secrecy in global economy

Cultural Aspects of Secrecy in Global Economy

Second World Summit on the Knowledge Society, WSKS 2009

Chania, Crete, Greece, September 16-18

Enric Serradell-Lopez; Victor Cavaller

Purpose

• Why one company opt for the secret instead patenting.

• Why some companies have more tendency to the secret than others.

• What aspects of national culture could have more influence in the secret ?


Theoretical discussion

• Some aspects of Intellectual Property Protection: Formal and Informal Methods

– Formal methods: patents, rights of property, commercial marks

– Informal methods: secret, complexity of the design, and first mover advantage


Formal mechanisms of protection

• Patent or not to patent:

– Sword of double edge

– Naked ideas patent


Informal mechanisms

• Trade secrets

• Lead-time strategy

• Complexity of the design

• Defensive publishing


Management of the secrecy

• The policy of the firms in relating to the secrets can be summarized in three points:- Making of secrets

- The protection of secrets

- The stealing of secrets (Dufresne and Offstein, 2008)


Culture and Secrecy

• Culture definition

• National culture: Hofstede’s dimensions– Power distance– Individualism– Masculinity– Uncertainty avoidance


Power distance

The extent of power inequality among members of an organizational society.

• Culture sets the level of power distance at which the tendency of the powerful to maintain or increase power distance and the tendency of the less powerful to reduce them will find their equilibrium.


Uncertainty avoidance

• Uncertainty avoidance: is the extent to which members of an organizational society

try to avoid future uncertainty or ambiguous situations.


Individualism

• Cultural belief and social pattern that individuals should take responsibility primarily for their own interests and those for their immediate family.


Masculinity

• Highly masculine societies place low value on caring for others, cooperation and solidarity.


Hypotheses

• H1: Companies based in higher power distance countries exhibit higher level of

secrecy.

• H2: Companies based in lower uncertainty avoiding countries exhibit a higher level of

secrecy.


Hypotheses

• H3: Companies bases in higher individualism countries exhibit a higher level of secrecy.

• H4: Companies based in more masculine countries exhibit a higher level of secrecy.


Data

• Community Information Survey (CIS3) information

• The classic Hofstede’s survey


Measures• Dependent variable: Proportion of

companies that use secrecy as a method to protect their innovations (Oslo guidelines)

- New or improved products, process, marketing, or organisational method.

• Explanatory variables: 4 dimensions of Hofstede’s survey


Results

Model 1 contains all the explanatory variables: Innovative and non Innovative companies. Global model not significant.

Model 2: Innovative enterprises.

Model 3: non innovative enterprises


Conclusions

• H1: Companies based in higher power distance countries exhibit higher level of

secrecy.

• H2: Companies bases in lower uncertainty avoiding countries exhibit a higher level of

secrecy.


Conclusions

• H3: Companies bases in higher individualism countries exhibit a higher level of secrecy.

• H4: Companies based in more masculine countries exhibit a higher level of secrecy.


Conclusions

• Masculinity affects in a direct form to the level of secrecy– Recognition in jobs is important

– High job stress– Belief in individual decisions– Work very central in the person’s life


Conclusions

• Uncertainty avoidance has an opposite effect to the secrecy– Weak loyalty to employer: short average

duration of employment– Preference for smaller organizations– Scepticism toward technological solutions– Innovators feel independent of rules– Power depends on position and relationships


Limitations and future projects

• Sample

• More cultural index


Thank you !!! Muchas gracias !!

Comments, suggestions, questions...

Enric Serradell-Lopez

Open University of Catalonia, Barcelona, Spain

E-mail: [email protected]


secrecy in global economy

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