Nurturing the Accumulation of Innovations: Lessons from the Internet

The innovations that became the foundation for the Internet originate from two eras that illustrate two distinct models for accumulating innovations over the long haul. The pre-commercial era illustrates the operation of several useful non-market institutional arrangements. It also illustrates a potential drawback to government sponsorship – in this instance, truncation of exploratory activity. The commercial era illustrates a rather different set of lessons. It highlights the extraordinary power of market-oriented and widely distributed investment and adoption, which illustrates the power of market experimentation to foster innovative activity. It also illustrates a few of the conditions necessary to unleash value creation from such accumulated lessons, such as standards development and competition, and nurturing legal and regulatory policies.

Human Resource and Employment Practices in Telecommunications Services, 1980-1998

[Excerpt] In the academic literature on manufacturing, much research and debate have focused on whether firms are adopting some form of “high-performance” or “high-involvement” work organization based on such practices as employee participation, teams, and increased discretion, skills, and training for frontline workers (Ichniowski et al., 1996; Kochan and Osterman, 1994; MacDuffie, 1995). Whereas many firms in the telecommunications industry flirted with these ideas in the 1980s, they did not prove to be a lasting source of inspiration for the redesign of work and employment practices. Rather, work restructuring in telecommunications services has been driven by the ability of firms to leverage network and information technologies to reduce labor costs and create customer segmentation strategies. “Good jobs” versus “bad jobs,” or higher versus lower wage jobs, do not vary according to whether firms adopt a high- involvement model. They vary along two other dimensions: (1) within firms and occupations, by the value-added of the customer segment that an employee group serves; and (2) across firms, by union and nonunion status. We believe that this customer segmentation strategy is becoming a more general model for employment practices in large-scale service | operations; telecommunications services firms may be somewhat more | advanced than other service firms in adopting this strategy because of certain unique industry characteristics. The scale economies of network technology are such that once a company builds the network infrastructure to a customer’s specifications, the cost of additional services is essentially zero. As a result, and notwithstanding technological uncertainty, all of the industry’s major players are attempting to take advantage of system economies inherent in the nature of the product market and technology to provide customized packages of multimedia products to identified market segments. They have organized into market-driven business units providing differentiated services to large businesses and institutions, small businesses, and residential customers. They have used information technologies and process reengineering to customize specific services to different segments according to customer needs and ability to pay. Variation in work and employment practices, or labor market segmentation, follows product market segmentation. As a result, much of the variation in employment practices in this industry is within firms and within occupations according to market segment rather than across firms. In addition, despite market deregulation beginning in 1984 and opportunities for new entrants, a tightly led oligopoly structure is replacing the regulated Bell System monopoly. Former Bell System companies, the giants of the regulated period, continue to dominate market share in the post-1984 period. Older players and new entrants alike are merging and consolidating in order to have access to multimedia markets. What is striking in this industry, therefore, is the relative lack of variation in management and employment practices across firms after more than a decade of experience with deregulation. We attribute this lack of variation to three major sources. (1) Technological advances and network economics provide incentives for mergers, organizational consolidation, and, as indicated above, similar business strategies. (2) The former Bell System companies have deep institutional ties, and they continue to benchmark against and imitate each other so that ideas about restructuring have diffused quickly among them. (3) Despite overall deunionization in the industry, they continue to have high unionization rates; de facto pattern bargaining within the Bell system has remained quite strong. Therefore, similar employment practices based on inherited collective bargaining agreements continue to exist across former Bell System firms

Examination of Regional Transit Service Under Contracting: A Case Study in the Greater New Orleans Region, Research Report 10-09

Many local governments and transit agencies in the United States face financial difficulties in providing adequate public transit service in individual systems, and in providing sufficient regional coordination to accommodate transit trips involving at least one transfer between systems. These difficulties can be attributed to the recent economic downturn, continuing withdrawal of the state and federal funds that help support local transit service, a decline in local funding for transit service in inner cities due to ongoing suburbanization, and a distribution of resources that responds to geographic equity without addressing service needs. This study examines two main research questions: (1) the effect of a “delegated management” contract on efficiency and effectiveness within a single transit system, and (2) the effects of a single private firm—contracted separately by more than one agency in the same region—on regional coordination, exploring the case in Greater New Orleans. The current situation in New Orleans exhibits two unique transit service conditions. First, New Orleans Regional Transit Authority (RTA) executed a “delegated management” contract with a multinational private firm, outsourcing more functions (e.g., management, planning, funding) to the contractor than has been typical in the U.S. Second, as the same contractor has also been contracted by another transit agency in an adjacent jurisdiction—Jefferson Transit (JeT), this firm may potentially have economic incentives to improve regional coordination, in order to increase the productivity and effectiveness of its own transit service provision. Although the limited amount of available operation and financial data has prevented us from drawing more definitive conclusions, the findings of this multifaceted study should provide valuable information on a transit service contracting approach new to the U.S.: delegated management. This study also identified a coherent set of indices with which to evaluate the regional coordination of transit service, the present status of coordination among U.S. transit agencies, and barriers that need to be resolved for regional transit coordination to be successful

Trust in ICT-Based New Product Development - Guidelines for Virtual New Product Development Teams

The traditional process of new product development is focusing on an intra-organizational workflow, which should - in its ideal form - be done by virtual interdisciplinary teams. Team members should be from several departments like manufacturing, research & development, sales and marketing. But innovation is happening more and more in networks of companies, clusters or so called network companies. The following article delivers a framework of guidelines for virtual team management in order to improve the success of innovation strategies.e-collaboration, virtual team work, new product development, Research and Development/Tech Change/Emerging Technologies,

Overcoming inaction through collective institutional entrepreneurship

Studies on institutional change generally pertain to the agency-structure paradox or the ability of institutional entrepreneurs to spearhead change despite constraints. In many complex fields, however, change also needs cooperation from numerous dispersed actors. This presents the additional paradox of ensuring that these actors engage in collective action when individual interests favor lack of cooperation. We draw on complementary insights from institutional and regime theories to identify drivers of collective institutional entrepreneurship and develop an analytical framework. This is applied to the field of global climate policy to illustrate how collective inaction was overcome to realize a global regulatory institution, the Kyoto Protocol

International Growth as Integration of R&D Activities. Evidence from Large Multinational Companies

Corporate R&D internationalization has been analyzed predominantly in terms of the geographic diversification of multinational companies' research laboratories, and only to a lesser extent as a process involving the development of resources and capabilities within organizations and as a means of favoring international integration. This paper analyzes the relation between these two dimensions of internationalization, both of which are relevant for study of the multinational growth of R&D activities. Examination of the literature together with in-depth case reports of two large multinational clusters provides evidence in support of the following statements: · R&D internationalization can be seen as a "gradual" process that takes shape through the formation of specific resources and capabilities, which are developed within individual organizations but are designed to achieve integration both with foreign organizational units of the multinational cluster itself and also with other national innovation systems; · Multinational R&D follows a strategy that is characterized by a strong inter-relation between the formation of foreign research activities and the character of the integration process; · Corporate strategies may correspond to highly diverse and at times even contrasting R&D internationalization models, as shown by the emblematic case analyses presented here. The presence of these different models limits the scope of any general interpretation of the determinants and implications of R&D internationalization.-