193) (.0192)
1990 -.0133 -.0126
(.0195) (.0195)
1991 -.0225 -.0223
(.0196) (.0196)
1992 -.0046 -.0061
(.0197) (.0197)
1993 -.0072 1.0104
(.0197) (.0197)
1994 -.0099 -.0149
(.0202) (.0204)
1995 .0065 .0005
(.0208) (.0211)
1996 .0462 ** .0388 *
(.0211) (.0216)
IS0 9000 .0026 * ([dagger])
certifications (.0017)
Constant .0767 *** .0785 ***
(.0147) (.0148)
Observations 374 374
R-squared .11 .12
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
(A) Standard errors are in parentheses.
([dagger]) One-tailed test.
Table 5
Panel Negative Binomial Models with Firm Fixed Effects for Effect of
ISO 9000 Certifications on Counts of Exploitative Innovations in the
Paint Industry (N = 5) *
Patents
based > 80%
on existing
Patents based > 60% on firm
existing firm knowledge knowledge
Variable Model 1 Model 2 Model 3
R&D intensity .0839 -.1217 .0810
(0.074) (.1055) (.1064)
Performance .0083 -.0016 -.0919
(.0940) (.0969) (.1335)
Year dummies
(base year 1985)
1986 -1.8545 ** -1.1909 -1.2929
(.8142) (.8293) (1.2095)
1987 -.9448 -1.487 * -18.9057
(.7454) (.7960) (9,900)
1988 -.5236 -.8775 .1177
(.6669) (.6987) (1.0943)
1989 -.7797 -.3633 .4625
(.7103) (.6726) (1.1464)
1990 -1.1893 -1.078 .1966
(.8605) (.8702) (1.3672)
1991 -.7979 -.4602 .5874
(.7019) (.6789) (1.1459)
1992 -.8440 -1.368 * .8888
(.7170) (.7417) (1.1192)
1993 -.9206 -2.145 ** .2640
(.7075) (.8564) (1.1853)
1994 -.7364 -2.367 ** .5298
(.6486) (.9255) (.9934)
1995 -.8543 -2.3589 ** 1.0136
(.7512) (.9617) (1.2088)
1996 -.9573 -3.486 *** .8649
(.6489) (1.124) (.9936)
IS0 9000 .0609 ***
certifications (.0206)
Constant 16.53 17.86 15.89
(1,073.7) (1,080.2) (1,208.3)
Observations 42 42 42
Patents
based > 80%
on existing
firm Patents based 100% on
knowledge existing firm knowledge
Variable Model 4 Model 5 Model 6
R&D intensity -.4837 ** .0135 -.4976 *
(.2255) (.1298) (.2816)
Performance -.1193 -.0726 -.1547
(.1651) (.1774) (.2337)
Year dummies
(base year 1985)
1986 .2653 -.9975 .3119
(1.4388) (1.2416) (1.5809)
1987 -19.1604 -20.2281 -21.0507
(3,942) (17,160) (10,399)
1988 -0.9079 .0211 -.6888
(1.2611) (1.2054) (1.4647)
1989 1.0707 .1003 .9190
(1.2428) (1.4438) (1.5095)
1990 .1764 .0942 .2787
(1.6318) (1.7299) (2.0133)
1991 1.5022 .0332 1.0899
(1.2665) (1.5065) (1.6684)
1992 -.2401 .8360 -0.6686
(1.2679) (1.4562 (1.8058)
1993 -2.784 * .5929 -3.2620
(1.6008) (1.4446) (2.3272)
1994 -3.389 * -.6859 -5.4440 *
(1.7410) (1.4072) (2.8096)
1995 -2.3678 .5243 -3.9702
(1.7788) (1.6786) (2.8234)
1996 -5.240 ** -.3589 -7.9076 **
(2.2527) (1.5466) (3.6526)
IS0 9000 .1522 ** .1714 *
certifications (.0478) (.0699)
Constant 19.37 17.16 24.06
(925.0) (1,275.9) (120.03)
Observations 42 42 42
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
* Standard errors are in parentheses.
