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259
Product development decisions: a review of the literature
- Management Science
, 2001
"... This paper is a review of research in product development, which we define as the transformation of a market opportunity into a product available for sale. Our review is broad, encompassing work in the academic fields of marketing, operations management, and engineering design. The value of this bre ..."
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Cited by 220 (5 self)
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This paper is a review of research in product development, which we define as the transformation of a market opportunity into a product available for sale. Our review is broad, encompassing work in the academic fields of marketing, operations management, and engineering design. The value of this breadth is in conveying the shape of the entire research landscape. We focus on product development projects within a single firm. We also devote our attention to the development of physical goods, although much of the work we describe applies to products of all kinds. We look inside the “black box ” of product development at the fundamental decisions that are made by intention or default. In doing so, we adopt the perspective of product development as a deliberate business process involving hundreds of decisions, many of which can be usefully supported by knowledge and tools. We contrast this approach to prior reviews of the literature, which tend to examine the importance of environmental and contextual variables, such as market growth rate, the competitive environment, or the level of top-management support.
Exploitation, exploration, and process management: The productivity dilemma revisited
- Academy of Management Review
, 2003
"... Organization and strategy research has stressed the need for organizations to simultaneously exploit existing capabilities while developing new ones. Yet this increasingly crucial challenge has been accompanied by an ongoing wave of managerial activity and institutional pressures for process managem ..."
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Cited by 192 (7 self)
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Organization and strategy research has stressed the need for organizations to simultaneously exploit existing capabilities while developing new ones. Yet this increasingly crucial challenge has been accompanied by an ongoing wave of managerial activity and institutional pressures for process management and control. We argue that these pressures stunt a firm’s dynamic capabilities. We develop a contingency view of process management’s influence on both technological innovation as well as organizational adaptation. We argue that while process management activities are beneficial for organizations in stable contexts, they are fundamentally inconsistent with all but incremental innovation and change. We argue that process management activities must be buffered from exploratory activities. As dynamic capabilities are rooted in both exploitative and exploratory activities, ambidextrous organizational forms provide the complex contexts for these inconsistent processes to co-exist. 3 More than twenty years ago, Abernathy (1978) suggested that a firm’s focus on productivity gains inhibited its flexibility and ability to innovate. Abernathy observed that in the automobile
Technological opportunities and new firm creation”,
- Management Science,
, 2001
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The Co-evolution of Capabilities and Transaction Costs: Explaining the Institutional Structure of Production
- Strategic Management Journal
, 2005
"... This paper proposes that transaction costs and capabilities are fundamentally intertwined in the determination of vertical scope, and identifies the key mechanisms of their co-evolution. Specifically, we argue that capability differences are a necessary condition for vertical specialization; and tha ..."
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Cited by 93 (8 self)
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This paper proposes that transaction costs and capabilities are fundamentally intertwined in the determination of vertical scope, and identifies the key mechanisms of their co-evolution. Specifically, we argue that capability differences are a necessary condition for vertical specialization; and that transaction cost reductions only lead to specialization when capabilities along the value chain are heterogeneous. Furthermore, we argue that there are four evolutionary mechanisms that shape vertical scope over time. First, the selection process, itself driven by capability differences, dynamically shapes vertical scope; second, transaction costs are endogenously changed by firms that try to reshape the transactional environment to increase their profit and market share; third, changes in vertical scope affect the nature of the capability development process, i.e., the way in which firms improve their operations over time; and finally, the changes in the capability development process reshape the capability pool in the industry, changing the roster of qualified participants. These dynamics of capability and transaction cost co-evolution are illustrated through two contrasting examples: the mortgage banking industry in the United States, which shows the shift from integrated to disintegrated production; and the Swiss watch-manufacturing industry, which went from disintegration to integration. Copyright © 2005 John Wiley & Sons,
Incumbent entry into new market niches: The role of experience and managerial choice in the creation of dynamic capabilities."
- Management Science
, 2002
"... I ncreasingly, technological innovation creates markets for new products and services. To survive, firms must respond to these new markets. How do firms develop the capabilities necessary to succeed in such changing conditions? Some suggest that experience with previous entry builds such capabiliti ..."
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Cited by 74 (0 self)
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I ncreasingly, technological innovation creates markets for new products and services. To survive, firms must respond to these new markets. How do firms develop the capabilities necessary to succeed in such changing conditions? Some suggest that experience with previous entry builds such capabilities. Others suggest that capabilities arise from experience producing and selling to existing markets. The role of managers is also debated. Some argue that experience with existing markets causes managers to miss entry opportunities. Others argue that managers enter new markets when their firm possesses the experience needed to compete effectively. In this paper, we explore these issues by investigating entry patterns in the disk-drive industry. We investigate the effect of experience in existing markets and experience with previous market entry. We find that experience in previous markets increased the probability that a firm would enter a new market. We show that this experience had greater value if the firm entered the new market. We infer that managers chose to enter these markets to obtain this increase in value.
