Supplier Involvement In Product Development Research Articles

The ambiguous impact of supplier involvement in product development on supplier relationship resilience and company performance

PurposeI aimed to obtain a deeper insight into the link between supplier involvement in product development (SIPD), supplier relationship resilience and company performance.Design/methodology/approachTo collect data, a survey among 500 Polish manufacturing companies was conducted. I used quantitative methods (structural equation modeling) to test several research hypotheses referring to a single supplier–customer relationship. Thanks to the use of multi-construct measurement of SIPD and supplier relationship resilience, the study provides detailed research results on the topic.FindingsCollaborative practices implemented during SIPD increase procurement flexibility and decrease redundancy in the relationship with the involved supplier. Communication during SIPD increases supplier flexibility and procurement flexibility. Increased supplier flexibility and increased procurement flexibility in the relationship with the involved supplier as well as collaborative practices during SIPD positively impact company performance. I confirmed the indirect effect between communication during SIPD and company performance when the mediators are supplier flexibility and procurement flexibility. Decreased redundancy in relationship with involved supplier does not impact company performance.Practical implicationsSupply chain managers need to rethink SIPD practice to effectively ensure supply chain resilience (SCRES), especially in the face of the contemporary global crisis and black swans affecting the supplier base. My article provides important managerial insights into drivers of SCRES and company performance.Originality/valueTo the best of my knowledge, this research is among the first to conclude that SIPD does not have an unequivocally positive or direct impact on supplier relationship resilience. The research fills the gap by analyzing the impact of SIPD on two main SCRES elements. The study examines supplier relationship resilience, understood as flexibility and redundancy elements, in a single supplier–buyer relationship perspective. Thus, the presented considerations go beyond the traditional understanding of flexibility and redundancy in supplier relationship management, that is through the prism of double or multi sourcing and having back up-suppliers.

The effects of the fuzzy front end and cross-functional interfaces in the NPD process

PurposeAs the start of a new product development (NPD) process, the front fuzzy end (FFE) is believed to determine new product performance to a large extent. However, its effects on new product performance, particularly in terms of quality and cost, lack empirical evidence in the extant literature. Moreover, the joint performance effects of the FFE and cross-functional interfaces in later NPD stages (i.e. product development and product launch) are largely overlooked and deserve further investigation. Therefore, this study aims to explore the direct effects of the FFE and later stages’ joint moderating effects on new product performance (i.e. quality and cost) from a holistic process view.Design/methodology/approachA conceptual model is proposed to hypothesize the FFE–new product performance relationships and the joint performance effects of cross-functional interface management. A sample of 196 firms from an international survey is used and hierarchical linear regression is employed to test the proposed hypotheses.FindingsThis study finds that FFE implementation contributes to both new product quality and cost performance. Moreover, interface management in multiple NPD stages has synergistic performance effects. Specifically, the FFE, customer involvement in product development and manufacturing flexibility in product launch jointly improve new product quality performance, while the FFE, supplier involvement in product development and manufacturing flexibility in product launch jointly improve new product cost performance.Originality/valueThis study extends the NPD literature by deepening the understanding of the key roles of the FFE on new product performance and evidencing the synergistic effects of cross-functional interfaces in multiple NPD stages. Further, this study also highlights the differential joint moderating effects of interface management in later NPD stages on new product quality and cost performance. This study also offers insightful implications to NPD managers.

Supplier involvement in product development: Challenges and mitigating mechanisms from a supplier perspective

This article explores challenges that suppliers experience when being involved in customers’ product development projects, and how these challenges can be mitigated. It presents a framework of supplier involvement in product development involving four dimensions: People-Process-Tools/Technology-Interaction. The framework consists of 24 challenges and associated mitigating mechanisms. The article concludes that suppliers must be aware of the challenges to ensure that proper internal capabilities are in place within their organizations. It also argues that customers should be aware of the challenges to provide best possible prerequisites for suppliers to ensure successful project outcomes.