Table 6
Panel Negative Binomial Models with Firm Fixed Effects for Effect of
ISO 9000 Certifications on Counts of Exploratory Innovations in the
Paint Industry (N = 6) (A)
Patents
based [less
than or
equal to]
20% on ex-
Patents based 0% on isting firm
existing firm knowledge knowledge
Variable Model 1 Model 2 Model 3
R&D intensity -.041 -.025 .004
(.067) (.085) (.055)
Performance .164 * .166 * .094
(.085) (.085) (.069)
Year dummies
(base = 1985)
1986 -.068 -.105 -.491
(.752) (.761) (.719)
1987 -.467 -.430 -.021
(.783) (.793) (.659)
1988 -.235 -.237 -.093
(.701) (.701) (.634)
1989 -.509 -.544 -.130
(.713) (.727) (.631)
1990 -.658 -.654 -.086
(.834) (.836) (.706)
1991 -.805 -.828 -.561
(.748) (.754) (.667)
1992 -.219 -.170 -.089
(.778) (.796) (.683)
1993 -.610 -.498 .139
(.855) (.928) (.664)
1994 -.814 -.687 -.019
(.770) (.871) (.613)
1995 -1.216 -1.068 -.589
(.897) (1.015) (.746)
1996 -1.282 -1.091 -.239
(.886) (1.084) (.665)
IS0 9000 -.006
certifications (.018)
Constant 14.839 15.215 15.255
(745.035) (.000) (785.339)
Observations 44 44 44
Patents
based [less
than or
equal to]
20% on ex- Patents based [less than or
isting firm equal to] 40% on
knowledge existing firm knowledge
Variable Model 4 Model 5 Model 6
R&D intensity .015 -.021 -.008
(.072) (.045) (.058)
Performance .094 .141 ** .143 **
(.069) (.057) (.057)
Year dummies
(base = 1985)
1986 -.520 -.835 -.870
(.728) (.533) (.542)
1987 .009 -.944 * -.915 *
(.671) (.527) (.533)
1988 -.089 -.552 -.549
(.634) (.455) (.455)
1989 -.153 -1.243 ** -1.289 **
(.641) (.516) (.534)
1990 -.083 -.771 -.786
(.708) (.551) (.554)
1991 -.578 -1.000 ** -1.032 **
(.673) (.493) (.503)
1992 -.060 -.804 -.775
(.695) (.512) (.520)
1993 .207 -.709 -.633
(.719) (.505) (.545)
1994 .062 -.696 -.601
(.693) (.467) (.532)
1995 -.499 -1.581 *** -1.480 **
(.829) (.602) (.662)
1996 -.108 -1.046 ** -.891
(.850) (.514) (.666)
IS0 9000 -.004 -.004
certifications (.014) (.012)
Constant 16.527 15.885 15.771
(.000) (734.238) (648.225)
Observations 44 44 44
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
(A) Standard errors are in parentheses.
Table 7
Panel OLS Models with Firm Fixed Effects for Effect of ISO 9000
Certifications on Exploitation's Share of Innovation in the
Paint Industry (N = 6) (A)
Share of patents based
> 60% on existing firm
knowledge
Variable Model 1 Model 2
Average R&D intensity .0422 ** -.0157
(.0166) (.0241)
Performance -.0358 * -.0458 **
(.0187) (.0163)
Year dummies
(base = 1985)
1986 -.1833 -.0625
(.1481) (.1323)
1987 .0553 .1144
(.1499) (.1289)
1988 .0362 .0060
(.1603) (.1365)
1989 .2682 .3625 **
(.1728) (.1502)
1990 .0765 .1938
(.1719) (.1513)
1991 .1501 .2332
(.1630) (.1413)
1992 -.0114 .0199
(.1829) (.1557)
1993 -.0635 -.1750
(.1910) (.1665)
1994 -.0085 -.1737
(.1983) (.1775)
1995 .0277 -.1487
(.1946) (.1757)
1996 -.0924 -.4155 **
(.1800) (.1880)
IS0 9000 .0141 ***
certifications (.0048)
Constant 0.4300 ** .7400 ***
(.1552) (.1685)
Observations 39 39
R-squared .38 .58
Share of patents based
> 80% on existing firm
knowledge
Variable Model 3 Model 4
Average R&D intensity .0424 ** .0122
(.0150) (.0248)
Performance -.0477 ** -.0529 ***
(.0169) (.0167)
Year dummies
(base year 1985)
1986 .0140 .0771
(.1335) (.1361)
1987 .0298 .0606
(.1350) (.1326)
1988 .2481 .2323
(.1444) (.1405)
1989 .4452 *** .4945 ***
(.1556) (.1545)
1990 .3086 * .3699 **
(.1549) (.1557)
1991 .3531 ** .3965 **
(.1468) (.1454)
1992 .3160 * .3324 *
(.1648) (.1603)
1993 .1812 .1230
(.1720) (.1714)
1994 .2124 .1260
(.1787) (.1827)
1995 .3247 * .2325
(.1753) (.1809)
1996 .2196 .0507
(.1622) (.1935)
IS0 9000 .0074
certifications (.0049)
Constant .2407 .4026 **
(.1399) (.1734)
Observations 39 39
R-squared .47 .53
Share of patents based
100% on existing firm
knowledge
Variable Model 5 Model 6
Average R&D intensity .0247 * 0.0101
(.0139) (0.0241)
Performance -.0314 * -0.0340 *
(.0157) (0.0163)
Year dummies
(base year 1985)
1986 .0750 .1056
(.1245) (.1324)
1987 .0238 .0388
(.1260) (.1289)
1988 .2011 .1934
(.1347) (.1366)
1989 .3374 ** .3613 **
(.1452) (.1502)
1990 .2265 .2562
(.1445) (.1514)
1991 .1829 .2039
(.1370) (.1413)
1992 .2454 .2534
(.1537) (.1558)
1993 .1706 .1424
(.1605) (.1666)
1994 .1270 .0852
(.1667) (.1776)
1995 .1206 .0759
(.1635) (.1758)
1996 .0677 -.0141
(.1513) (.1881)
IS0 9000 .0036
certifications (.0048)
Constant .1840 .2625
(.1304) (.1686)
Observations 39 39
R-squared .35 .37
* p < .10; ** p < .05; *** p < .01; two-tailed tests.
(A) Standard errors are in parentheses.
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