Innovative Supply Research Articles

External Technology Supply and Client-Side Innovation

Flexibility in response to competitive pressure from globalized markets and increasingly individualized customer desires has become vital for firms. A common strategy to address this challenge is to employ a dynamic concept of organization and reach beyond the boundaries of the firm. Accordingly, technology transfer from providers of knowledge intensive business services attracts more and more attention. In this context we focus on external supply of information technology and client-side innovation. The aim of this paper is to contribute to resolving an empirical puzzle arising from the prior literature. Some authors find beneficial effects of IT outsourcing, others underline that firms often fail to achieve expected strategic goals. Our stylized theoretical model combines a knowledge production function framework and transaction cost economics. We hypothesize that the right balance between internal and external knowledge is critical for innovation. The empirical application is German firm-level data covering a wide range of industries from 2003 to 2006. Our results largely support the theoretical arguments and suggest a positive linear relationship between the level of outsourcing and process innovation. For product innovation we find a hump-shape.

Examining Double Marginalization Effect for Innovative Product Supply Chain

Double marginalization effect refers to the phenomenon that when both upstream and downstream firms have monopolistic power, customers pay higher retail price and firms make less profit than when the supply chain is vertically integrated (Tirole, 1988). Although double marginalization effect has been extensively studied in the context of supply chain management for mature products, very limited attention has been given to innovative products whose demand is generated through word-of-mouth effect. The authors study the pricing decisions in a supply chain that sells innovative products. Using a modified Bass diffusion model to capture demand trajectory over time, the authors identify the optimal way for the retailer and supplier to adjust prices when profit is not discounted, and also provide numerical examples when profit is discounted. The authors show that (1) when profit is not discounted the optimal retail prices are adjusted over time, while the optimal wholesale price should be kept as a constant, and (2) double marginalization effect also exists in an innovative product supply chain, but its degree depends on a number of factors, such as the innovation and imitation coefficients.

Accessing Supplier Innovation By Being Their Preferred Customer

OVERVIEW:In the context of open innovation, firms increasingly rely on the collaboration of suppliers in their innovation processes. However, not all competent suppliers are willing to collaborate with all buyers, which is why achieving preferred customer status with key suppliers becomes important. This paper presents the results of a consortial benchmarking project that studied the supplier relationship management tactics of several best-practice firms. It identifies characteristics of suppliers who innovate well with their customers and emphasizes the importance of a firm establishing itself as an attractive customer as a prerequisite of successful buyer-supplier collaborations. This paper proposes additional sourcing criteria to identify innovative suppliers and introduces a supplier portfolio model based on customer attractiveness and supplier competence.

A 'living laboratory' environment for exploring innovative RFID-enabled supply chain management models

The purpose of the paper is to present a ‘living laboratory’ research environment, analyse its role for exploring innovative supply chain models, and discuss the methodological approaches used in the laboratory during the front-end phases of a new product/service development process. The research approach relies on an open innovation platform characterised by ‘users as innovators’ cooperating in an open and independent research environment to envision, design, negotiate, develop, test and validate emerging supply chain models. Results indicate that the ‘living laboratory’ represents an alternative research environment, which is particularly well fitted for exploring emerging phenomena such as RFID-enabled supply chain management models as it provides appropriate support to networked innovation collaborative processes.

Supply Chain Contingencies: The Effects of Up-Stream Directives on Supplier's Innovation Performance

:Firms are increasingly organized in supply chains to increase value at less cost to the supply chain as a whole. Recently, firms have expanded their routine processes of the supply chain to innovation processes. An improved transfer of information and collaboration across partners augments innovation in the supply chain. Downstream partners provide timely information about customer preferences and new trends. Upstream partners can provide knowledge of new technological solutions earlier. The coordination of the new product development process along the supply chain is difficult. Suppliers face upstream directives set by original equipment manufacturers who strive to improve the coordination of multiple suppliers' innovation components; yet, the performance implications of upstream directives are unexplored. This article opens the black box of upstream directives. It shows that upstream directives can improve innovation although at casual glance might distract from creative work and as such hamper innovation.