The Impact of Supplier Involvement in Product Development on Supply Chain Risks and Supply Chain Resilience

The Impact of Supplier Involvement in Product Development on Supply Chain Risks and Supply Chain Resilience

Challenges with Supplier Involvement in Product Development: A Supplier’s Perspective

AbstractStudies of supplier involvement in product development have revealed potential benefits including faster time to market, reduced cost and increased quality. However, existing literature has mainly focused on the customer's perspective on advantages, disadvantages and factors to be considered when involving suppliers in product development. This paper addresses the supplier's perspective by answering following research question: How do challenges that originate from involvement in customer's product development affect a supplier? The question is answered through a single case study at a supplier that develops and manufacture products primary used in capital goods. Thirteen challenges are identified, classified as being internal or external, and categorised into five areas: (A) Customer requirements, (B) Information exchange between customer and supplier, (C) Product variety management, (D) Design- manufacturing integration and (E) Processes and work instructions. The findings suggest that internal challenges need as much attention as external ones that originate from the customer. Also, an indication of when the challenges affect the supplier during product development is presented.

The role of supplier relationships in the development of new business ventures

New business ventures have rather limited resources, generally suffer from liabilities of smallness and newness and rely on external business relationships, typically with suppliers, for developing and acquiring necessary resources. Yet, to date, research on how new ventures develop initial relationships with suppliers and how these affect the nascent business has been limited. Taking the business network perspective and relating it to studies of supply chain and supplier involvement in product development, our study contributes to the rather limited body of knowledge on new ventures' supplier relationships. Empirically, we draw on a longitudinal, in-depth single-case study of the first two years of operation of a start-up. Our study shows that the development of the key initial supplier relationships starts from open-ended expectations of mutual future relational benefits and involves a stepwise ‘inter-definition’ of solutions in interaction between the parties. We observe that interdependences arise between the new venture and its key suppliers and these enable but also limit, the development paths of both partners. We argue that the key initial supplier relationships extend a new venture's resource and capability base and are an integral part of a new venture's business model.

In pursuit of control: involving suppliers of critical technologies in new product development

Purpose– The purpose of this paper is to explore the dynamics of management and control in collaborations with suppliers of critical technology.Design/methodology/approach– Three collaborative product development projects at a system integrator in the telecom industry were studied. The data was collected through 22 semi-structured interviews and a workshop at the studied company and its suppliers.Findings– The paper shows that in situations of high dependence on suppliers of critical technologies, control may be pursued by complementing black-box development with appropriate checks and balances in the collaboration, i.e. using combinations of control mechanisms, disconnected development and joint problem solving, contracts and trust, and alignment efforts on project and strategic levels. Further, the paper demonstrates that this involves several trade-offs related to the advantages of increased monitoring and disadvantages of decreased levels of freedom for the supplier and consequently decreased prerequisites for supplier creativity.Research limitations/implications– The qualitative approach of the research limits generalizability. Our study is limited to three projects at one firm.Practical implications– Technological roadmaps can be used as an important tool to facilitate alignment with suppliers of critical technologies. Limited influence on project level can be supported by influencing the supplier on a strategic level. By collaborating on a strategic level, firms can gain alignment for future projects and diminish the need for direct project control within the projects. Long-term collaborations facilitate control in projects with powerful suppliers of critical technologies.Originality/value– While many studies suggest simplified responses to complex situations of supplier involvement in product development, this study provides insight into the complex responses to control suppliers of critical technologies.

