Protection and internal transfer of technological competencies: The role of causal ambiguity

The purpose of this paper is to study how causal ambiguity around technological competencies can help firms to achieve superior performance.

Traditionally, it has been recognised that causal ambiguity of technology represents an effective protection against imitation. Recently, however, researchers have unearthed evidence that the effects of causal ambiguity also could be extending to the interior of the firm itself, hampering the diffusion of its own technological capabilities among its managers. In this case, the existence of causal ambiguity of technology will have a negative impact on firm performance. In this paper both effects are studied in a sample of 258 Spanish manufacturing firms using several statistical techniques.

The results indicate that causal ambiguity exerts a double‐edged influence on firm performance. On the positive side, by protecting technological competencies from imitation and, on the negative, hampering the diffusion of these capabilities within the firm, with this second effect being stronger.

The main limitation of this work is that there are clearly many other factors that can explain firm performance apart from causal ambiguity of technology. However, as the main objective of the present work is to study the relations between causal ambiguity around technological capabilities and firm performance, it did not seem wise, for operational reasons, to complicate the analysis by including other variables.

In order to achieve better results, firms must use causal ambiguity around technological competencies to protect these competencies against imitation and should make great efforts to diffuse them within the firm.

The results obtained allow one to make a contribution to the debate existing on the literature about the influence that causal ambiguity around technological competencies has on firm performance.