The newly internationalizing firm and its capabilities

In this paper we investigate the enablers of early internationalization of the firm. We posit that for firms to internationalize early in their lifecycles, sets of capabilities must be present at the firm’s formative stage and that these capabilities build upon routines that the founders bring into the new firm. These capabilities align to establish a platform for internationalization unencumbered by the administrative heritage often observed in well-established firms that constrains expansion overseas. We model this phenomenon, testing it in an Australian sample of early internationalizing firms. To do so, we draw upon a dynamic capabilities framing, conceptualizing and measuring the dynamic capabilities that founders apply in their early internationalization activities.

Exploiting the Modularity of Value Chains: Inter-firm Dynamics of the Taiwanese Notebook PC Industry

This paper explores the inter-firm dynamics that govern the rise of capabilities of latecomer firms operating in global value chains. By extending and modifying the model proposed by Gereffi, Humphrey and Sturgeon [2005], I present a framework in which the rise of supplier capabilities is determined by interactions among the strategies of the firms. Based on a case study of the Taiwanese notebook PC industry, the paper will explore how the interactions among outsourcing strategies by lead firms from the developed countries, the learning strategies of Taiwanese suppliers, and the product strategy of powerful component vendors have driven the explosive growth of the industry after the 1990s. By so doing, the paper attempts to highlight the active roles firms play in determining the speed and direction of the rise in supplier capabilities.

Supplier competitive advantage in inter-firm business relationships:is Keiretsu really a source of competitive advantage for Japanese automotive suppliers?

This paper explores how firms create and sustain competitive advantage in the inter-firm business relationships from a supplier’s perspective. Ultimately, this paper draws its attention to keiretsu partnerships and how it is perceived by Japanese automotive suppliers. Four main theoretical perspectives (resource based view, industrial organisation, transaction cost economics, and relational network) were considered when developing a conceptual framework based on competitive capability, market diversification, and level of engagement. The framework was examined against two best-practice automotive component suppliers. Later, primary data was also gathered through an interview with a CEO and a survey questionnaire with 11 Japanese companies. As a result, this paper classified these 11 companies into four supplier groups based on tier level (1 and 2) and affiliation condition. Findings propose that there may be little benefit in being an affiliated tier 1 supplier, and that independent tier 2 suppliers may be more competitive than affiliated ones.

Using grounded theory for theory building in operations management research:a study on inter-firm relationship governance

Purpose – Qualitative theory building approaches, such as grounded theory method (GTM), are still not very widespread and rigorously applied in operations management (OM) research. Yet it is agreed that more systematic observation of current industrial phenomena is necessary to help managers deal with their problems. The purpose of this paper is to provide an example to help guide other researchers on using GTM for theory building in OM research. Design/methodology/approach – A GTM study in the German automotive industry consisting of 31 interviews is followed by a validation stage comprising a survey (110 responses) and a focus group. Findings – The result is an example of conducting GTM research in OM, illustrated by the development of the novel collaborative enterprise governance framework for inter-firm relationship governance in the German automotive industry. Research limitations/implications – GTM is appropriate for qualitative theory building research, but the resultant theories need further testing. Research is necessary to identify the transferability of the collaborative enterprise governance concept to other industries than automotive, to other organisational areas than R&D and to product and service settings that are less complex and innovative. Practical implications – The paper helps researchers make more informed use of GTM when engaging in qualitative theory building research in OM. Originality/value – There is a lack of explicit and well-informed use of GTM in OM research because of poor understanding. This paper addresses this deficiency. The collaborative enterprise governance framework is a significant contribution in an area of growing importance within OM.

Collaborative enterprise governance : sustainable management of inter-firm R&D relationships in the German car industry

This research reports on the appropriate governance, i.e. design and management, of inter-firm R&D relationships in order to achieve sustainable competitive success for the whole partnership as well as its individual members. An exploratory study in the German automotive industry using inductive Grounded Theory was conducted. This involved data collection via 28 semi-structured interviews with 16 companies in order to form a set of 35 tentative propositions that have been validated via a questionnaire survey receiving 110 responses from 52 companies. The research has resulted in the consolidation of the validated propositions into a novel concept termed Collaborative Enterprise Governance. The core of the concept is a competence based contingency framework that helps decision makers in selecting the most appropriate governance strategy (i.e. sourcing strategy) for an inter-firm R&D relationship between a buyer and its supplier. Thereby, the concept does not draw on whole company-to-company connectivity. It rather conceptualises an inter-firm relationship to be composed of autonomous cross-functional units of the individual partner companies that contribute value to a particular joint R&D project via the possession of task specific competencies. The novel concept and its elements have been evaluated in a focus group with industrial experts of the German automotive industry and revealed positive effects on the sustainable competitive success of the whole partnership and the individual partner companies. However, it also showed that current practice does not apply the right mechanisms for its implementation and hence guidelines for practitioners and decision makers involved in inter-firm R&D collaboration in the automotive industry are offered on how to facilitate the implementation and usage of the Collaborative Enterprise Governance philosophy.

