The Department of Industrial Economics and Strategy is a strategy-oriented department based on modern organisational economics. The Department's research field is the "organisation of economic activities".
The primary purpose of the Department is to contribute to an understanding of the economic organisation of society and, in particular, how and why activities are organised in markets, enterprises, business sectors and other "institutions".
By way of example, the Department examines why much biotech research takes place in small dedicated enterprises and more rarely in large pharmaceutical enterprises, and why so far musicians have entered into separate contracts with record companies and concert promoters instead of an overall contract covering both activities.
The Department hosts a number of substantial, externally funded projects such as DRUID, CISTEMA and COMBI and participates actively in the Biotech Business, Imagine and LEFIC centres.
The Department researchers teach the MSc. (IES hosts the MIB line), BSc. in Economics and Business Administration, BSc. in Business Administration and Commercial Law, FT-MBA and Summer School programmes. The Department also contributes to the development and teaching of BSc. courses in Business Economics and Communication and Business Economics and Psychology.
The Department has an active PhD environment.
The Department has a total staff of about 40, of whom 16 are permanent associate professors/full professors.

Highlights of 2004

The Department co-founded two centres: Biotech Business and Imagine.
The Department took over the editorship of the Industry and Innovation journal.
The Department received two funding allocations to examine "Talent, technology and tolerance in European cities".
The Department was a co-applicant to the successful application for the DIME "Dynamics of institutions and markets in Europe" project under the sixth EU framework programme and chairs the project board.
The Department was allocated three co-financed PhD studentships from the Danish Research Agency.
The Department provided six PhD courses focusing on research design, methodology and publication.

Academic profile

The Department conducts strategy-oriented research with its academic basis in modern economic theories, including, among others, transaction cost economics theory, principal-agent theory, contract economics and information economics, all covered by the broad term of "organisational economics". It is also strongly inspired by insights from sociology, psychology and geography.
The Department's research field may be described as the "organisation of economic activities". Researchers recognise the dynamic nature of all types of organisations. What is optimal at one point in time will not necessarily be optimal at another. Thus, the Department's research has an important dynamic dimension and definitely belongs to the field of research called "industrial dynamics".
Research at IES is characterised by an interest in understanding the reason for the organisation of economic activities in various forms of organisation with their special structures of knowledge and incentives.
The Department's contribution to CBS' profile therefore lies in the strategic area: How are enterprises organised and what are their limits to obtain maximum competitiveness? It is implemented by way of competition strategy, technology strategy, human resource management, knowledge management or – using a new term – organisation strategy.
The Department's research is therefore often conducted against a highly concrete empirical background with a view to understanding real-world phenomena. Thus the Department has a long-standing tradition of research in innovation and technology-related topics, and these areas remain a major element of its research field.
One of the strengths of the Department is that it has deep and detailed empirical knowledge of the research fields addressed based on combinations of interviews, surveys, register data and many types of secondary sources. As a result, the Department has competences within a wide array of empirical methods from case-based research to pure econometrics.

The Department's research can be categorised in the research areas below.
The research areas are categorised according to research topics, and all Department researchers contribute to more than one area. The Department centres are placed under the relevant areas. Neverthless, because of its more general nature, DRUID has not been included under a particular category. (Only for the website version: Click the relevant headings to get a more detailed description of the areas, including the related projects.)

A. Innovation studies:
? Organisation of innovation
? Appropriability of innovations and intellectual property studies
? Institutional environment for innovation
? University-industry relations
? Innovation management and strategy
? User-producer relationships.

Related business research centre: Biotech Business

B. Industrial dynamics:
? Industry analysis
? Regional studies, industrial clustering and agglomeration studies
? Labour market dynamics
? The dynamics of market organisation
? Project-organised industries.

Related business research centre: Imagine .. Creative Industries Research

C. Types of organisation:
? Make-or-buy decisions
? Outsourcing
? Corporate/technology strategy
? IPR strategy
? Theory of the company
? Resource-based theories.

