In Chains? Automotive suppliers and their product development activities (original) (raw)
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Journal of Product Innovation Management, 2010
In the literature on interorganizational collaboration in product development, considerable attention is given to supplier role classifications. Such classifications often link to a supplier's position in the overall supply chain, but the claim that this position has a substantial impact on its product development activities has seldom been empirically validated. The results from the present survey among Swedish automotive suppliers demonstrate that supplier product development activity is significantly affected by the position of the supplier in the supply chain and the supplier's strategic focus on innovation. While the latter has a stronger impact on product development activities, there is also an interaction effect implying that the effects of a supplier's innovation strategy are contingent on its supply chain position. Contrary to expectations, customer development commitment does not have any significant direct effect on supplier product development activities. Instead, this relation is fully mediated by supplier innovation strategy. These findings imply that, in contrast to conventional wisdom, product development activities are not strictly organized in ''chains.'' Although supply chains can be useful metaphors for understanding the distribution of regular production activities between firms, they arguably apply less to the distribution of product development activities.
The path of innovation: purchasing and supplier involvement into new product development
This paper aims to investigate the effects of supplier collaboration on the firm innovation performance as well as the enabling characteristics of the purchasing function. This is an original contribution as few papers empirically test the effect of supplier collaboration (meant as supplier involvement, development, and integration) on innovation performance and — simultaneously — the contribution of strategic sourcing activities and purchasing knowledge. Also, we explore the technological uncertainty of the purchase as an important contingent factor that might influence the firm's innovation strategy and the emphasis on supplier collaboration or strategic sourcing. Towards this end, we develop a theoretical framework and test it through a survey conducted on a sample of 498 companies worldwide. Results show that innovation, as a category priority, does lead to emphasize supplier collaboration and strategic sourcing which, in turn, ensure better innovation performance. Empirical evidence also shows that, on the one hand, adequate purchasing (managers) knowledge enables greater supplier collaboration and strategic sourcing; on the other hand, technological uncertainty put greater emphasis on innovation strategy as well as on strategic sourcing.
The Drivers of Cooperation Between Buyers and Suppliers for Product Innovation
This article reports the results of an empirical study that probed the adoption of Early Supplier Involvement (ESI) in the product development process. ESI is defined as a form of vertical cooperation where manufacturers involve suppliers at an early stage in the product development / innovation process, generally at the level of concept and design. Previous research has shown that Western automobiles manufacturers obtained significant benefits by emulating the ESI practices of their Japanese competitors; the bulk of research knowledge is, in fact, located in this domain. This study focused on a group of assembly-based industries outside the automotive setting to determine if the adoption and benefits of ESI are found in other domains as well. Twenty-five companies in three non-automotive industries participated in the research. A model of ESI adoption was developed and tested, and an ESI index created to determine the degree to which this practice was applied. The results reveal, among other things, that the level of ESI practice is strongly related to a higher number of supplier base initiatives, lower product integration, broader supplier scope and a higher proportion of parts purchased. Significant results were also obtained in comparisons between industry sectors and geographic regions (USA, Western Europe and Japan). We suggest that promising directions for future research include broad based samples across industrial sectors and industry-focused empirical study.
The Asian Journal of Technology Management (AJTM), Vol 1 No 1 2014
The local automotive suppliers are facing a number of important challenges such asglobalisation, new requirement in market specifications and the competition brought about by theAsean Free Trade Area (AFTA) agreements. In an effort to enhance the competitiveness of themanufacturing sector, the government has implemented the Second Industrial Master Plan, IMP2(1996-2005). The focus of the IMP2 is more on innovation and applications of new technologies, sothat industries can move up the value chain of their activities. Innovative capabilities achieved fromcompanies’ new product development activities have been recognized to be crucial for companies tosustain their competitiveness and organisational success. The importance of product development ismost obvious in the context of the discussion on the competitiveness of the Malaysian automotivesuppliers. The study will focus on the small medium enterprises (SMEs) that make up more than 60 %of these automotive suppliers. The study is to determine the extensiveness of the suppliers’ productdevelopment activities by examining the involvement of the suppliers in customer’s productdevelopment activities. Consequently, the impact of this involvement to the competitiveness of thesuppliers is examined. The results were established based from a survey to parts and componentssuppliers of Proton, the Malaysian car national assembler. The study has shown that the SMEs wereinvolved from the early stages of the product development process that is during the design stage. Theproduct development efforts have shown to contribute towards increasing firms’ market share andfirms were also able to gain a better understanding of future product demand. A significant number ofthe suppliers have managed to penetrate the export market. Unfortunately, among the respondents,there is only one system supplier. This indicates that, either the technological capabilities of theSMEs still needed upgrading for the requirement as a system suppliers or it may not be the onlydeciding factor for suppliers to be chosen as system suppliers. It is intended that this paper shouldserve to inform management in particular the suppliers on the present status of the SMEs in seekingto improve their competitiveness from product development effort. Keywords: Product development, SMEs, automotive suppliers, competitiveness
The Journal of Technology Transfer
Existing research highlights the importance of sourcing external knowledge in manufacturers’ innovative processes. Specifically, supplier involvement in new product development (NPD) has been widely analysed but without conclusive results. To shed light on this matter, this paper provides a deeper insight by analysing the indirect effects in the relationship between supplier involvement and two NPD dimensions (efficiency and effectiveness). In particular, it examines R&D collaboration with supporting organisations as a mechanism by which knowledge provided by suppliers may lead to better innovation performance. This study focuses on 155 high-tech and medium–high-tech Spanish firms to test indirect effects through the PROCESS macro. The results show that while there is a positive and significant indirect effect of supplier involvement on NPD efficiency through R&D collaboration with supporting organisations, that indirect effect is not significant in increasing NPD effectiveness. Thi...