Utilizing Industry-led Innovation Capacity to Enhance Supply Chain Performance : An Empirical Study

A fundamental principle of the resource-based (RBV) of the firm is that the basis for a competitive advantage lies primarily in the application of bundles of valuable strategic capabilities and resources at a firm's or supply chain's disposal. These capabilities enact research activities and outputs produced by industry funded R&D bodies. Such industry lead innovations are seen as strategic industry resources, because effective utilization of industry innovation capacity by sectors such as the Australian beef industry is critical, if productivity levels are to increase. Academics and practitioners often maintain that dynamic supply chains and innovation capacity are mechanisms most likely to deliver performance improvements in national industries. Yet many industries are still failing to capitalise on these strategic resources. In this research, we draw on the resource-based view (RBV) and embryonic research into strategic supply chain capabilities to investigate how two strategic supply chain capabilities (supply chain performance differential capability and supply chain dynamic capability) influence industry-led innovation capacity utilization measured through perceptions of supply chain operatives of superior supply chain performance enhancements. Two models compare the influence of size of supply chain operatives on these factors and their relationships. Results indicate that both small and large supply chain operatives in this industry believe these strategic capabilities influence and function as second-order latent variables of strategic supply chain capability. Additionally the study confirms that size of the supply chain operative influences how the respondents perceived strategic capabilities influence supply chain performance enhancement expected from utilizing industry-led innovation capacity in this industry.

The Bright Side and Dark Side of Embedded Ties in Business-to-Business Innovation

Although the number and importance of joint innovation projects between suppliers and their customers continue to rise, the literature has yet to resolve a key question: Do embedded ties with customers help or hurt supplier innovation? Drawing on both the tie strength and knowledge literatures, the authors theorize that embedded ties interact with supplier and customer innovation knowledge to influence supplier innovation. In a sample of 157 Dutch business-to-business innovation relationships, they observe that embedded ties weaken how much suppliers benefit from customer innovation knowledge because of worries about customer opportunism (the dark side of embedded ties). However, they uncover three moderating relationship and governance features that allow suppliers to overcome these dark-side effects and even increase innovation (the bright side of embedded ties). Finally, although the authors predicted a bright-side effect, they find that embedded ties neither help nor hinder the supplier to leverage its own innovation knowledge in the relationship.

Incorporating social context and co-evolution in an innovation diffusion model—with an application to cleaner vehicles

Existing diffusion models have proven less suitable for the analysis of environmental innovations, such as hybrid vehicles, which emerge in a context of changing social appraisal and regulatory support. In this paper, we offer an agent-based analysis of innovation diffusion which is better suitable for those cases. We explore future scenarios of car engine technology with support of a simulation model. In the model, actor behavior is modeled explicitly on the basis of actor frames and the consequent appraisal of technology options by potential adopters and by suppliers. The model is analytically novel in that it incorporates five feedback loops: interactive learning between suppliers and users, scale and learning economies, endogenous taste formation among consumers, and social learning (attribution of meaning). In the model, consumer decisions influence each other and the supply of innovation by shaping R&D and investment decisions of suppliers. The model is applied to explore future diffusion scenarios of clean vehicles, though it starts with simulating recent historic trends, including the quick diffusion of direct fuel injection systems and slow diffusion of electric vehicles in the last 20 years. It is shown that the success of hybrid electric vehicles critically depends on suppliers shifting towards HEV development and production (resulting in greater supply of HEV models) and on consumers valuing hybrid electric vehicles more than environmentally improved diesel vehicles.

Innovative Supplier Management Processes for Sustainability - Explorative Findings from German Stock Corporations

Companies which have to manage global supply chains face a high level of complexity in that there is a large number of suppliers in diverse socio-economic contexts as well as a growing demand for control of social and environmental criteria in these supply chains. Sustainable supply chain management (SSCM) therefore argues for the need to consider social and environmental next to economic aspects in the management of supply chains. This integration can only be achieved by process innovations, in the way that sustainability criteria are integrated into the key processes of supplier management (evaluation, selection, and development). The presented survey-based exploratory study focuses on these processes in large German stock corporations. The results show that some companies are already considering sustainability aspects in their supplier management processes. Moreover, processes which are easier to implement, such as written requirements and standards, are more often implemented than resource-intensive processes of evaluation and audits. At the same time, the increasing importance of supplier development and related innovative approaches become apparent, as supplier development can lead to long term partnerships with suppliers and can cause a reduction of transaction costs.

Integrated water management and environmental justice – public acceptability and fairness in adopting water innovations

Innovations to manage freshwater resources and avert shortages – including conservation through use of reclaimed wastewater, desalination, and demand-side management measures such as increasing block rate structures offer practical, effective remedies for meeting future water demands. We examine the challenges confronting adoption of these innovations that revolve around perceptions of fairness and public acceptability. A major obstacle to these approaches' adoption is environmental justice – that the risk and burden of resource solutions, as well as their benefits – should be borne equitably, despite differences of income or race. We first consider how debates regarding water supply are often disputes over different notions of environmental justice. We then examine general equity debates over adopting various innovations in one US state at the nexus of water demand and supply innovation: California. We contend that fairly adopting these innovations requires embracing open, inclusive, and transparent decision-making processes in which no important constituency is excluded from decisions, and in which different notions of environmental justice are embraced.

