Supplier Involvement in New Product Development under Technological Uncertainty

Abstract

This thesis addresses the challenges that firms are faced with when collaborating with suppliers in new product development (NPD) projects under technological uncertainty. A critical observation that is made in this context is that technologies are evolving faster, making products more complex. At the same time, firms become more specialized. Due to increased complexity and specialization, firms do not possess all the necessary technologies in-house and therefore need to collaborate with external organisations to incorporate new technology into their products. Common collaborators are suppliers who become integrated into the buying firm's NPD project. Scholars and practitioners alike have stressed the importance of involving suppliers in NPD (Takeishi, 2001;Petersen, Handfield, & Ragatz, 2005;Silverstone, Wallis, & Mindrum, 2012;Tevelson, Alsén, Rosenfeld, Benett, Farrell, & Zygelman, 2013). However, finding suppliers and collaborating with suppliers in NPD can be problematic. In addition, external collaborations also impact the buying firm internally, since it often needs to coordinate its departments. Supplier involvement in NPD has been studied for decades (for an overview of the field see Johnsen, 2009), however, little is known about the impact of technological uncertainty in these settings. Consequently, the purpose of this thesis is to explore supplier involvement in NPD under technological uncertainty.The research in this thesis is based on six case studies that were conducted at two large system integrator firms: ABB and Ericsson. In total, 53 interviews and two workshops were conducted to collect relevant data. The thesis consists of a compiled summary and five appended papers. The framework that is developed in the thesis highlights that challenges in supplier involvement in NPD projects under technological uncertainty can be divided into challenges that are related to supplier selection, buyer-supplier collaboration, and internal coordination between R&D and purchasing. The main findings of these studies revolve around the identified challenges.Challenges in supplier selection are concerned with the issues of involving new suppliers or relying on old acquaintances, managing uncertainties, the dilemma of whether to commit to long-term relationships or to maintain flexibility, and deciding on which department that is responsible for evaluating and selecting the supplier. The present study of buyers and suppliers in NPD, shows the challenges that are involved in balancing control, reaching goal alignment, and managing transactional and relational governance. Internal challenges investigate the coordination between the R&D department and purchasing in NPD projects where suppliers are involved. The results of the study indicate that, in projects with high technological uncertainty, there is limited coordination between the R&D department and purchasing since purchasing had but little involvement in these projects. There is organisational separation however, where purchasing is mainly responsible f...

Organizing supplier interfaces in technological development

“…In today’s business landscape, technological development is not controlled by single companies, but rather organized in collaboration between companies. As a consequence, it is becoming increasingly important for companies to work together with suppliers on innovation and product development (Brem and Tidd, 2012; Caputo and Zirpoli, 2002; Melander, 2014; Wagner and Hoegl, 2006; Wynstra et al , 2001). Given that companies cannot own all necessary resources, suppliers are increasingly seen as collaboration partners rather than opponents.…”

A Comparative Study on New Product Development Projects: Supplier-client Partnerships in Manufacturing Industry

“…The available literature in the supply chain regarding this subject, in general, have compiled with less written about criteria for supplier involvement and relationship factors, supplier selection, and cultural environment and collaboration in NPDP. The methodology followed in this paper is as suggested by [13]. Melander [13] attest that a case study is a phenomenon and is recommended for the study of a complex unit with multiple variables especially in trying to understand a phenomenon.…”

“…The methodology followed in this paper is as suggested by [13]. Melander [13] attest that a case study is a phenomenon and is recommended for the study of a complex unit with multiple variables especially in trying to understand a phenomenon. The logical approach to this work is presented in…”

The role of openness in collaborative innovation in industrial networks: historical and contemporary cases

“…The past three decades of extensive research on technological innovation in industrial networks constitutes the theoretical background to the present paper. It has given us knowledge, inter alia, about the role and functioning of supplier relationships (Pedersen, 1996;Gadde and Snehota, 2000;Johnsen and Ford, 2007;Melander, 2014) and customer relationships (Ritter and Walter, 2003;Öberg, 2010). In more recent years, growing interest can be observed in start-up companies and their interactions with various types of counterpart (Aaboen et al, 2017;Baraldi et al, 2019;Laage-Hellman et al, 2020).…”