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Book part
Publication date: 8 April 2005

Fredrik von Corswant

This paper deals with the organizing of interactive product development. Developing products in interaction between firms may provide benefits in terms of specialization…

Abstract

This paper deals with the organizing of interactive product development. Developing products in interaction between firms may provide benefits in terms of specialization, increased innovation, and possibilities to perform development activities in parallel. However, the differentiation of product development among a number of firms also implies that various dependencies need to be dealt with across firm boundaries. How dependencies may be dealt with across firms is related to how product development is organized. The purpose of the paper is to explore dependencies and how interactive product development may be organized with regard to these dependencies.

The analytical framework is based on the industrial network approach, and deals with the development of products in terms of adaptation and combination of heterogeneous resources. There are dependencies between resources, that is, they are embedded, implying that no resource can be developed in isolation. The characteristics of and dependencies related to four main categories of resources (products, production facilities, business units and business relationships) provide a basis for analyzing the organizing of interactive product development.

Three in-depth case studies are used to explore the organizing of interactive product development with regard to dependencies. The first two cases are based on the development of the electrical system and the seats for Volvo’s large car platform (P2), performed in interaction with Delphi and Lear respectively. The third case is based on the interaction between Scania and Dayco/DFC Tech for the development of various pipes and hoses for a new truck model.

The analysis is focused on what different dependencies the firms considered and dealt with, and how product development was organized with regard to these dependencies. It is concluded that there is a complex and dynamic pattern of dependencies that reaches far beyond the developed product as well as beyond individual business units. To deal with these dependencies, development may be organized in teams where several business units are represented. This enables interaction between different business units’ resource collections, which is important for resource adaptation as well as for innovation. The delimiting and relating functions of the team boundary are elaborated upon and it is argued that also teams may be regarded as actors. It is also concluded that a modular product structure may entail a modular organization with regard to the teams, though, interaction between business units and teams is needed. A strong connection between the technical structure and the organizational structure is identified and it is concluded that policies regarding the technical structure (e.g. concerning “carry-over”) cannot be separated from the management of the organizational structure (e.g. the supplier structure). The organizing of product development is in itself a complex and dynamic task that needs to be subject to interaction between business units.

Details

Managing Product Innovation
Type: Book
ISBN: 978-1-84950-311-2

Article
Publication date: 5 January 2015

Miia Martinsuo and Rami Sariola

The purpose of this paper is to increase understanding on the emergence of mutually beneficial relationships between component suppliers and third parties in projects, and their…

1016

Abstract

Purpose

The purpose of this paper is to increase understanding on the emergence of mutually beneficial relationships between component suppliers and third parties in projects, and their interaction practices in the project and potential new services.

Design/methodology/approach

A qualitative, exploratory research strategy is employed in the context of construction projects, with construction component manufacturers as the focal component suppliers. In total 22 interviews were conducted with structural engineers and architects as relevant third parties, to discover the specifics of component suppliers’ third-party relationship development in construction projects.

Findings

The results show the crucial role of third parties in the constructor’s and customer’s decision-making process, and various ways for component suppliers to develop the relationship toward the third parties. The results offer important knowledge about the cooperation between construction component suppliers and third parties and means to increase the centrality of component suppliers in the project network.

Research limitations/implications

The research was delimited to structural engineers and architects as third parties in construction projects in one country. Further research is encouraged on third-party cooperation in other kinds of project networks, other kinds of third parties, and the various forms of triadic cooperation in project networks.

Practical implications

The results encourage component suppliers to take a proactive approach in developing relationships with third parties, when strengthening their network position. The paper introduces practical ways in which component suppliers may take action toward generating powerful main contractor-supplier-third-party triads.

Originality/value

Limited research attention has been directed at third parties and triadic cooperation in project networks. This paper offers important knowledge about the relationship between component suppliers and third parties, particularly in terms of third parties’ expectations and practical initiatives to enhance the relationships.

