Manufacturing in the 1990s - productivity, flexibility and innovation

The article outlines the evolution of large multinationals as a result of the appearance of new market demands. Companies having to meet specific market demands, are shown to possess certain characteristics, related to the market demands concerned. The analysis shows that innovativeness will, in all probability, be the new market demand in the 1990s, in addition to the already existing ones of efficiency, quality and flexibility. Descriptions of ideal types illustrate the evolution of companies as they move from the Efficient Firm to the Quality Firm on to the Flexible Firm to, finally, the Innovative Firm. The phase model also includes the symptoms of crisis, when moving from one phase to another. Skipping phases appears to be difficult, if not impossible. The same holds true for moving to the next phase, while the organization has not finished with the preceding phase

Coopetition and innovation. Lessons from worker cooperatives in the Spanish machine tool industry

This is an electronic version of the accepted paper in Journal of Business & Industrial Marketing[EN] Purpose – This paper aims to investigate how the implementation of the inter-cooperation principle among Spanish machine-tool cooperatives helps them to coopete–collaborate with competitors, in their innovation and internationalization processes and achieve collaborative advantages. Design/methodology/approach – The paper uses a multi-case approach based on interviews with 15 CEOs and research and development (R&D) managers, representing 14 Spanish machine tool firms and institutions. Eight of these organizations are worker-cooperatives.. Findings – Worker -cooperatives achieve advantages on innovation and internationalization via inter-cooperation (shared R&D units, joint sales offices, joint after-sale services, knowledge exchange and relocation of key R&D technicians and managers). Several mutual bonds and ties among cooperatives help to overcome the risk of opportunistic behaviour and knowledge leakage associated to coopetition. The obtained results give some clues explaining to what extent and under which conditions coopetitive strategies of cooperatives are transferable to other types of ownership arrangements across sectors. Practical implications – Firms seeking cooperation with competitors in their R&D and internationalization processes can learn from the coopetitive arrangements analyzed in the paper. Social implications – Findings can be valuable for sectoral associations and public bodies trying to promote coopetition and alliances between competitors as a means to benefit from collaborative advantages. Originality/value – Focusing on an “ideal type” of co-operation -cooperative organisationsand having access to primary sources, the paper shows to what extent (and how) strong coopetitive structures and processes foster innovation and internationalization

Network strategies for the new economy

In this paper we argue that the pace and scale of development in the information and communication technology industries (ICT) has had and continues to have major effects on the industry economics and competitive dynamics generally. We maintain that the size of changes in demand and supply conditions is forcing companies to make significant changes in the way they conceive and implement their strategies. We decompose the ICT industries into four levels, technology standards, supply chains, physical platforms, and consumer networks. The nature of these technologies and their cost characteristics coupled with higher degrees of knowledge specialisation is impelling companies to radical revisions of their attitudes towards cooperation and co-evolution with suppliers and customers. Where interdependencies between customers are particularly strong, we anticipate the possibility of winner-takes-all strategies. In these circumstances industry risks become very high and there will be significant consequences for competitive markets

Product innovation when consumers have switching costs

Economists have long recognized that in free markets, incentives to innovate will be diluted unless some factors grant innovators with a temporary monopoly. Patenting is the most cited factor in the economic literature. This survey concentrates on another factor that confers innovators with first-mover advantage over their competitors, namely consumer switching costs, whereby a consumer makes an investment specific to her current seller, that must be duplicated for any new seller. In this survey, we list several components of switching costs that are relevant as regards to firm innovation behaviour. The aim of this classification is twofold. First, consumer switching cost theory has matured to the point that some classification of switching costs for both understanding innovative firm behaviour and building policy-oriented models is necessary. Second, the classification included in this paper addresses the confusion that has been existing so far regarding the distinction between ‘good’ or ‘bad’ switching costs, perceived or paid switching costs, and between switching and search costs. This paper then surveys the existing literature on the effect of switching costs on product innovation by firms and the way they compete for consumers. We also raise several important regulation and competition policy questions, using examples from the real world.Consumer switching costs; Search costs; Product innovation; Competition policy; Economic methodology

Re-reengineering the dream: agility as competitive adaptability

Organizational adaptation and transformative change management in technology-based organizations is explored in the context of collaborative alliances. A Re-reengineering approach is outlined in which a new Competitive Adaptability Five-Influences Analysis approach under conditions of collaborative alliance, is described as an alternative to Porter’s Five-Forces Competitive Rivalry Analysis model. Whilst continuous change in technology and the associated effects of technology shock (Dedola & Neri, 2006; Christiano, Eichenbaum & Vigfusson, 2003) are not new constructs, the reality of the industrial age was and is a continuing reduction in timeline for relevance and lifetime for a specific technology and the related skills and expertise base required for its effective implementation. This, combined with increasing pressures for innovation (Tidd & Bessant, 2013) and at times severe impacts from both local and global economic environments (Hitt, Ireland & Hoskisson, 2011) raises serious challenges for contemporary management teams seeking to strategically position a company and its technology base advantageously, relative to its suppliers, competitors and customers, as well as in predictive readiness for future technological change and opportunistic adaptation. In effect, the life-cycle of a technology has become typically one of disruptive change and rapid adjustment, followed by a plateau as a particular technology or process captures and holds its position against minor challenges, eventually to be displaced by yet another alternative (Bower & Christensen, 1995)

Changing boundaries and structure of a technological system: lessons from UK retail banking

This article investigates the factors that have induced and shaped the process of industry evolution of banking in the United Kingdom and, in particular, the reorganization of the retail payments system. It will look at how the effects of technical progress within a changing regulatory framework have contributed to the flourishing of new consumer services, of increasingly specialized technologies and of new models of business organization. In relation to these issues, the paper develops an interpretative framework based on the rapidly expanding body of literature on technological systems. In so doing it argues also that the organization of the payment system has evolved towards a multilayered and increasingly heterogeneous industry in which competition has been fuelled at different levels by the growing diversity of the ecology of agents involved, as well as by the emerging patterns of interaction across them.

Changing boundaries and structure of a technological system: lessons from UK retail banking

This article investigates the factors that have induced and shaped the process of industry evolution of banking in the United Kingdom and, in particular, the reorganization of the retail payments system. It will look at how the effects of technical progress within a changing regulatory framework have contributed to the flourishing of new consumer services, of increasingly specialized technologies and of new models of business organization. In relation to these issues, the paper develops an interpretative framework based on the rapidly expanding body of literature on technological systems. In so doing it argues also that the organization of the payment system has evolved towards a multilayered and increasingly heterogeneous industry in which competition has been fuelled at different levels by the growing diversity of the ecology of agents involved, as well as by the emerging patterns of interaction across them.

Exploration and exploitation in the presence of network externalities

This paper examines the conditions under which exploration of a new, incompatible technologyis conducive to firm growth in the presence of network externalities. In particular, this studyis motivated bythe divergent evolutions of the PC and the workstation markets in response to a new technology: reduced instruction set computing (RISC). In the PC market, Intel has developed new microprocessors bymaintaining compatibilitywith the established architecture, whereas it was radicallyr eplaced byRISC in the workstation market. History indicates that unlike the PC market, the workstation market consisted of a large number of power users, who are less sensitive to compatibilitythan ordinaryusers. Our numerical analysis indicates that the exploration of a new, incompatible technologyis more likelyto increase the chance of firm growth when there are a substantial number of power users or when a new technologyis introduced before an established technologytakes off. (; ; ;