**Jinyuan Ma**

Center for Higher Education Research, Southern University of Science and Technology, Shenzhen 518055, China; majy@sustech.edu.cn

Received: 9 October 2019; Accepted: 9 December 2019; Published: 12 December 2019

**Abstract:** This paper examines the role of joint R&D institutes co-established by Chinese research universities and international enterprises. Guided by an analytical framework of institutional logics in the evolution of the Triple Helix model, this study aims to explore the institutionalization process of a joint R&D institute in the contexts of global and Chinese innovation systems; further, it analyzes which mingling institutional logics, respectively carried by a Chinese research university and an international enterprise, affect the collaboration between both parties moving from informal R&D collaboration toward an institutionalized organization. The case study method enabled the author to understand the complexity of the interlacing of international and national actors with regards to the joint R&D institutes. The contribution of the study to the existing literature is two-fold: on the conceptual front, it advances theoretical understandings of the interactions of institutional logics which result in varied patterns of joint R&D institute in a national context with transnational factors; on the empirical front, it examines the evolutionary path of a joint R&D institute established by a Chinese research university and an international enterprise.

**Keywords:** joint R&D institute; institutional logics; China's innovation system; China's transnational Triple Helix linkages; Chinese research university

### **1. Introduction**

In the contemporary era of R&D globalization, when knowledge, technology and human resources are becoming globally and geographically distributed, many research-intensive universities are increasingly engaged in R&D partnerships with international enterprises [1]. Joint R&D institutes are an important form of partnership taking place between research universities and international enterprises [2,3].

The key term of this study, joint R&D institute, originates from the broadly defined concept of cooperative research center [4–9]. The term "joint R&D institute" is used alternatively in this study in order to highlight the contextual relevance of Chinese research universities, as the names of China's university-based cooperative research centers always start with "joint" (*Lian He* in Chinese) Joint R&D institute in this paper is defined as:

An organization or unit, jointly established by a research university and an international enterprise, that have officially registered in the university's research management department with explicit missions to promote, directly or indirectly, cross-sector and cross-border collaboration, knowledge and technology transfer, and ultimately innovation [6,10].

In this study, the joint R&D institutes refer to the cooperative research centers jointly established by Chinese research universities and international enterprises. They share the three common features with the cooperative research centers, which are identified by Boardman and Gray (2010: 451): (1) engagement in research, (2) exhibition of organizational formality, and (3) promotion of organizational and

cross-sector collaboration and transfer. In this study, the above-mentioned "larger organization" refers to the joint R&D institute's affiliated university. The joint R&D institutes' mandates, operations and activities reflect the interests of both their affiliated universities and their external international sponsors. Moreover, their organizational formalities are more flexible than departmental structures and can be adjusted to increase the universities' adaptations and responsiveness to the demands of the external community [11,12].

Since the mid-1990s, when an increasing number of international enterprises started to move better paid and more brain-intensive labor to China, Chinese research universities have become the primary R&D partners for these enterprises [13–15], and joint R&D institutes have become one of their most important forms of partnership [16–19]. As of 2016, international enterprises had established more than 1800 R&D institutes in China [20]. According to statistics from the Ministry of Education of China, the key universities directly under the supervision of the Ministry of Education have close collaborations with more than 1100 enterprises from more than 100 countries around the world [21].

What, then, are the attractions of China, and the Chinese research universities, for those international enterprises? Wang et al. [22] perceived R&D cooperation as a kind of transaction. The major incentives for international enterprises are pressure from market competition and cost saving. Universities provide knowledge and cultural products as well as human resources to enterprises, while enterprises can supply universities with funds, equipment, and information about market needs for talents. Xue (2006) [23] provided a similar opinion: owing to the favorable research platforms offered by joint R&D institutes, international enterprises can easily synergize internal and external R&D resources, lower their development costs through avoiding transaction costs, reduce the risk of project failure due to better interaction, and acquire promising graduates from Chinese universities.

Cong and Xue [24] discussed the international enterprises' strategic planning from the perspective of integrated innovation, which means integrating, coordinating and optimizing interrelated, interdependent and interactive innovation elements to achieve the specific purpose of efficient innovation. The reason why international enterprises have decided to cooperate with Chinese research universities in the rapidly growing technological field is to reduce the risk brought by remarkable technological change. They want to trace the new direction of universities' basic and applied research, and to be prepared to effectively integrate newly developed technologies with existing ones. Therefore, when R&D cooperation involves technological exploration that is closely bound up with the enterprises' development strategies, the enterprises will attach much attention to process and result management.