Details

International Journal of Managing Projects in Business, vol. 8 no. 1
Type: Research Article
ISSN: 1753-8378

Keywords

Article
Publication date: 7 April 2023

Suyuan Wang, Huaming Song, Hongfu Huang and Qiang Huang

This paper explores how the manufacturer’s strategic choice (acquisition or investment) impacts product quality in a supply chain comprising two complementary suppliers and a…

Abstract

Purpose

This paper explores how the manufacturer’s strategic choice (acquisition or investment) impacts product quality in a supply chain comprising two complementary suppliers and a common manufacturer.

Design/methodology/approach

The manufacturer faces six strategic choices to improve product quality: acquiring or investing in the high-capable supplier, the low-capable supplier, or both. As the Stackelberg leader, the manufacturer determines which strategy is adopted, while suppliers are separately responsible for components’ quality and wholesale prices. The authors use game theory and calculate the model with Mathematica.

Findings

The authors develop analytical models to analyze how acquisition costs, investment proportions, component importance and quality improvement coefficients influence decision-makers. The results show that the highest quality may not benefit the manufacturer. Investing in or acquiring a low-capable supplier is better than a high-capable supplier under certain conditions. If the gaps between two suppliers’ quality improvement coefficients and the importance of two components are dramatic, the manufacturer should choose an investment strategy.

Originality/value

This study contributes to the complementary supply chain management by comparing two kinds of strategies-acquisition and investment, with a high-capable supplier and a low-capable supplier.

Details

The TQM Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1754-2731

Keywords

Article
Publication date: 27 December 2022

Satya Prakash and Indrajit Mukherjee

This study primarily aims to develop and solve an enhanced optimisation model for an assembly product multi-period inbound inventory routing problem (IRP). The many-to-one…

Abstract

Purpose

This study primarily aims to develop and solve an enhanced optimisation model for an assembly product multi-period inbound inventory routing problem (IRP). The many-to-one (inbound) model considers the bill of materials (BOM), supply failure risks (SFR) and customer demand uncertainty. The secondary objective is to study the influence of potential time-dependent model variables on the overall supply network costs based on a full factorial design of experiments (DOE).

Design/methodology/approach

A five-step solution approach is proposed to derive the optimal inventory levels, best sourcing strategy and vehicle route plans for a multi-period discrete manufacturing product assembly IRP. The proposed approach considers an optimal risk mitigation strategy by considering less risk-prone suppliers to deliver the required components in a specific period. A mixed-integer linear programming formulation was solved to derive the optimal supply network costs.

Findings

The simulation results indicate that lower demand variation, lower component price and higher supply capacity can provide superior cost performance for an inbound supply network. The results also demonstrate that increasing supply capacity does not necessarily decrease product shortages. However, when demand variation is high, product shortages are reduced at the expense of the supply network cost.

Research limitations/implications

A two-echelon supply network for a single assembled discrete product with homogeneous vehicle fleet availability was considered in this study.

Originality/value

The proposed multi-period inbound IRP model considers realistic SFR, customer demand uncertainties and product assembly requirements based on a specific BOM. The mathematical model includes various practical aspects, such as supply capacity constraints, supplier management costs and target service-level requirements. A sensitivity analysis based on a full factorial DOE provides new insights that can aid practitioners in real-life decision-making.

Details

Journal of Modelling in Management, vol. 18 no. 6
Type: Research Article
ISSN: 1746-5664

Keywords

Article
Publication date: 5 July 2011

Yohanes Kristianto Nugroho

This paper aims to focus on production ramp up modeling on built‐to‐order (BTO) manufacturers facing customized demand. The general purpose is to present a novel approach to…

1063

Abstract

Purpose

This paper aims to focus on production ramp up modeling on built‐to‐order (BTO) manufacturers facing customized demand. The general purpose is to present a novel approach to managing collaboration, by considering information exchange between the manufacturer and the supplier.

Design/methodology/approach

The methodology applies feedback control mechanism to analyze supplier responsiveness and customer order decoupling point to represent the need for collaboration. A two‐stage game is applied ahead of control system application to optimize the capacity decision, with the ultimate goal being profit maximization.

