This book extends Rumelt's (1974) definition of relatedness in two ways. First, it argues that similarity and complementarity are two independent forms of relatedness which must both be evaluated. Second, it argues that Rumelt's third dimension should be partitioned because science and technology are two different forms of knowledge which influence firm innovation, and subsequently performance, differently but interactively. It is advanced that the interplay between science and technology relatedness affects the types of innovations produced. The insights from this theory are extended to collaborative R&D.