E. Pugliese, L. Napolitano, A. Zaccaria, L. Pietronero
We study the relationship between firms' performance and their technological portfolios using tools borrowed from the complexity science. In particular, we ask whether the accumulation of knowledge and capabilities related to a coherent set of technologies leads firms to experience advantages in terms of productive efficiency. To this end, we analyzed both the balance sheets and the patenting activity of about 70 thousand firms that have filed at least one patent over the period 2004-2013. From this database it is possible to define a measure of the firms' coherent diversification, based on the network of technological fields, and relate it to the firms' perfomance in terms of labor productivity. Such a measure favors companies with a diversification structure comprising blocks of closely related fields over firms with the same breadth of scope, but a more scattered diversification structure. We find that the coherent diversification of firms is quantitatively related to their economic performance and captures relevant information about their productive structure. In particular, we prove on a statistical basis that a naive definition of technological diversification can explain labor productivity only as a proxy of size and coherent diversification. This approach can be used to investigate possible synergies within firms and to recommend viable partners for merging and acquisitions.