Enhancement of product development capabilities of OEM suppliers: inter‐ and intra‐organisational learning

Abstract

PurposeFaced with increased global competition, suppliers must continually update their technology and capabilities to effectively respond to the rapid changes in customer requirements. In the original equipment manufacturer (OEM) supply relationships, it is particularly important for suppliers to enhance their product development capabilities by learning from customers. However, few existing studies have empirically explored this issue. This paper aims to fill some of the gaps.Design/methodology/approachBased on the organisational learning perspective, this paper investigates learning between the suppliers and customers of OEM relations as well as its impact on suppliers' product development capabilities. Structure equation modelling was used with data collected from 147 OEM supply relations of 117 Taiwanese information technology (IT) companies. The relationships among learning intent, interactive learning, internalised learning, and product development capabilities were examined.FindingsResults show that suppliers with a high learning intent are able to facilitate inter‐organisational and intra‐organisational learning to enhance their product development capabilities.Originality/valueThe paper proposes and empirically tests a model to explain how the OEM suppliers' product development capabilities are enhanced by the relationships between learning intent, inter‐organisational learning, and intra‐organisational learning.