How do latecomer firms achieve catch-up through technology management: a comparative analysis

The rapid catch-up of emerging economies has generated a large amount of research on the mechanism behind this phenomenon. The main focus of the literature has been on the role of government, and another stream of research has largely focused on innovation, especially product innovation. Product innovation has become critical for latecomer firms to achieve catch-up as competitive advantage has shifted from traditional factors to product innovation. While product innovation is resource-intensive and risky, success depends on technology resources and their effective deployment through technology management (TM). Prior work shows TM is closely related to product innovation, but the relationship varies as TM practices and modes differ across contexts. There is a lack of in-depth cross-national studies on TM practices and modes, particularly contrasting latecomers and forerunners, which limits guidance for catch-up. This paper addresses this gap by comparing China (latecomer) and Korea (forerunner). China lags in product innovation despite significant investments, while Korea is a representative successful catch-up case approaching advanced economy status. The comparison is favorable for measurement invariance as China and Korea share Confucian cultural traits, reducing cultural confounds. The study aims to reveal differences in TM practices and modes between Chinese and Korean firms and link TM to product innovation performance across these contexts. The paper proceeds with literature review and hypotheses, research methods, data analysis and results, and concludes with discussion, implications, and future research directions.

The literature review situates catch-up as the process by which latecomer firms reach and surpass forerunners. Prior studies emphasize government roles via institutional environments and stakeholder coordination to enhance firm innovation capabilities. Latecomers typically evolve from OEM to ODM to OBM, accumulating capabilities to depart from early innovators’ trajectories. However, the link between catch-up and technology management (TM) has been underexplored. TM is defined as processes of planning, directing, controlling, and coordinating technological capabilities to achieve organizational objectives, encompassing acquisition and deployment of technology resources. From the resource-based view (RBV), technology resources include financial, physical, human intellectual, and other tangible/intangible assets. TM practices span technology finance management, technology equipment management, technological human resource management (THRM), technology information management, and technology achievement management. The review develops six hypotheses comparing latecomers (China) and forerunners (Korea): H1: Technology finance management operations do not significantly differ between latecomer and forerunner firms, as both require adequate, well-allocated, and adaptively managed R&D funding. H2: Technology equipment management differs: latecomers emphasize grasping equipment condition and control/modification to build basic capability, whereas forerunners emphasize learning from competitors on equipment use and maintenance. H3: THRM differs: latecomers prioritize understanding needed technological talents and talent development strategies; forerunners emphasize strategic HR practices such as effective training to reduce work tension and enhance commitment. H4: Technology information management differs: latecomers focus on acquiring and filing technology information to absorb external knowledge; forerunners focus on constructing detailed technology information systems and transferring information into product innovation. H5: Technology achievement management does not significantly differ: both latecomers and forerunners should recognize, evaluate, disseminate, protect, and leverage technology achievements (including patents) for product innovation. H6: TM is more integrally related to product innovation in forerunner firms, which tend to use TM practices holistically to maximize resource value and erect entry barriers, leading to stronger correlations between TM dimensions and product innovation performance.

Research design: An international comparative research design was used to test differences in TM practices and modes across latecomer (China) and forerunner (Korea) contexts, aiming to understand how latecomers achieve catch-up in product innovation via TM. Sampling and data: Data were collected from high-technology firms in China and Korea. Korean firms came from automotive (9 firms, 29.03%) and electrical machinery and equipment (22 firms, 70.97%) industries, representing successful catch-up sectors. Chinese firms came from aircraft and spacecraft (24, 50.00%), automobile (10, 20.84%), electrical machinery and apparatus (6, 12.50%), pharmaceutical (4, 8.33%), and machinery and equipment (4, 8.33%) industries, which still have technology gaps relative to global leaders. Respondents were senior managers responsible for TM and product innovation. To reduce common method variance, different respondents answered different parts: TM items were completed by TM managers; product innovation performance by R&D managers. Responses: 48 Chinese firms and 31 Korean firms responded (response rates 0.68 and 0.44; some unusable due to missing values). Non-response bias checks (t-tests on firm size) showed no significant differences. Measurement: A structured questionnaire measured TM (adapted from Wu et al., 2012) covering five TM dimensions: technology finance management; technology equipment management; THRM; technology information management; technology achievement management. Product innovation performance was measured with four items adapted from Alegre and Chiva (2008), capturing innovation efficacy and efficiency. The instrument contained 36 items on a 5-point Likert scale (1 = strongly disagree, 3 = neutral, 5 = strongly agree). Translation used double-translation by bilingual native speakers into Chinese and Korean; a pilot test (four Chinese firms, three Korean firms) informed wording/format adjustments. Sample comparability: Matching on firm size and industry type ensured cross-country comparability. Size distribution was similar: small firms 27.08% (China) vs 29.03% (Korea); medium 33.34% vs 32.26%; large 39.58% vs 38.71%. Industry distribution: high-technology 52.08% (China) vs 48.38% (Korea); medium-high-technology 47.92% vs 51.62%. Cultural similarity (Confucian cluster) supported measurement invariance. Reliability and validity: Cronbach’s alpha values for TM and product innovation performance exceeded 0.70 in both samples. Content validity was ensured via literature-based item generation and expert/manager reviews. Measurement invariance was supported by consistent translations, similar sampling procedures, and cultural proximity. Data analysis: SPSS 24 was used. Descriptive statistics (means, SDs, rankings) of TM items were compared across countries. Correlations between TM dimensions and product innovation performance (and its components: product leadership, development cycle, cost, success rate) were computed for each country.

