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Sarah Franz, Axele Giroud and Inge Ivarsson
This study aims to analyse how multinational corporations (MNCs) organise value chain activities to penetrate new market segments. It contributes by expanding traditional…
Abstract
Purpose
This study aims to analyse how multinational corporations (MNCs) organise value chain activities to penetrate new market segments. It contributes by expanding traditional decisions regarding the vertical fine-slicing of value chain activities (whether performed internally or externally) and the consideration of resource-sharing decisions (integration or separation) for each value chain function.
Design/methodology/approach
The authors draw on primary data collected from two case study firms operating in the large emerging Chinese market: Volvo Construction Equipment AB and Epiroc AB. In-depth cases illustrate how foreign MNCs expand into new market segments and simultaneously target both the lower-priced mid-market and the premium segments in the Chinese mining and construction industry.
Findings
The results reveal that product diversification creates challenges for managers who must oversee new (vertical) value chains, often simultaneously. Beyond geography and modes of governance, managers must decide whether to integrate or separate value chain activities for the new product lines. The study identifies four main strategic choices for firms to address this complexity, focusing on the decision to internalise or externalise (i.e. within or across organisational boundaries) and integrate or separate value chain activities between different product lines.
Originality/value
This study builds upon the internalisation theory and recent international business contributions that focus on value chain configurations to explain MNCs’ product diversification as a growth strategy in a host emerging market. It also sheds light on the choice of conducting new activities in-house or externally and elucidates firms’ managerial decisions to operationally integrate or separate individual value chain activities. The study provides insights into the drivers explaining managerial decisions to configure value chain activities across product lines and contributes to the growing body of literature on MNC activities in emerging economies by highlighting that product diversification impacts entry mode diversity and resource sharing across units.
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Niloofar Kazemargi, Ernesto Tavoletti, Andrea Appolloni and Corrado Cerruti
The purpose of this paper is to investigate how focal firms in supply networks manage weak and strong ties for exploration and exploitation innovation in mature industries. In…
Abstract
Purpose
The purpose of this paper is to investigate how focal firms in supply networks manage weak and strong ties for exploration and exploitation innovation in mature industries. In doing so, the paper extends the understanding of how focal firms manage open innovation (OI).
Design/methodology/approach
The empirical base is a multiple case study conducted on three companies operating in mature industries in Europe.
Findings
Findings of this study reveal, analyze and explain a diverse set of OI practices in the supply networks of mature industries in which the focal firms integrate strong and weak supply ties to enhance innovation outcomes. This study provides a fine-grained view of the benefits of the additive and interactive effects of strong and weak ties in OI. More specifically, the analysis reveals an enhancing role of strong supply ties in exploration, which previously was associated solely with weak ties. Moreover, this study sheds light on the dominant and orchestrating roles of focal firms.
Practical implications
The findings provide insights to enhance OI practices beyond the limited role of the weak ties of the supply network and highlight the essential role of the strong supply ties in mature industries.
Originality/value
While previous studies have associated exploration with weak ties, findings of this study reveal that exploration-oriented activities in mature industries also extend to strong ties. In the strong ties of mature industries, this study finds there is not only the exploitation of existing knowledge but also the reconfiguration and innovation of products.
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Pirouz Nourian, Samaneh Rezvani, Kotryna Valeckaite and Sevil Sariyildiz
The most sustainable forms of urban mobility are walking and cycling. These modes of transportation are the most environmental friendly, the most economically viable and the most…
Abstract
Purpose
The most sustainable forms of urban mobility are walking and cycling. These modes of transportation are the most environmental friendly, the most economically viable and the most socially inclusive and engaging modes of urban transportation. To measure and compare the effectiveness of alternative pedestrianization or cycling infrastructure plans, the authors need to measure the potential flows of pedestrians and cyclists. The paper aims to discuss this issue.
Design/methodology/approach
The authors have developed a computational methodology to predict walking and cycling flows and local centrality of streets, given a road centerline network and occupancy or population density data attributed to building plots.
Findings
The authors show the functionality of this model in a hypothetical grid network and a simulated setting in a real town. In addition, the authors show how this model can be validated using crowd-sensed data on human mobility trails. This methodology can be used in assessing sustainable urban mobility plans.
Originality/value
The main contribution of this paper is the generalization and adaptation of two network centrality models and a trip-distribution model for studying walking and cycling mobility.
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Despite its significance, research on how attribute framing affects ordering decisions in dual sourcing remains insufficient. Hence, this study investigated the effects of…
Abstract
Purpose
Despite its significance, research on how attribute framing affects ordering decisions in dual sourcing remains insufficient. Hence, this study investigated the effects of attribute framing in a sourcing task involving certain and uncertain qualities of two suppliers and analysed the role of attention with respect to suppliers' information in framing effects.
Design/methodology/approach
The impacts of attribute framing on sourcing decisions were demonstrated in two online between-subject (2 × 2 factorial) experimental studies involving professional samples. Study 2 was an eye-tracking experiment.
Findings
In Study 1 (N = 251), participants presented with a “high-quality” rather than a “low-quality” frame made different sourcing decisions, opting for larger percentage of order(s) from a supplier under the “high-quality” frame. This pattern holds true for suppliers who differ in risk. This finding was replicated in Study 2 (N = 129). Attention asymmetry related to the information on supplier quality contributes to this effect. Attention directed towards information regarding the supplier's quality under a positive frame mediated the relationship between attribute framing and sourcing decisions.
Practical implications
Highlighting the positive attributes of a risky supplier is essential when ordering from the risky supplier is an optimal decision. It is advantageous for suppliers to highlight positive rather than negative attributes when describing the quality of their components against others.
Originality/value
This is the first study to examine the effect of attention on the relationship between attribute framing and dual sourcing. This presents a new behavioural perspective wherein managers' attention to information plays a vital role.
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