He [25] believes that, besides acting as the nodes of international enterprises' global R&D expansion, joint R&D institutes can also become involved in enhancing the universities' independent innovation capacity and disciplinary development level, as well as serving as an interface for technological cooperation and knowledge exchange between universities and international enterprises.

Besides the intentional initiatives undertaken by international enterprises, behind the intensity of R&D partnerships lies the Chinese government's "invisible hand" [26]. China's prioritization of innovation since the second half of the 1990s, and the country's desire to acquire knowledge and technology, have provided important opportunities and vehicles for technology-intensive international enterprises to exploit their innovation activities in China [18,27,28]. Specifically, these include China's rapidly rising R&D expenditure, a larger and higher-quality talent pool, comparatively low-cost researchers, and an impressively growing number of scientific publications and patents [18,29]. When discussing the "invisible hand", Xue (2006) [23] stated that support from the Chinese government, in terms of policies and public funding, has been important for promoting joint R&D activities.

Joint R&D institutes are positioned as the most mature form of R&D partnership between Chinese research universities and international enterprises [19,21]. Li and Li [19] classified the forms of R&D collaboration into project commission, joint development, joint talent training, and joint R&D institutes. Huang [21] also made such a classification in terms of development stages: personnel exchange and academic visits, international academic conferences, joint research, joint research programs, and joint R&D institutes.

When enterprises and universities seek R&D partners then the joint R&D institutes, as long-term cooperative research platforms, should be established based on a strong complementarity of advantages [30,31]. Specifically, Gugler and Michel [32] argued that these partnerships should follow "4C" principles: complementary ability, cooperative culture, compatible objectives, and commensurate risks. When choosing locations, international enterprises prefer major cities with a strong presence of international investors, and universities with distinct disciplinary advantages and strong R&D capacities; the enterprise side should have a corresponding capacity for technological development, applied research, and technology transfer [31].

With regards to the adoption of cooperative modes, Wright et al. [33] classified the activities of joint R&D institutes into three stages: in the first stage of technological invention, a joint development model should be created; in the second stage of technological adaptation to the market, entrusted development can be the cooperative model; and in the third stage of technological diffusion, universities should provide advisory services to industries. According to Mowery and Sampat [34], entrusted development is a more important model than patent licensing and technology transfer in joint R&D activities.

Empirical investigations have revealed problems in the R&D partnerships in joint R&D institutes. Some studies have recognized the unequal status between Chinese universities and international enterprises as R&D partners. The international enterprises often take a dominant position in intellectual property right (IPR) ownership distribution [35], R&D orientation [36], and institutional management [37,38]. Some IPRs involving core technology are exclusively monopolized by international enterprises [39]. The unequal situation often reflects which side is the funding provider and unequal R&D strength, although the advantageous R&D strength of international enterprises also has a positive impact on the universities' R&D improvement [17].

However, a gap in R&D experience between partners [40], as well as skills for knowledge and technology application and innovation, can reduce the efficiency of technology and knowledge spillover [41]. Moreover, a lack of communication skills and channels has been identified. First, this problem has impeded the ability of university R&D management staff to obtain R&D management experience [42]; second, this may lead to deficiencies in prior agreements [40]; third, when misunderstandings or disputes take place within the partnerships, the lack of resolution mechanisms may result in obstruction of technology spillover [43].

Despite all these problems, the positive effects of R&D cooperation on Chinese universities have also been remarkable in terms of financial support and upgrades to R&D strength [44]; in particular, R&D cooperation has helped university researchers better understand the trends of large international enterprises' product and technology innovation in China. In addition, it can expand the university researchers' forward-looking and cutting-edge views in the field, which can better match the market's orientation [45].