Inside the tier model : product development organization and strategies in automotive supplier firms
Thesis (Ph. D.)--Brunel University, 1997. Over the last five to ten years much attention has been paid to the implementation of Japanese-inspired lean production in Western manufacturing industry, in particular in the automobile industry. Current and past research into the changing role of suppliers in this context has identified increasing product development responsibility as one of the major challenges in the automobile component sector. However, the debate has mostly been focused on the carmakers' outsourcing strategies and the transformation of the largest players in the component sector, i.e. the system suppliers. The present research analyses a specific group of suppliers, namely medium-sized expert suppliers. These are companies present both in the first and second tier, with an explicit strategy of supplying components which provide a value added function, largely dependent on their own R&D efforts. The research focuses on product development organization and strategies...
Improving Supplier New Product Development Performance: The Role of Supplier Development
Suppliers play an increasingly central role in helping firms achieve their new product development (NPD) goals. The literature implicitly assumes that suppliers are able to meet or exceed the quality standards and technological expectations of the firm, and yet, in practice, suppliers often lack the technological capabilities needed to undertake collaborative NPD. In such situations, a firm may choose to intervene and actively develop the supplier's technological and product development capabilities. We develop a theoretical framework that conceptualizes supplier development activities within interorganizational NPD projects as part of a bilateral knowledge-sharing process: design recommendations , technical specifications, and new technology flow from supplier to the firm, and in turn, the firm can implement supplier development activities to upgrade the supplier's technological capabilities. Antecedents (supplier responsibility, skills similarity, single sourcing strategy) and consequences of supplier development activities (on supplier, product, and project performance) are examined using a sample of 153 interorganizational NPD projects within UK manufacturers. We find broad support for our hypotheses. In particular, we show that the relational rents (in the form of improved product and project performance) attained from supplier development activities in new product development are not achieved directly, but rather indirectly, via improvements in the supplier's creative and technological capabilities. Our results emphasize the importance of adopting a strategic view of the potential returns available from investing in the NPD capabilities of key suppliers, and provide clues about underlying reasons for the suboptimal experiences of many companies' collaborative NPD projects.
Journal of the Academy of Marketing Science, 2014
Drawing on social exchange theory, this study develops a longitudinal theoretical framework of supplier participation in buyers' new product development (NPD) activities. The study focuses on the longitudinal temporal dynamics of supplier involvement in buyers' new product development and postulates that working relations and inter-dependence impact suppliers' attitudes toward co-innovation and suppliers' co-innovation behaviors. Applying this framework to a 10-year longitudinal dataset from the North American automotive industry, the drivers of the escalation of supplier involvement in buyers' NPD over time and the effect of this involvement on innovation performance, buyer sales performance, and supplier sales performance are identified. The results indicate that buyer-supplier communication, suppliers' anticipated long-term returns, suppliers' trust of a buyer, and supplier-buyer inter-dependence all play a significant role in changing supplier attitudes toward co-innovation and supplier involvement in a buyer's NPD. Further, the study also shows that supplier involvement in buyer new product development is mutually beneficial for both the buyer and the supplier as it increases performance of both parties. Performance returns are actually greater for suppliers than for buyers. As such, this study contributes to both relationship management and new product development literature streams, as well as providing practical direction to manufacturers as to how they can increase suppliers' involvement in their NPD to benefit both parties.
Collaborating with suppliers in product development: a US and Japan comparative study
IEEE Transactions on Engineering Management, 1999
Despite its risks, an increasing number of buyers share design work with their suppliers. However, the outsourcing of design work has been relatively neglected in the literature. Based on mail survey data from 174 U.S. and 122 Japanese automotive component suppliers with product design capability, this study investigates the degree of supplier involvement in design and the factors leading to supplier involvement. The two strongest predictors of the degree of early supplier involvement in design in both Japan and the United States are the degree of technological uncertainty and supplier technical capabilities. Automotive companies are more likely to outsource designs of high uncertainty and select suppliers of high technical capability for design outsourcing. Technological uncertainty also has interaction effects-in the United States, high uncertainty makes customers want to give greater design responsibility to highly technically capable suppliers and those who are most dependent on them as a percent of supplier sales. Overall, the study supports notions of convergence between the U.S. and Japanese supplier management practices in joint product development.
Journal of Purchasing and Supply Management, 2009
Purchasing and supplier involvement as one possible explanatory factor of product development success has been gathering growing attention from both managers and researchers. This paper presents the results of a Dutch benchmark study into supplier involvement in product development, and discusses the topic more specifically in the context of the food industry. Regarding supplier involvement, this industry has not been studied intensively, although its specific characteristics make continuous development of new products imperative and the amount of outsourcing of production and development has increased substantially. The benchmark was conducted by means of an existing framework which has not yet been applied to the food industry. The food company in the benchmark study performs consistently better than companies from other industries. At the same time, the results of a similar case study carried out at a Scandinavian food company show contradictory results. By comparing the Dutch and the Scandinavian case, we illustrate that our analytical framework can explain these different results in terms of the underlying processes and pre-conditions, thereby validating its application to the food industry. D