Technological regimes and new firm formation
- Management Science
"... At least since Schumpeter (1934 and 1942), researchers have been interested in identifying the dimensions of technology regimes that facilitate new firm formation as a mode of technology exploitation. Using data on 1,397 patents assigned to the Massachusetts Institute of Technology during the 1980–1 ..."
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Cited by 59 (2 self)
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At least since Schumpeter (1934 and 1942), researchers have been interested in identifying the dimensions of technology regimes that facilitate new firm formation as a mode of technology exploitation. Using data on 1,397 patents assigned to the Massachusetts Institute of Technology during the 1980–1996 period, I show that four hypothesized dimensions of the technology regime—the age of the technical field, the tendency of the market toward segmentation, the effectiveness of patents, and the importance of complementary assets in marketing and distribution—influence the likelihood that new technology will be exploited through firm formation. (Entrepreneurship; Technology Regimes; Patents)
How much do your co-opetitors’ capabilities matter in the face of technological change
- Strategic Management Journal
, 2000
"... Firms often lose their competitive advantage when a technological change renders their existing capabilities obsolete. An important question that has received little or no attention is, what happens to these firms ’ competitive advantage when the technological change instead renders obsolete the cap ..."
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Cited by 56 (2 self)
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Firms often lose their competitive advantage when a technological change renders their existing capabilities obsolete. An important question that has received little or no attention is, what happens to these firms ’ competitive advantage when the technological change instead renders obsolete the capabilities of their co-opetitors—the suppliers, customers, and complementors whose very success may underpin that of the firm and with whom it must collaborate and compete. This paper explores the effects on a firm of the impact of a technological change on its co-opetitors. It argues that a firm’s post-technological change performance decreases with the extent to which the technological change renders co-opetitors ’ capabilities obsolete. It uses detailed data on the adoption of RISC (Reduced Instruction Set Computer) technology by computer workstation makers to demonstrate the need to view resources as residing in a network and not in the firm alone. Copyright Ó 2000 John Wiley & Sons, Ltd.
Discontinuities and Senior Management: Assessing the Role of Recognition
- in Pharmaceutical Firm Response to Biotechnology,” Industrial and Corporate Change,
, 2003
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The influence of local search and performance heuristics on new design introduction in a new product market
, 1998
"... This study develops and tests three sets of predictions concerning new design introduction during the initial period of ferment in a new product market. We root our predictions most directly in the evolutionary economic concepts of local search and performance heuristics. First, we argue that new en ..."
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Cited by 45 (3 self)
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This study develops and tests three sets of predictions concerning new design introduction during the initial period of ferment in a new product market. We root our predictions most directly in the evolutionary economic concepts of local search and performance heuristics. First, we argue that new entrants will introduce most designs that are new to a product market during an initial period of ferment. Second, we argue that local search will lead most product market incumbents that introduce second or subsequent designs after their entry to introduce designs that are similar to those incorporated in their existing products. Third, we argue that firms selling products based on designs that are losing aggregate share in the market will be likely to introduce products based on new designs, while firms losing market share to firms that are selling the same design are unlikely to introduce new designs. Our empirical analysis examines the magnetic resonance imaging (MRI) subfield of the diagnostic imaging equipment industry between 1980 and 1986, a period that begins with the introduction of the first MRI design and ends with the emergence of widely accepted design characteristics. The results support the argument that local search and performance heuristics, along with other market factors and business characteristics, influence
When does lack of resources make new firms innovative
- Academy of Management Journal
, 2005
"... We extend the resource-based perspective to explain innovation in new firms that have yet to develop resources. Using data on firms ’ efforts to commercialize technological inventions, we tested a model of the environmental conditions under which new firms’ lack of resources alternately promotes or ..."
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Cited by 43 (3 self)
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We extend the resource-based perspective to explain innovation in new firms that have yet to develop resources. Using data on firms ’ efforts to commercialize technological inventions, we tested a model of the environmental conditions under which new firms’ lack of resources alternately promotes or constrains innovation. We found that new firm innovation is greater in competitive and small markets, and in environments that do not demand extensive production assets. When are new firms innovative? Organizational researchers have long studied this question, but mixed findings have emerged from these studies. Some scholars have suggested that new firms, which cannot use existing firm knowledge (Cohen & Levinthal, 1990) and resources (Teece, 1986), have trouble innovating. However, other authors have argued exactly the opposite: New firms are highly innovative because their innovative efforts do not cannibalize their existing products (Arrow, 1962) or require them to filter new knowledge through organizational routines and structures that are ill-suited to that purpose (Henderson & Clark, 1990). More recently, researchers have sought to reconcile these conflicting perspectives by focusing on the nature of the new technology, arguing that new firms are better suited to developing radical innovations than incremental ones (Christensen & Bower, 1996; Hamilton & Singh, 1992). Although extremely informative, this approach fails to explain an important empirical phenomenon: Why are new firms better at innovation in some industries than in others?