Supply network delegation and intervention strategies during supplier involvement in new product development

PurposeThis paper proposes and empirically investigates two strategies that companies can employ to involve indirect suppliers in new product development (NPD): supply network delegation; and supply network intervention. The implications of the two strategies are explored.Design/methodology/approachThe paper brings together the traditional NPD literature, organizational behaviour and organizational economics literature, and reports on three in‐depth case studies of NPD projects, involving 39 semi‐structured interviews across three supply networks.FindingsThe findings reveal different manifestations of the two strategies of supply network intervention and delegation, when applied as part of supplier involvement in product development, and positive and negative indications of delegation and intervention, depending on the actor perspective: manufacturers perceive a need to control the product development process across several supply network tiers through intervention in supplier selection and communication, but these actions are likely to “tie the hands of the suppliers”.Practical implicationsManagers are advised to explicitly delegate decisions to suppliers, for example, by issuing parts approval lists and encouraging communication and problem solving amongst suppliers, and to exercise caution in applying the intervention strategy.Originality/valueThe paper contributes to a better understanding of how to involve indirect (sub‐) suppliers in product development, and the implications of these actions for multiple supply network actors.

Fuzzy adaptive resonance theory approach to supplier involvement in product development: a case study in Turkish automobile industry

This study proposes a mechanism to evaluate suppliers for involvement during product development process. The proposed methodology is discussed within a multinational automobile firm and preliminary analysis indicates that the approach provides an effective mechanism for selecting suppliers involved in the product development process. To remedy to supplier integration problems, a clustering approach – fuzzy adaptive resonance theory (Fuzzy ART) – is used. The proposed methodology is explained using a case study that is realised in an automobile firm. Eventually, the results are presented comparatively, which obtained by current supplier evaluation system of the firm and provided from Fuzzy ART methodology. [Submitted 14 July 2009; Revised 16 November 2009; Accepted 17 November 2009]

A typology of coordination strategy in multi‐organizational product development

PurposeThe purpose of this paper is to explore a manufacturer's strategy to coordinate efforts of multiple suppliers' involvement in the product development process. The paper also proposes critical factors in determining the appropriate coordination strategy.Design/methodology/approachBased on the synthesis of the literature and relevant theories, a typology of coordination strategies is developed. Propositions are developed pertaining to the performance implications of the coordination strategies and the key determinants of the effectiveness of the coordination strategies.FindingsFour ideal types of coordination strategies are: centralized‐programming, centralized‐feedback, decentralized‐programming, and decentralized‐feedback. Prior research and recently reported industry examples indicate that a manufacturer's coordination with multiple suppliers varies in terms of the information‐processing structure and thelocusof control. The effectiveness of a manufacturer's coordination strategies is influenced by the extent of component modularity, product complexity, technology uncertainty, and the technical capability of suppliers.Practical implicationsThe four coordination strategies involve trade‐offs on certain performance dimensions. Decentralized‐programming promotes process efficiency, while centralized‐feedback facilitates problem solving. Centralized‐programming favors integrative product design, while decentralized‐feedback favors innovation from supplier's technical expertise.Originality/valueWhile research on supplier involvement in product development has primarily focused on a single supplier's integration in the process, this paper extends understanding of multi‐organizational coordination by applying information‐processing decision‐making theories to the product development context.

Supplier dependence: impact on supplier's participation and performance

PurposeThe purpose of this paper is to extend our understanding of the importance of supplier dependence on the buyer's firm and its relationship to supplier training and supplier involvement in product development with respect to the supplier's performance.Design/methodology/approachA random sample of 231 firms provided the data that were analyzed for this study. Using structural equation modeling, a sub‐set of the sample consisting of 166 manufacturing firms was used to test the five hypothesized relationships in the model.FindingsThe main findings indicate that supplier dependence is a significant contributor to increasing supplier participation in buyer supported training and increasing supplier involvement in product development. Also, supplier training and supplier involvement are significant contributors to the supplier's operational performance.Research limitations/implicationsThe model tested in this study used a random sample of US manufacturing firms. Thus, future studies should include a random sample of non‐manufacturing firms and firms outside of the USA. The study explored the buyer's perspective only; a study of suppliers may provide further insights to extend this study. Although the use of supplier training was relatively low, significant relationships were identified.Practical implicationsBased on this research, key suppliers can better understand the relationships among supplier dependence, supplier training, supplier involvement in product development and their effects on supplier's operational performance.Originality/valueAlthough supplier development has emerged in previously published studies as a critical factor in improving performance, the role of supplier dependence on the buyer has not been empirically examined. Further, an integrated research model that investigates the relationships among supplier dependence, supplier training, supplier involvement in product development and supplier's operational performance has not been offered.

