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Although research on how the downstream calculations of a patent’s profit potential influence invention renewal decisions is extensive, the impact of the upstream knowledge creation stages is overlooked. The purpose of this study is to address this theoretical vacuum by examining the intra-organizational configuration of knowledge networks and collaboration networks.

The data consist of 491 global pharmaceutical firms that patent in the USA. Drawing on patent records, the authors simultaneously construct intra-organizational knowledge networks and collaboration networks and identify network cohesion features (i.e. local and global). The authors employ panel fixed-effects models to test the hypotheses.

The results show that local knowledge cohesion and local social cohesion decrease invention renewals, while global knowledge cohesion and global social cohesion increase renewals. Moreover, the marginal effects of local and global social cohesion are stronger than those of local and global knowledge cohesion, respectively.

The hypotheses are tested using the pharmaceutical industry as a research setting, which limits the generalizability of our findings. In addition, potential formal and informal contingencies are not considered.

Despite its limitations, this study provides valuable implications. First, managers are cautioned against the adverse effects of local cohesion structures on invention renewal. Second, firms can dynamically adjust their local and global network configuration strategies to harmonize the generation of valuable inventions and the retention of good ideas.

Complementary to previous research that focused on inventions’ performance feedback, this study delves into upstream knowledge creation stages to understand invention renewals.

Theories are crucial for addressing research questions and advancing the boundaries of knowledge. However, in the field of strategic management, the existence of diverse schools of thought from various disciplines, including economics, politics, and sociology, poses significant challenges for researchers seeking to develop theories for argumentation and theorization. In this study, we have conceptualized a novel approach to selecting an appropriate theory for addressing specific research questions.

Thought experiment, disciplined imagination, and a conceptual examination of a diverse set of theories.

Because the central focus in the field of strategic management revolves around how firms achieve sustainable high performance, a research question should initially clarify the fundamental phenomenological issues it aims to address. Subsequently, the process of problematization should identify the ontological assumptions and premises that establish a connection between the research question and existing theories. Finally, the identification and abstraction of rhetorical concepts derived from these assumptions and premises lead to theory selection criteria, namely connectedness, reliability, parsimoniousness, and falsifiability.

Although we believe that our model for theory selection is generalizable to a wide range of management disciplines, we have primarily focused on its application in the field of strategic management. Future work could validate and further explore the applicability and effectiveness of this model in selecting appropriate theories for conceptual development in other domains.

While many researchers have proposed methods for writing theoretical papers, few have provided suggestions specifically focused on theory selection. This paper stands out as one of the few that not only attempts to address this gap but successfully develops a comprehensive model for theory selection.