Supply Chain Integration, Product Modularity, and Market Valuation: Evidence from the Solar Energy Industry

Davies, Jane; Joglekar, Nitin

doi:10.1111/poms.12052

Cited by 57 publications

(55 citation statements)

References 95 publications

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“…First, firm innovativeness is conceptualized as the extent to which product and process innovation is important to a firm’s strategy, as represented by the firm’s leadership within its industry (O’Brien, 2003). Such leadership is reflected by the firm’s pursuit of new technologies, and its investments in research and development (Chen and Miller, 2007; Davies and Joglekar, 2013). Firms that view innovativeness as a strategic imperative for the firm dedicate more resources toward the development of more, and more novel, new products and processes, than do their peers within their industry (O’Brien, 2003).…”

Section: Innovativeness Product Reliability and Warranty Costsmentioning

confidence: 99%

How firm innovativeness and unexpected product reliability failures affect profitability

Mackelprang

Habermann

Swink³

2015

J of Ops Management

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This study examines relationships among a firm’s innovativeness, its unexpected product failure costs, and financial performance. When a firm chooses to develop more innovative products and processes, product reliability outcomes become more uncertain. These uncertainties in turn may lead to unexpected warranty claims costs, as well as other costs that can erode the advantages of an innovation leadership position. This study empirically tests these propositions using publically reported warranty and financial data from 2003 to 2013, representing 482 unique firms. Consistent with prior studies, our estimation of the direct effects of firm innovativeness on financial performance shows an inverted–u–shaped relationship. Importantly, we find that more innovative firms also experience more unexpected product failure costs, and, consistent with organizational information processing theory, the negative impacts of these costs on financial performance extend well beyond the direct costs associated with remediating warranty claims. Further, we find that this relationship is robust to differing levels of industry innovativeness. Hence, our study suggests that product failure risks associated with firm innovativeness are significant, and act to at least partially offset the financial benefits of innovation leadership. In addition, standard accounting for product warranty claims may substantially understate the true costs associated with product failures, which appear to generate significant SG&A, fixed asset, and inventory costs above and beyond direct warranty processing costs. Our study also demonstrates a novel usage of warranty claims data. We discuss the implications of these findings for both managers and researchers.

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Section: Innovativeness Product Reliability and Warranty Costsmentioning

confidence: 99%

How firm innovativeness and unexpected product reliability failures affect profitability

Mackelprang

Habermann

Swink³

2015

J of Ops Management

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“…• Yu, Jacobs, Salisbury and Enns[42]: Customer satisfaction, financial performance. • Davies and Joglekar[69]: Supply chain valuation, firm valuation. • Schoenherr and Swink[46]: Quality performance, delivery performance, flexibility performance, cost performance.…”

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confidence: 99%

Supply Chain Integration (SCI) measured from an information sharing perspective: Examining its impact on business success

Chatzoudes

Chatzoglou

2015

2015 IEEE 9th International Conference on Research Challenges in Information Science (RCIS)

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During the last ten years, Supply Chain Integration (SCI) has emerged as a key subject of the Supply Chain Management (SCM) literature. Despite its extended empirical investigation, very few studies have placed their focus on the information sharing perspective of supplier, internal and customer integration. On the one hand, numerous scholars theoretically argue that SCI is mainly concerned with the exchange of information, while on the other, very few have empirically examined whether information flows have a significant effect on the effectiveness of the supply chain. The present study examines the effect of SCI (measured exclusively from an 'information sharing' perspective) on customer satisfaction, supply chain performance (SCP) and financial performance. In that direction, an analytical conceptual framework is being proposed. The examination of this framework was made with the use of a newly-developed structured questionnaire that was distributed to a group of Greek manufacturing companies. Supply chain managers were selected as key respondents, due to their knowledge and expertise. After the completion of the research period, 253 usable questionnaires were returned. The reliability and the validity of the questionnaires were thoroughly examined, while research hypotheses were tested using the "Structural Equation Modeling" (SEM) technique. Results offer interesting empirical observations and managerial implications.

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“…Commonly used in political and socioeconomic research, Davies and Joglekar [17] previously used this technique to assess the market valuation of publicly traded clean technology organizations. Through the information available in the public filing of statements for the ARPA-E funded projects and the project websites, we examine the specifications for each funded project to identify references to technology performance, development, deployment, and market growth for each technology.…”

Section: Methodsmentioning

confidence: 99%

Managing Highly Innovative Projects: The Influence of Design Characteristics on Project Valuation

Erzurumlu

Davies

Joglekar

2014

IEEE Trans. Eng. Manage.

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The climate change debate and economic recovery strategies in various industries demand highly innovative projects featuring stretched performance goals for developing clean technology. These projects face multiple sources of uncertainty in high risk situations, and require specialized know-how and longer periods for revenue growth than their counterparts in other industries. We use data from 207 clean technology projects funded by the U.S. Advanced Research Projects Agency-Energy to conduct a comparative study of how operations design can hedge risk and enhance project valuation in technology development and deployment stages. We find that deployment feasibility is significantly and positively related to project valuation. On the other hand, stretched technical performance goals, development feasibility and market growth targets are associated with lower valuation. We also find some significant differences for these results across institution types: mature firms, start-ups, universities, and research centers. We examine the risk profile of these projects by technology and institution type, and discuss the managerial and policy implications for these findings. Index Terms-Advanced Research Projects Agency-Energy(ARPA-E), clean technology, government funding, innovation management, operational hedging, operations design, resource-based view (RBV), risk management, technology entrepreneurship.

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Supply Chain Integration, Product Modularity, and Market Valuation: Evidence from the Solar Energy Industry

Cited by 57 publications

References 95 publications

How firm innovativeness and unexpected product reliability failures affect profitability

How firm innovativeness and unexpected product reliability failures affect profitability

Supply Chain Integration (SCI) measured from an information sharing perspective: Examining its impact on business success

Managing Highly Innovative Projects: The Influence of Design Characteristics on Project Valuation

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