As discussed above, establishing joint R&D institutes is really an emerging and flourishing phenomenon in China, and there is a general research challenge on the organizational analysis of such kinds of organizations. Nevertheless, the existing literature points out that the nature of joint R&D institutes between Chinese universities and international enterprises is concerned with a mix between Chinese and Western ways of organizing things. The organizing principles can be understood as institutional logics, which are "the shared conceptual and normative frameworks that provide guidelines for the behavior of field participants" [46] (p. 8). The literature also implies that specific features of joint R&D institutes and challenges in running such institutes are related to the nature. However, few studies have provided theoretical accounts of the nature of mixing logics of underlying joint R&D institutes, particularly in explaining how the mixed institutional logics have affected the development of the joint R&D institutes.

Related to the lack of theoretical understandings of joint R&D institutes, another gap is that the research on joint R&D institutes focuses much on issues within the organizational boundaries of joint R&D institutes, with little attention to the contexts in which the joint R&D institutes are embedded. As suggested by Cai et al. [47], the contexts involved in transnational university and industry collaboration can be understood as transnational innovation eco-systems. As one of the rare studies taking a macroscopic and systemic point of view when researching joint R&D institutes, Xue and Wang [45] argue that joint R&D institutes have acted as the nodes in the transnational innovation systems. These joint R&D institutes represent a new type of actor in China's innovation system, which has made the national boundary of the system vaguer. Their study not only confirms that a fundamental characteristic of joint R&D institutes is a hybrid of institutional logics but also implies that multiple institutional logics in the joint R&D institutes may derive from system levels of logics of both China and forcing countries, from which the collaborating enterprises come. However, there is no ready framework for understanding the influences of the system logics on the development of joint R&D institutes.

To bridge the gaps, this paper aims to build an analytical framework to understand the development or institutionalization of joint R&D institutes and apply the framework in an empirical case of Tsinghua University's collaboration with an international enterprise in developing a joint R&D institute. Meyer and Rowan [48] (p. 341) define institutionalization as a process "by which social processes, obligations, or actualities, come to take on a rule-like status in social thought and action". This paper seeks to probe what specific features of institutionalization raise collaboration from an informal international R&D partnership to a joint R&D institute, and what kinds of supportive environments lead to the development.

The framework used in this study is based on Cai [49,50] who used an institutional logics perspective to interpret the evolution of the Triple Helix model at the system level. The framework is relevant to this research for two reasons. First, the joint R&D institutes to be discussed in this paper act as hybrid organizations actively operating at the interfaces between the central government, research universities, and international enterprises [26,49,51]. Second, the institutional logics perspective provides an analytical tool to explain the outcome of a process with a certain length of time and to understand the influences of broader social and cultural norms on the cognition and behavior of individuals and organizations [52]. However, since Cai's framework itself is on the analysis on the system level, it will be revised for the use in organizational level analysis.

A joint R&D institute established by Tsinghua University (Tsinghua) and the United Technologies Corporation (UTC), i.e., the Tsinghua-UTC Research Institute for Integrated Building Energy, Safety and Control Systems, was adopted as the case in this research. UTC is an American multinational conglomerate. It researches, develops, and manufactures high-technology products such as aircraft engines, helicopters, HVAC, fuel cells, elevators and escalators, fire and security products, building systems, and industrial products, among others. UTC is also a large military contractor, producing missile systems and military helicopters, most notably the UH-60 Black Hawk helicopter. (https://en.wikipedia.org/wiki/United\_Technologies. (Accessed on 10 November 2019)). Based on a review of the relevant academic literature, the major data source chosen was semi-structured and in-depth interviews (conducted during the periods of 2013–2014, and 2018; N = 15). The interviewees included researchers and administrative staff of the case institute, the university-level administrative staff of Tsinghua (who were responsible for university-industry cooperation or international cooperation), and administrative staff of UTC (who were taking care of university-industry collaboration).

Specifically, this paper seeks to probe the research question: what mingling institutional logics respectively carried by Tsinghua University and the UTC affect the collaboration between both parties moving from informal collaboration toward an institutionalized organization? Based on the research findings, the paper will solicit recommendations to policymakers and practitioners involved in joint R&D institutes between Chinese universities and international enterprises.

The contribution of the study to the existing literature is two-fold: on the conceptual front, it advances theoretical understandings of the interactions of institutional logics which result in varied patterns of joint R&D institutes in a national context with transnational factors; on the empirical front, it examines the evolutionary path of a joint R&D institute established by a flagship Chinese research university and an international enterprise.