D. Law and Economics:
? Contract theory
? Industrial economics
? Intellectual property theory.

Related business research center: LEFIC

E. Research methods:
? Theory of science
? Economic modelling
? Statistical/econometric methods
? Case studies.

Research strategy

The Department regards research activity relevance as the ultimate criterion for good research. Its research results should benefit society in one way or another. In a university department this should be achieved primarily through teaching. Nevertheless, the Department is increasingly presenting research results directly to players in the business community and the wider society – a fact which may serve as a source of inspiration and stimulation to research activities.

But regardless of whether the research results are communicated through teaching or more directly to the users, as a general rule they must be subjected to "quality control". In view of the uncertainty as to the applicability of research results it is crucial that the research results are of top quality. In light of the increasing specialisation of research, the quality control will often be conducted in the international research environments. To present research results in international research forums and to publish them internationally is therefore a crucial prerequisite of documenting research quality. International publication is therefore a necessary part of the Department's research obligation.

Hence, the overall, long-term research objective of the Department is to obtain a position as an internationally recognised department in the fields of organisational economics and strategy. Publication in recognised international journals is the most important means of achieving this objective. The Department considers journals such as Research Policy and Industrial and Corporate Change academically highly suitable, but it also wishes to contribute to broad-spectrum top journals in the business economics field such as Academy of Management Journal and Strategic Management Journal and to other relevant and highly ranked journals. The Department objective is to keep publication at a level of at least one article published in an international journal per year for permanently employed researchers.

The Department's research is organised as a combination of individual projects, joint authorships and major projects, typically with external funding.

External funds finance projects with independent research plans adapted to and supporting the Department's research profile. The Department aims to pursue a high degree of external funding, not least in order to be able to retain a fair number of PhD students.

In 2004, the Department portfolio of externally funded projects included the following major projects:
COMBI (Competence, Organization and Management in Biotech Industries)
DRUID (Danish Research Unit for Industrial Dynamics)
CISTEMA (Center for Interdisciplinary Studies in Management of Technology)
The "Biotechnology Innovation in the Öresund Region" Ø-forsk programme
RIPE (Setting up an International Junior Faculty Network for the Research on Intellectual Property Economics)
"Talent, Technology and Tolerance in European cities".

In 2004 the Department had external research funds of more than DKK 7 mill. at its disposal. By way of comparison, the CBS allocation amounted to approximately DKK 6.5 mill.

In general, the Danish Social Science Research Council (formerly SSF, now FSE) is the Department's key source of external funding.

Research results

For many years, IES has been among the most published departments of the Faculty, and this was also the case in 2004. The Department publishes mainly in English in a deliberate effort to be a part of the international research environment. The Department also gives priority to publication of research results in refereed journals.

Over the last six years the number of such articles has averaged 14 per year, and in 2004 it was 13. An analysis of the quality of the journals concerned shows that based on qualitative rankings and more objective impact goals, the quality of the journals has improved in recent years. It should also be noted that in 2003 a very productive researcher (Nicolai Foss) left the Department.
In order to illustrate another aspect of the research activities, the number of reviews conducted by Department researchers for international journals were counted. 50 such reviews were conducted in 2003, and in 2004 this number had increased to more than 80, which is evidence of a major – and hitherto concealed – effort contributing to the development of international research communities. Add to this the extensive review work performed in connection with the organisation of major international conferences (the DRUID conferences in particular).

As a natural extension of these activities, in 2004 the Department took over the editorship of the Industry and Innovation journal, which will contribute significantly to the Department's international visibility in the area of Industrial Dynamics.

Research relations to practice

As mentioned under the academic profile, to a wide extent the Department's research is aimed at real-world, practical issues of organising activities in the business community and the society in general. The Department's research activities are thus inspired by research itself and by its surroundings. The Department's researchers therefore have a long-standing tradition of collaborating with enterprises and other organisations, primarily to identify relevant issues and to retrieve data. This type of activity often leads to invitations to participate in the strategic considerations of such players.

In 2004, the Department's most important contribution to this collaboration came from the two new centres: Biotech Business and Imagine... Both centres had a very close dialogue with central business players in connection with their start-up.