Findings

The results show that a higher product commonality degree gives more opportunity for quick response BTO supply chains, which are managed by feedback control, and at the same time to possibly mitigate the bullwhip effect caused by demand information noise.

Research limitations/implications

The analytical model here focused on one product family development, so the applicability of the proposed model to the whole product portfolio should be investigated in the future.

Practical implications

This paper helps the manufacturer to act optimally by considering the possibility of information exchange with the supplier and deciding on the product commonality degree, in taking into account the customer's lead time requirement.

Originality/value

A control system model of “BTO Supply Chain” is proposed by including product commonality and response analysis in the simulation model. Furthermore, a contribution to collaborative supply chains is shown by applying a synchronized supply model to represent supplier and manufacturer communication.

Details

Journal of Modelling in Management, vol. 6 no. 2
Type: Research Article
ISSN: 1746-5664

Keywords

Article
Publication date: 21 September 2015

Fabio Cassia, Francesca Magno and Marta Ugolini

This paper explores the process of mutual value creation in a component co-branding relationship between an unknown component supplier and a well-known Original Equipment…

2884

Abstract

Purpose

This paper explores the process of mutual value creation in a component co-branding relationship between an unknown component supplier and a well-known Original Equipment Manufacturer (OEM). In particular, the purpose of this paper is to investigate the antecedents of parties’ willingness to engage in mutual value creation, thus enriching Grönroos and Helle’s (2010, 2012) model of mutual value creation.

Design/methodology/approach

An in-depth longitudinal analysis of a single case study in the cycling wear industry is presented based on data gathered from several sources, including long interviews with managers of a component supplier and an OEM, promotional materials, press releases and articles in cycling-related publications and on web portals, and online conversations among amateur cyclists.

Findings

Four antecedents of the willingness to engage in mutual value creation are identified: mutual trust; the perceived easiness of alignment between the supplier’s and OEM’s processes and resources relevant to value creation; the expected creation of a substantial level of additional mutual value; and the expected value gains for each party.

Research limitations/implications

The study analyses only one case in a single industry and adopts a dyadic perspective.

Practical implications

This study suggests that – contrary to the traditional view – when specific antecedents for mutual value creation are present, the component co-branding strategy is available to many innovative small- and medium-sized firms without strong brands.

Originality/value

Beyond enriching Grönroos and Helle’s (2010, 2012) model, this study explains why co-branding relationships can be established even in the absence of a strong component brand.

Details

Management Decision, vol. 53 no. 8
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 1 February 1998

A.I. Millington, C.E.S. Millington and M. Cowburn

This paper explores the conditions under which motor component manufacturers may choose to supply car assembly plants through decentralised production in local assembly units…

1559

Abstract

This paper explores the conditions under which motor component manufacturers may choose to supply car assembly plants through decentralised production in local assembly units (LAUs). The analysis is based on a case study of the decision to supply motor exhausts through an LAU where demand from the OEM company is sequenced. The case suggests that local assembly may result in significant efficiency gains. However, most of these gains flow to the OEM company, while most of the costs of local assembly flow to the component supplier. This finding emphasises the importance of trust and collaboration within supplier relationships, but suggests that significant possibilities for opportunistic recontracting may exist after the establishment of the LAU. Both supplier and OEM company should consider these possibilities when making the initial investment decision.

Details

International Journal of Operations & Production Management, vol. 18 no. 2
Type: Research Article
ISSN: 0144-3577

Keywords

Open Access
Article
Publication date: 6 June 2023

Xiaogang Cao, Hui Wen and Bowei Cao

In this paper, the authors study the production and pricing decisions of a remanufacturing supply chain composed of a supplier, an assembler and a remanufacturer, in which the…

Abstract

Purpose

In this paper, the authors study the production and pricing decisions of a remanufacturing supply chain composed of a supplier, an assembler and a remanufacturer, in which the remanufacturing of components requires patent licensing from the supplier.