BENEFITING FROM SUPPLIER OPERATIONAL INNOVATIVENESS: THE INFLUENCE OF SUPPLIER EVALUATIONS AND ABSORPTIVE CAPACITY

As suppliers take on more important roles in manufacturing and designing products, their operational innovativeness becomes an important source of value. We use the relational view theory to hypothesize for a positive association between operational innovativeness of established suppliers and manufacturer performance. Furthermore, we posit that the manufacturer can enhance this value by ensuring that the supplier is performing as expected (i.e., through supplier evaluation programs), and by focusing on learning from the supplier (i.e., through absorptive capacity). We then develop hypotheses as to how the influence of these two approaches differs when working with suppliers assigned to different types of tasks. We test the hypotheses using survey responses from 136 manufacturers evaluating 272 of their suppliers. Results show that supplier evaluation programs and absorptive capacity are both effective means of augmenting the benefits of supplier operational innovativeness. Contrary to theoretical predictions, benefits of operational innovativeness of suppliers with knowledge-intensive tasks are enhanced through increased absorptive capacity and through increased supplier evaluation programs.

System innovation through stepwise reconfiguration: the case of technological transitions in Dutch greenhouse horticulture (1930–1980)

Although transitions are usually perceived as technological substitution processes, the article shows that stepwise reconfiguration is more likely for supplier-dominated sectors. In this transition pattern, novelties are initially adopted as ‘modular innovation’ into existing systems and subsequently reconfigure the basic architecture through new combinations of old and new elements. Incumbent actors survive these transitions through interactions with suppliers of knowledge and innovations. Using Pavitt's innovation typology, we selected a case study from his supplier-dominated category: greenhouse farming. The article makes a techno-economic analysis of the overall transition pattern in Dutch greenhouse horticulture (1930–1980) and a socio-institutional analysis of the knowledge flows and networks. ‘Innovation cascades’ are identified as a particularly important mechanism in reconfiguration transitions.

SUPPLIER INNOVATIVENESS AND SUPPLIER PRICING: THE ROLE OF PREFERRED CUSTOMER STATUS

In this article, we study the antecedents of supplier innovativeness and supplier pricing. Based on an extensive literature review, we identify different types of antecedents: (1) 'technical' antecedents, which include the capabilities of suppliers to innovate (such as their level of R&D investment) and (2) 'behavioural' antecedents, which focus on the position of the buyer as a supplier's preferred customer. We hypothesise that the two antecedents influence supplier innovativeness in a positive way. Furthermore, we analyse supplier pricing behaviour. We assume that suppliers' awareness of their capabilities to innovate might provoke them to charge unfair prices, while preferred customer status may reverse this tendency and lead to more benevolent supplier pricing behaviour. We test the conceptual framework using a sample of 166 buyer-supplier relations. We find out that technical and behavioural antecedents can explain supplier innovativeness to a large extent, with the role of preferred customer status striking out. Remarkably, whereas we expected that suppliers who are involved in innovation would be found to charge higher prices for their contributions to newly developed products, our results show that this effect is not statistically significant. The missing link between supplier pricing and supplier innovativeness can encourage firms to engage in collaborative innovation, at all, because buyers do not need to fear being overcharged. Implementing a preferred customer policy can improve the conditions for innovating with suppliers.

SUPPLIER INVOLVEMENT IN CUSTOMER NEW PRODUCT DEVELOPMENT: NEW INSIGHTS FROM THE SUPPLIER'S PERSPECTIVE

This paper presents the results from an empirical survey of chemical suppliers, which examines the influence of customer relationship functions on supplier involvement in customer new product development (NPD) from the supplier's perspective. Using multiple regression analysis, we can demonstrate a positive influence between the direct functions (e.g., profit, volume) of customer relationship and supplier involvement in customer NPD. Differentiating between innovative and non-innovative suppliers leads to distinctive differences. While the direct functions are a strong predictor for the supplier involvement in the non-innovative supplier group, in the innovative group only indirect functions (innovation, market, scout and access functions) influence the supplier involvement. These results show that mutual support in the NPD and open network are the imperative triggers for the involvement of innovative suppliers. The obtained results provide theoretical as well as practical implications for the supplier involvement in customer NPD.