Strategic and Operational Management of Supplier Involvement in New Product Development: A Contingency Perspective

This paper examines how firms succeed to leverage supplier involvement in product development. The paper extends earlier work on managing supplier involvement by providing an integrated analysis of results, processes, and conditions at the level of both the individual development projects and the overall firm. Following a multiple-case study approach with theoretical sampling, the study is carried out by examining eight projects in which four manufacturers from different industries involve multiple suppliers. The findings suggest that successful supplier involvement is dependent on the coordinated design, execution, and evaluation of strategic long-term processes and operational short-term management processes and the presence of enabling factors such as a cross-functional oriented organization. The required intensity of these processes and enablers depends on contingencies such as firm size and environmental uncertainty. In contrast with previous research, we find no indications that managing supplier involvement requires a different approach in highly innovative projects compared to less-innovative projects.

Supplier evaluation and management system for strategic sourcing based on a new multicriteria sorting procedure

Supplier selection and evaluation is increasingly seen as a strategic issue for companies. Unlike the past, an emerging trend is to select suppliers where a long-term relationship is desired and supplier involvement in product development is required and to sort suppliers into categories based on performances. This paper describes a supplier evaluation and management methodology for strategic sourcing, in which suppliers are assessed considering supplier's co-design capabilities and categorized based on overall performances, potential reasons for differences in performance of supplier groups are identified, and performances of the suppliers are improved by applying supplier development programs. A new multicriteria sorting method based on the PROMETHEE methodology is also introduced. By means of a strategic supplier selection example, we demonstrate that our methodology is a flexible and responsive decision-making tool for assessing strategic suppliers.

Supplier involvement in product development in the electronics industry: A case study

The movement of activities earlier in the product development process requires a re-examination of the total supply network. The objective of this paper is to determine the degree of early supplier involvement (ESI) that exists between a multinational electronics company and its key suppliers, in terms of depth of integration, information exchange and buyer–supplier relationships. The paper provides insights into the strategic factors that affect the dynamics of the ESI process. The research indicates that there are considerable impediments for those participants responsible for establishing and managing the implementation of ESI. A number of strategic insights are identified that explain the existence of the impediments to the ESI process. Finally, based upon the findings a number of lessons are highlighted for organisations considering the adoption of the ESI process.

Coordinating supplier involvement in product development projects: a differentiated coordination typology

Supplier involvement in product development has been a widely discussed theme in recent years. Sometimes, one ‘best method’ for involvement, derived from studies of one particular industrial context, has been suggested. In this article, however, various forms for coordinating such involvement are distinguished, based on a study of six different product development projects. Three main approaches are formulated and discussed: project integration coordination, disconnected sub‐project coordination, and ad hoc coordination. Based on the empirical study and the literature, the drivers of different types of supplier coordination are discussed. Several managerial implications are suggested related to the need to differentiate inter‐organizational coordination, not only from project to project but also throughout a project. The importance of taking into account short‐term, project‐based drivers as well as long‐term strategic objectives of supplier coordination is also discussed.

Supplier involvement in new product development in the food industry

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.

Factors influencing co‐design adoption: drivers and internal consistency

As customers ask for increasing levels of performance, functionality and customisation, firms rely on suppliers not only as a source of components, but also as a source of innovation. Several researchers have investigated the adoption of co‐design, its potential benefits and its costs. Recently, scholars have increasingly underlined the need for bringing this rich stream of studies within a contingency framework, taking into account context variables and internal characteristics of the firm. This paper contributes to this contingency theory of co‐design adoption. We investigate the role of three factors that might influence the intensity of supplier involvement in product development: structural characteristics (industry, size and degree of vertical integration), strategic priorities (strategic fit) and internal consistency with purchasing and new product development practices. An empirical analysis of 67 Italian manufacturers demonstrates that co‐design adoption is actually related to most of these factors.