Filling knowledge gaps:knowledge sharing across inter-firm boundaries and occupational communities

This paper explores the micro-level processes of interaction across organisational boundaries and occupational communities. Based on a retrospective processual analysis, this study shows that in filling knowledge gaps, organisations put in place a series of knowledge mechanisms, which lead them to socially interact with their alliance partners. Both the deployment of existing knowledge and the creation of new knowledge are based on processes of interaction, which derive from the interplay between alliance actors. It is suggested that through both social interaction and the use of boundary objects, individuals are able to communicate, engage in problem-solving activities and share their ideas to fill knowledge gaps.

Understanding inter-firm networks and types of innovation in SMEs:a social network perspective

Innovation is one of the key drivers for gaining competitive advantages in any firms. Understanding knowledge transfer through inter-firm networks and its effects on types of innovation in SMEs is very important in improving SMEs innovation. This study examines relationships between characteristics of inter-firm knowledge transfer networks and types of innovation in SMEs. To achieve this, social network perspective is adopted to understand inter-firm knowledge transfer networks and its impact on innovation by investigating how and to what extend ego network characteristics are affecting types of innovation. Therefore, managers can develop the firms'network according to their strategies and requirements. First, a conceptual model and research hypotheses are proposed to establish the possible relationship between network properties and types of innovation. Three aspects of ego network are identified and adopted for hypotheses development: 1) structural properties which address the potential for resources and the context for the flow of resources, 2) relational properties which reflect the quality of resource flows, and 3) nodal properties which are about quality and variety of resources and capabilities of the ego partners. A questionnaire has been designed based on the hypotheses. Second, semistructured interviews with managers of five SMEs have been carried out, and a thematic qualitative analysis of these interviews has been performed. The interviews helped to revise the questionnaire and provided preliminary evidence to support the hypotheses. Insights from the preliminary investigation also helped to develop research plan for the next stage of this research.

On managing information technology capabilities

Information technology (IT) plays a critical role of enabler of activities that improve the performance of business processes. This enabling role of IT resources means continuous investment in IT is a strategic necessity. It is established that organizations’ IT-related capabilities leverage the enabling potential of IT resources. Today’s turbulent and challenging business environment requires organizations to do more from their existing and newly acquired IT resources. To achieve this, organizations need to discover ways or establish environments to nourish their existing IT-related capabilities, and develop new IT-related capabilities. We suggest one such environment, a dynamic IT-learning environment that could contribute to nourishing existing IT-related capabilities, and developing new IT-related capabilities. This environment is a product of coordination of four organizational factors that relate to the ways in which IT-related knowledge is applied to business processes, the accompanying reward structures, and ways in which the IT-related learning and knowledge is shared within the organization. Using 216 field survey responses, this paper shows that two IT-related capabilities of top management commitment to IT initiatives, and shared organizational knowledge between the IT and business unit managers has a stronger positive influence on business process performance in the presence of this dynamic IT-learning environment. The study also shows that a marginal IT-related capability, technical IT skills, has a positive and significant influence on business process performance in the presence of this environment. These outcomes imply that organizations’ internal environments could contribute to the management of their IT-related capabilities.

Inter-firm complementarities in R&D : a re-examination of the relative performance of joint ventures

We compare duopoly outcomes between two alternative modes of research and development (R&D), viz. independent R&D and non-cooperative research joint ventures (RJVs), when there are complementarities between firm-specific R&D resources. When complementarity is high, RJVs lead to higher technological improvement and the reverse holds for low complementarity. In the intermediate range, the comparison depends on the relative imperfection in spillovers afflicting independent R&D. In sharp contrast to results on cooperative RJVs, non-cooperative RJVs lead to higher technological improvement when spillovers affecting independent R&D are low; the reverse holds for high spillovers. When RJVs yield higher technological improvement, they also yield higher industry profit and social welfare.