Editorial: SPECIAL ISSUE ON OPEN INNOVATION AND THE INTEGRATION OF SUPPLIERS — PART TWO

International Journal of Innovation ManagementVol. 15, No. 01, pp. v-vii (2011) No AccessEditorial: SPECIAL ISSUE ON OPEN INNOVATION AND THE INTEGRATION OF SUPPLIERS — PART TWOALEXANDER BREMALEXANDER BREM Search for more papers by this author https://doi.org/10.1142/S1363919611003234Cited by:2 Next AboutSectionsPDF/EPUB ToolsAdd to favoritesDownload CitationsTrack CitationsRecommend to Library ShareShare onFacebookTwitterLinked InRedditEmail Remember to check out the Most Cited Articles! Be inspired by these New Titles in Business and Management FiguresReferencesRelatedDetailsCited By 2Collaboration for R&D Projects between the Industry and External Agents: Evidence from Manufacturing Companies in PeruJuan Jesus Arenas and Domingo Gonzalez25 March 2019 | Latin American Business Review, Vol. 20, No. 1Recommendations for supplier innovation evaluation from literature and practiceStefan Winter and Rainer Lasch6 Jun 2016 | International Journal of Operations & Production Management, Vol. 36, No. 6 Recommended Vol. 15, No. 01 Metrics History PDF download

RIGIDITIES CONSIDERED: SUPPLIER STRATEGIES FOR INTEGRATED INNOVATION

Innovation is a strategic issue in need of internal and external alignment. This is particularly the case for supplier innovations, as new product concepts and strategies must cope with supply chain interfaces. Suppliers' strategies are oftentimes confronted by innovation rigidities resulting from a manufacturers' need to manage the integration of several components from various suppliers into a coherent innovation. Suppliers can follow different innovation strategies derived from a deliberate planning or a emerging as suppliers incrementally learn and experiment along their path. A survey of 241 suppliers illustrates that these two strategic types effect on market success depends on the level of the rigidities. The survey results also illustrate that two dynamic capabilities, the planning capability and the innovation orientation, act as intermediary variables to increase success under specific rigidity conditions. The findings further illustrate that dynamic capabilities can be enhanced by an adequate strategy.

Exploring supply chain innovation

Supply chain management promises competitive advantages for industrial organizations. The introduction of new products and services, or entry into new markets, is likely to be more successful if accompanied by innovative supply chain designs, innovative supply chain management practices, and enabling technology. This is a widely accepted premise in business practice today. However, systematic research and knowledge about supply chain innovation (SCI) is little developed. There is a lack of common terminology, of agreement about the conceptual understanding, and of related empirical work. This paper presents an exploratory study that aims to provide a better understanding of SCI, mirroring leading edge practice, and providing a sound terminological and conceptual basis for advanced academic work in the field. The research is based on an in-depth literature review and the analysis of a set of secondary data sources: 36 SCI cases, drawn from applications for the Council of Supply Chain Management Professionals’ (CSCMP) Supply Chain Innovation Award. As results of the research, a new SCI definition, the construction of a descriptive model of its key elements, and discussion of implications are presented.

Assessing innovative national policy options and roles for CCS in a post-kyoto framework