Sourcing trends in the car industry

Intense competition and structural changes characterize the car industry. Several trends (i.e. general changes over time) concerning sourcing strategies and supplier relations can therefore be identified. The article aims to analyze how these trends correspond to the actual situation in the car industry. Based on a survey answered by both car manufacturers and first tier suppliers, this article provides facts and analyses regarding sourcing‐related trends over the past decade as well as some future predictions. The results show that both car manufacturers and suppliers continue to reduce product development time. They also increase supplier involvement in product development and the share of inbound JIT‐deliveries. However, while suppliers increase their outsourcing and globalization of production and product development activities, car manufacturers do not. Only some of the identified sourcing‐related trends are actually supported by the presented results. Hence, this article modulates the picture of the current development within the car industry.

Knowledge Partitioning in the Interfirm Division of Labor: The Case of Automotive Product Development

Drawing on an empirical study on automakers' management of supplier involvement in product development in Japan, this paper shows that when the design of a component is outsourced to a supplier, how much automakers know about the component matters for them to gain a better outcome. While the actual tasks of designing and manufacturing components could be out-sourced, automakers should retain the relevant knowledge to obtain better component design quality. The paper argues that knowledge partitioning should be distinguished from task partitioning, and provides some implications for the knowledge-based theory of the firm.The results indicate that effective pattern of knowledge partitioning differs by the nature of component development project in terms of technological newness. For regular projects, it is more important for the automaker to have a higher level of architectural knowledge (how to coordinate various components for a vehicle) than of component-specific knowledge, which is supposed to be provided by the supplier. However, when the project involves new technology for the supplier, it is important for the automaker to have a higher level of component-specific knowledge to solve unexplored engineering problems together with the supplier. In innovative projects, effective knowledge partitioning seems to demand some overlap between an automaker and a supplier, rather than efficient and clear-cut boundaries that are optimal for regular projects. Such “fluid” nature of knowledge boundaries contingent on the project types poses a challenge for firms seeking both technological leadership and efficiency in established products.Developing and maintaining knowledge about an outsourced component is by no means easy. When the actual design tasks are outsourced, automakers miss substantial opportunities to gain relevant knowledge through learning by doing. Also, obtained knowledge may be diffused among competitors through shared suppliers. Another problem for automakers is that component-specific knowledge is important for only limited cases (innovative projects). Even worse, component-specific knowledge has a trade off relationship with architectural knowledge.Such an inherent dilemma of managing knowledge, however, may provide some automakers with the opportunity to achieve sustainable competitive advantage. Additional analysis shows that one automaker managed both types of knowledge better than others in a manner that deals effectively with the dilemma. Its organizational mechanisms include career development policies, extensive documentation of technological information, internal training programs, and incentive schemes. The difficulty in implementing those mechanisms in a consistent and complementary manner seems to explain why there was a significant variance among automakers in knowledge level, even when the actual tasks were carried out by a shared supplier.

A model of co-design relationships: definitions and contingencies

In the ever more turbulent business environment, firms concentrate on their core capabilities and resort to suppliers as sources of complementary know-how. In other words, they tend to co-design their products. This paper shows that co-design may occur in different forms and that success of supplier involvement in product development mainly depends on the proper choice of the type of relationship according to the contingencies to be dealt with. In particular, by adopting a problem solving perspective and a case study approach, we have identified four different approaches to co-design, depending on the type of knowledge transferred from the supplier to the customer (product knowledge or process knowledge) and the degree of interaction between the partners. In this latter regard, a co-design relationship may occur with a loose interaction (when the customer defines the component specifications and the supplier designs the solution that better fits those specifications) or a tight interaction (when the problem solving process is not split between the partners). The paper shows that the choice between a joint or split co-design approach depends on two context factors: the uncertainty of the design endeavour (i.e., the novelty of the component to be developed and the turbulence of the environment) and the relational capabilities (i.e., the capabilities to manage the information flows occurring between the two patterns).