Descriptive comparisons: Technology equipment management: Chinese firms emphasized management’s ability to grasp equipment condition most (Mean 4.0208; Ranking 1) and least emphasized learning from other businesses on equipment (Mean 3.7292; Ranking 5). Korean firms showed the opposite pattern, emphasizing learning from other businesses on equipment most (Mean 3.7742; Ranking 1) and placing least emphasis on grasping equipment condition (Mean 3.3871; Ranking 5). Supports H2. THRM: Chinese firms prioritized understanding technology talents required by the business (Mean 4.0833; Rank 1), learning from success and failure (Mean 3.7917; Rank 2), and developing talent strategies (Mean 3.7708; Rank 3). Korean firms prioritized effective training (Mean 3.7419; Rank 1), motivating technical staff (Mean 3.6774; Rank 2), and team building (Mean 3.6129; Rank 3). Supports H3. Technology information management: Chinese firms emphasized completing technology files most (Mean 3.7500; Rank 1), while constructing detailed technology information management systems (Mean 3.4375; Rank 5) and researching every technology (Mean 3.4167; Rank 6) ranked lowest. Korean firms emphasized constructing detailed technology information management systems most (Mean 3.4516; Rank 1), with researching every technology (Mean 3.1935; Rank 5) and effective technology information transfer systems (Mean 3.1613; Rank 6) lowest. Supports H4. Technology finance management and technology achievement management rankings showed no significant differences between countries, supporting H1 and H5. Correlations with product innovation performance (PIP): Korea (forerunner): All five TM dimensions were very highly correlated with overall PIP (p < 0.01): technology finance management β = 0.908; technology equipment management β = 0.885; THRM β = 0.877; technology information management β = 0.886; technology achievement management β = 0.909. At the component level, most TM practices showed strong correlations with product leadership, development cycle, cost, and success rate (generally β > 0.70, p < 0.01), with minor exceptions (e.g., equipment management with product leadership β = 0.682; THRM with product cost β = 0.699). China (latecomer): Only THRM (β = 0.771, p < 0.01) and technology achievement management (β = 0.791, p < 0.01) were highly correlated with overall PIP, while technology finance (β = 0.603), equipment (β = 0.673), and information management (β = 0.692) showed moderate correlations (all p < 0.01). Component-level highlights: THRM (β = 0.732) and achievement management (β = 0.715) correlated highly with product leadership; THRM (β = 0.793) and achievement management (β = 0.779) correlated highly with product success rate (all p < 0.01). Supports H6 that forerunner firms exhibit a more integrated TM–innovation linkage. Mode transformation insight: Findings depict a transformation path from latecomer to forerunner TM mode: latecomers show selective emphasis (notably THRM and achievement use) and less integral TM linkages to innovation, while forerunners apply TM practices holistically and integratively to drive product innovation.

The study addressed how differences in TM practices and modes between latecomers and forerunners relate to product innovation. The results confirm that latecomer firms (China) emphasize foundational, acquisition- and absorption-oriented TM practices—monitoring equipment condition, understanding needed technological talent, and completing technology information files—aligned with capability building and knowledge absorption. Forerunner firms (Korea) emphasize learning from competitors regarding equipment use, investing in effective training, and constructing detailed technology information systems, consistent with leveraging and orchestrating abundant technology resources. Critically, TM–innovation linkages are far more integrated for forerunners: all five TM dimensions strongly correlate with product innovation outcomes, whereas latecomers show strong linkages primarily for THRM and technology achievement management. These findings illuminate the mechanism by which forerunners sustain leadership: by holistically managing financial, equipment, human, information, and achievement resources to maximize innovation output and efficiency. The results contribute to catch-up theory by framing catch-up not only as capability accumulation but also as a transition in TM mode toward integrative resource management. By grounding TM within RBV, the study shows that the deployment and coordination of heterogeneous resources differ by development stage, offering contingent insights for RBV generalizability. Managerially, the findings suggest latecomers should develop stronger, systemic linkages between finance, equipment, and information management and product innovation, while continuing to strengthen THRM and achievement management.

This paper reveals substantive cross-national differences in TM practices and modes between latecomer (Chinese) and forerunner (Korean) firms and demonstrates that forerunners exhibit a more integrated TM–product innovation relationship. The study advances theory by: (1) proposing an integrative RBV-grounded TM framework comprising five sub-processes; (2) extending catch-up literature through an international comparative TM perspective; and (3) informing RBV by evidencing context-contingent resource deployment processes. Practically, latecomers should emulate forerunners’ holistic TM by strengthening the connections of technology finance, equipment, and information management with product innovation, and by cultivating strong ties between technology achievement management and innovation outcomes. Future research should expand samples and sectors, include additional controls for better matching, examine more latecomer–forerunner pairs to enhance generalizability, incorporate additional variables omitted by the parsimonious model, and refine measurement to capture the most salient TM differences.

The study has several limitations: (1) Despite matching on firm size and industry, additional controls may be needed to ensure closer cross-country comparability. (2) The sample sizes (48 Chinese firms, 31 Korean firms) are relatively small; larger samples would improve representativeness. (3) The sample is limited to specific sectors; extending to other industries would enhance generalizability. (4) The parsimonious model may omit relevant variables; future studies could incorporate additional constructs. (5) The questionnaire could be refined to focus on the most significant differences between latecomers and forerunners. (6) Findings pertain to China and Korea; replication across more national contexts would provide broader validation.