Abstract The highly contentious, complex negotiations over the past several years to establish a globally more-inclusive, post-Kyoto Framework illustrate the daunting complexity and diversity of interests, which had to be accommodated. Notwithstanding the many challenges, a “Copenhagen Accord” was reached at the December 2009 15th Conference of Parties (COP 15) of the United Nations Framework Convention on Climate Change (UNFCCC) held in Copenhagen, Denmark. That Accord provided the basis for subsequent delineation of the post-Kyoto Framework in 2010 at the meetings in Mexico City, Mexico. Adoption of more flexibility in the approaches nations can employ to achieve significant, verifiable emissions reductions is among the many critical and necessary accommodations made to achieve more inclusive participation from developing economies and other large economies that did not adhere to the Kyoto Protocol. Negotiations also had to address trade and national sovereignty issues as well. This flexibility is an essential recognition of national and cultural differences including differences in levels of national and sub-national economic wealth and growth, status of energy infrastructure development, and national energy resource endowments. This paper presents research findings from a project using a step-by-step methodology. The first step was defining a set of generic, guiding principles for economically efficient and effective national emissions reduction programs. These were employed to design a comprehensive portfolio of innovative national policy and technology strategies that could be adopted by large, developed economies as well as some large developing economies. A specific example is presented using the United States as the test case. The cost-effectiveness of the innovative policy and technology portfolio is assessed for the test case based on a number of effectiveness measures, including: projected economic impacts and emissions reductions, national security impacts, energy-related impacts on water use and other environmental aspects, and regional economic equity. The assessment methodology employs a Reference Case Scenario (RCS), based on the Annual Energy Outlook 2010 energy projections (AEO 2010) of the U.S. Energy Information Agency (EIA), extended through 2050. The EIA energy projections are a widely used basis for projecting future energy demand, supply, and prices in the United States. They provide a comprehensive economy-wide reference data set. Particular attention is given to the electric generation, transportation, and industrial sectors, which account for the majority of energy production, demand, and emissions. A Policy and Technology Innovations Scenario (PTIS) is constructed covering all sectors of the energy economy with special attention as described above. The case specifications include new Federal and State legislative innovations and modifications to existing laws, regulatory reforms and innovations, and enhanced low-carbon technology innovation programs. Based on the PTIS case specifications, the incremental energy, economic, emissions, and other impacts from successful adoption and implementation of the PTIS case are projected as changes to the Reference Case Scenario using transparent techno-economic modeling approaches. The enhanced, low-carbon energy technology innovations programs included in the PTIS case cover a broad spectrum of energy supply and demand innovations. Particular attention is given to innovations that increase energy efficiency in both production and uses of energy in all economic sectors. Recognizing the extremely large energy infrastructure and imbedded capital investments already existing in the United States, special attention is given to innovations to transform and expand that infrastructure to meet future clean energy needs. The latter is a key strategy for making the transition affordable. One focus of attention is innovative opportunities for Carbon Capture and Sequestration (CCS). These are described along with the policy, regulatory, and technology improvements necessary to enable those contributions. The quantitative and qualitative differences between the two Scenarios are compared using the effectiveness measures adopted. These comparisons confirm that a portfolio such as that modeled in this project can lead to significant, affordable emissions reductions in the near term, and establish a pathway to a future energy economy with much larger reductions in energy use and emissions than the Reference Case in the longer term. Other key insights and conclusions from the assessment are described. The national and sub-national political, economic, and regulatory barrier and constraint challenges to successful implementation of a PTIS case are presented along with options for overcoming those challenges.

Nicolaus Copernicus: not only a great astronomer but also a physician

Nicolaus Copernicus (1473-1543), an internationally recognized Polish astronomer, studied liberal arts at the Jagiellonian University in Cracow during the period 1491-1495. Shortly thereafter he was sent by his uncle to Bologna University, where he spent almost 5 years (1496-1501) studying law and philosophy. After his return to Poland, Nicolaus was nominated as canon in the cathedral chapter in Frombork. Next he started to study medicine in the University of Padua, one of the best-known centers of medical education in Europe. He was granted a bachelor degree and after another year, a therapeutic license (veniam practicandi), but never obtained his doctoral degree from Padua, though he was always called doctor of medicine ("medici doctor"). Copernicus returned to Warmia in 1503 and spent almost 40 years there. During the first few years he was the personal "medicus" and secretary of his uncle, Bishop Lucas Watzenrode. After the death of his uncle in 1512, Copernicus became the personal physician to the subsequent 4 Warmian bishops and his confreres from the Warmian chapter in Frombork. Copernicus practiced medicine not only in diagnosing and taking care of his patients but also in personally preparing the prescribed drugs. He was often consulted (consiglia) from several other cities, including Gdańsk, Königsberg, Lubawa, Elblag and Olsztyn. He also collaborated and consulted with Jan Benedict Solfa and Laurence Wille, the official Polish royal physicians at the time. During the epidemics of 1519, Copernicus employed sanitary preventive measures by providing several Warmian and Pomeranian towns with an innovative water supply system. Copernicus is well known as a genius in astronomy, but this great Renaissance man was also a mathematician, engineer, soldier, writer, economist and, last but not least, a practicing physician.

The application of science and technology development in shaping current and future aquaculture production systems

SUMMARYAquaculture development over the past 50 years has been facilitated largely by the application of science and the introduction of new technologies. Although aquaculture is a very diverse sector in products, production systems and business structures, almost every activity has benefited from scientific advances. However, the impact of technological progress is most clearly seen where there has also been substantial industrial consolidation. This has provided greater capital resources for investment and a more attractive market for suppliers of innovations to target. It has also encouraged consolidation of research capacity and stronger articulation between private and publicly funded research efforts. Further development along current trajectories is possible through advances in genomics, information technology, materials science and other areas. However, there may also be substantial disruptions if, for instance, energy becomes much more expensive, or large mono-cultures are impacted by climate change. Substantial change could also be driven by policies that aim at bringing realistic external costs of environmental services into company accounts. Research into more resilient aquaculture systems that comply more with ecological than financial accounting principles is under way, but will require substantial development to meet the challenges of rising food needs and social aspirations.