Design/methodology/approach

The authors consider three different models with government subsidy for remanufacturing: (1) no government subsidies; (2) the government subsidizes the remanufacturing behavior of the supplier and (3) the government subsidizes the remanufacturing behavior of the remanufacturer and use the Stackelberg game model to solve and analyze the equilibrium wholesale prices of components and the equilibrium outputs of new and remanufactured products under three subsidy modes.

Findings

The results show that the equilibrium wholesale prices of two kinds of components decrease with the unit patent licensing fee and the unit government subsidy, and the equilibrium quantity of the remanufactured products under the three modes is obviously higher than that of the new products.

Originality/value

Finally through numerical simulation, it is found that the equilibrium profits of the supplier, the manufacturer and the supply chain increase monotonously in relation to the unit government subsidy, while the optimal profit of the assembler in relation to the unit government subsidy tends to decrease first and then increase.

Details

Modern Supply Chain Research and Applications, vol. 5 no. 2
Type: Research Article
ISSN: 2631-3871

Keywords

Article
Publication date: 18 January 2021

Anna Dubois, Lars-Erik Gadde and Lars-Gunnar Mattsson

The purpose of the paper is to describe and analyse the evolution of the supplier base of a buying firm and the reasons behind these changes.

Abstract

Purpose

The purpose of the paper is to describe and analyse the evolution of the supplier base of a buying firm and the reasons behind these changes.

Design/methodology/approach

The paper is based on a case study of the changes over 52 years in a sub-set of the supplier base of a firm manufacturing fork-lifts.

Findings

The study shows that some relationships feature substantial longevity. However, the duration of one-third of the total relationships is shorter than five years. There was considerable variation over time in the dynamics of the supplier base in terms of entries and exits of suppliers. Owing to this variation, research findings and conclusions in short-term studies are heavily dependent on the specific conditions at the time of the study. Finally, no less than one-fourth of the terminated supplier relationships were reactivated later.

Research limitations/implications

The study was designed in a time when purchasing was considered entirely from the perspective of the buying firm. Further studies, therefore, must increasingly emphasise the role of suppliers and the interaction in the buyer–supplier relationships, as well as the embeddedness in networks.

Originality/value

The findings of the study are unique in two ways. First, they are based on systematic observations over more than 50 years. Second, the study involves the purchases of 11 components representing different technical and economic features. The (few) previous studies are based on much shorter time periods and involves fewer suppliers/components. Moreover, the findings regarding re-activation of terminated relationships represent unique contributions.

Details

Journal of Business & Industrial Marketing, vol. 36 no. 5
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 29 April 2021

Suyuan Wang, Huaming Song and Canran Gong

Companies face the critical reliability problem of products due to the development of outsourcing. This study intends to provide some feasible solutions for a company to improve…

227

Abstract

Purpose

Companies face the critical reliability problem of products due to the development of outsourcing. This study intends to provide some feasible solutions for a company to improve the reliability level of products.

Design/methodology/approach

The paper considers the reward and reliability decisions regarding a product made with two complementary components from two different suppliers: high-capable and low-capable. Two kinds of reliability improvement incentives (normal incentive and cost-sharing incentive) through which a manufacturer provides a reward and shares the reliability improvement cost with a supplier are discussed. As the Stackelberg leader, the manufacturer determines the strategy, while the suppliers are responsible for determining its reliability. Using a game-theoretic framework, four different contract scenarios are addressed. We develop analytical methods to better understand how the manufacturer decides the incentive mechanism to be used for the suppliers.

Findings

The results show that cost-sharing contracts do not always lead to a higher reliability level and more enormous profits. Setting a target reliability level is better for the manufacturer. The cost-sharing contract is beneficial for a high-capable supplier even though it does not directly participate in that kind of mechanism. A low-capable supplier gains more profit when the manufacturer provides incentive mechanisms that do not specify a target reliability level.

Originality/value

This paper investigates the reliability improvement mechanism used for complementary products and focuses on identifying the optimal decisions when demand is influenced by the gap between the product's failure rate and the standard failure rate.

Details

The TQM Journal, vol. 33 no. 8
Type: Research Article
ISSN: 1754-2731

Keywords

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