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Heuristics-in-use in industrial interfirm-collaborating clusters

Wen-Hsiang Lai (Feng Chia University, Taichung, Taiwan)
Arch G Woodside (Department of Marketing, Boston College, Carroll School of Management, MA, USA.)

Journal of Business & Industrial Marketing

ISSN: 0885-8624

Article publication date: 1 May 2015

800

Abstract

Purpose

The purpose of this paper is to help interfirm-collaborating cluster (ICC) executives examine the relevance of alternative decision rules in practical business contexts. Multi-party-implemented strategies and establishing multi-lateral collaborations are necessary actions for achieving success in new product development by small and medium enterprises (SMEs). This study explores interfirm decision-making heuristics relating to industrial ICCs.

Design/methodology/approach

The study examines the relevancy to decision making in ICCs of heurstics such as “fast-and-frugal decision trees” (FFDTs) and “take-the-best” (TTB) to processing possibly influential decision-making cues. The study also examines simple heuristics versus the value of a “fully rational” approach to making decisions – calculating cue values, importance weights, multiplying values by weights, summing and selecting the option having the highest summed score. This study included interviewing executives of the pivotal firm in an ICC.

Findings

This study reveals a decision-making solution for shortening the time and processes required in seeking new business collaboration partners in an ICC. This study not only develops a FFDT for six decision-making modules to quickly identify potential collaboration partners, but it also constructs a decision systems analysis (DSA) flowchart to effectively shorten the decision-making process.

Research limitations/implications

This study is in accordance with the general type of industrial interfirm collaboration in Taiwan. The industrial interfirm collaboration could be further divided into the types of formal, semi-formal and informal industrial interfirm collaborations.

Practical implications

This study argues that firms usually find it difficult to develop their own technology because of the high costs of research and development for SMEs. Therefore, firms need to collaborate with partners to maintain their competitive advantage. However, to collaborate, firms must learn to trust their collaboration partners, and the degree of collaboration also strongly depends on the degree to which they trust their collaboration partners.

Originality/value

This study provides the efficient models of FFDT and DSA to quickly identify potential collaboration partners and to effectively shorten decision-making processes.

Keywords

Acknowledgements

The authors appreciate the financial support of Taiwan’s National Science Council (NSC, project ID: NSC 100-2628-E-035-004).

Citation

Lai, W.-H. and Woodside, A.G. (2015), "Heuristics-in-use in industrial interfirm-collaborating clusters", Journal of Business & Industrial Marketing, Vol. 30 No. 3/4, pp. 394-404. https://doi.org/10.1108/JBIM-09-2012-0167

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited

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