Exploring the Impact of Supplier

Involvement

in New Product Development on Supplier’s Innovation, Product Quality

and Performance

OM 석사 1 학기김동환

Seminar on Technology Strategy

연구제안발표

(2012.12.10)

Index 1. Research Context

2. Research Objective

3. Academic & Practical Needs of the Proposed Research

4. Research Model

5. Theoretical Background

1. Research Context (1/3)■ 우리 생활에 밀접한 자동차 및 전기전자 산업

1. Research Context (2/3)■ 더욱 치열한 경쟁이 이루어지는 자동차 및 전기전자 산업

● 기업의 경쟁 수준이 글로벌 차원으로 확대 ● 고객 Needs 와 Market 의 수요 변동성이 빠르게 변화 ● Customized 제품의 다양화 ● 제품의 Life Cycle 의 단축

▶ ▶ Technology-Intensive Industry

▶ 오로지 제조기업 자신의 역량만으로는 신제품 개발 (New Product Development; NDP) 에 있어서의 경쟁 우위를 유지하기가 어려움 . ⇒ Supplier 를 New Product Development 프로세스에 Involvement

■ Supplier Involvement in NDP

● Because few manufacturers have the complete breadth of knowledge and resources, the importance of interactions in this process put them in great need of acquiring new scientific and technical knowledge from outside organizations. ▶ Mowery et al. (1996), Shenas and Derakhshan (1994)

● Pulling suppliers into a manufacturer’s workplace was one of the big tools to solve these challenges. Since suppliers in cutting-edge industries are the hotbed of innovation. ▶ Nishiguchi and Ikeda (1996)

1. Research Context (3/3)

■ NPD 의 Supplier Involvement 의 Benefit

● Lead Time 의 단축 ▶ Clark (1989) ● Product Development 의 Risk 경감 ▶ Bidault et al. (1998) ● Flexibility 의 증가 ▶ Clark and Fujimoto (1991), Nishiguchi (1994) ● Product Quality 의 증가 ▶ Fujimoto et al. (1996) ● Development Cost 의 절감 ▶ Dyer (1997), Lamming (1993) ● Market Adaptability 의 개선 ▶ Song and Parry (1997) ▶▶ 기존의 Literature 는 대부분 Manufacturer 관점 .

▶ Supplier 관점에서의 Benefit 연구의 부족 .

⇒ 특히 Supplier 의 Performance, Innovation 및 Quality 에 미치는 영향 .

2. Research Objectives

■ 기술 집약적인 산업에 속하는 한국의 자동차 및 전기 / 전자 산업에서 New Product Development 를 위한 Supplier Involvement 가 Supplier 에게 미치는 Effect, 특히

Benefit 관점에 대한 실증 연구 .

3. Academic & Practical Needs of the Proposed Research

■ New Product Development 의 Supplier Involvement 가 기존 연구에서 많이

진행된

Manufacturer 의 Benefit 뿐만 아니라 , Supplier 입장에서의 Benefit 이 있음을

검증함으로써 , 다음의 implication 을 제공하고자 함 .

Benefit 은 Supplier 의 Financial Performance, Innovation 그리고

Product Quality 로 Measure 함 .

- Supplier : 왜 자신들이 적극 참여 (higher level of commitment) 해야

하는지

어떠한 Benefit 을 얻을 수 있는지 Evidence 제공 . - Manufacturer : Supplier 들에게 Win-Win 전략의 확신을 심어주는

Motivation 으로 사용 .

4. Research Model (1/2)

Supplier Involvementin Manufacturer’sNew Product Development

Supplier’s Innovation

Supplier’s Product Quality

Supplier’s Financial

Performance

No. of New Patents

H1

H2

H3

H4

H5

H6

Defect Rate

Profitability

4. Research Model (2/2)■ Hypothesis

H1 : A higher level of supplier involvement has a positive impact on suppliers’ level of innovation.

H2 : A higher level of supplier involvement has a positive impact on suppliers’ product quality.

H3 : A higher level of supplier involvement has a positive impact on suppliers’ financial performance.

H4 : A higher level of supplier innovation has a positive impact on suppliers’ product quality.

H5 : A higher level of supplier product quality has a positive impact on suppliers’ financial performance.

H6 : A higher level of supplier innovation has a positive impact on suppliers’ financial performance.

5. Theoretical Background (1/3)

■ Supplier Involvement and Innovation

● Innovation is critical especially in industries experiencing rapid changes in technology and market demand. ▶ Dickson (1992), D’Aveni (1994)

● Collaboration between firms in the form of technological alliance, R&D consortium, and partnership sourcing is intensified in environments demanding innovative product designs in a shorter period of time. ▶ Buckley and Casson (1988), Lengnick-Hall (1992)

● Sharing knowledge and resources between firms is the important role in corporate innovation. ▶ Anderson and Weitz (1998), Bidault et al. (1998), Bolton et al., (1994), Clark (1989), Dyer and Singh(1998) ; Fujimoto et al. (1996), Sirilli and Evangelista, (1998)

● Innovation for the supplier’s side involves not only new knowledge about parts and modules per se, but also those about ways parts and modules interact and can be configured. ▶ Sanchez and Mahoney (1996)

● Manufacturers impose on suppliers such implicit threats as exercising their superior bargaining power in transaction deals, substituting their partners with other suppliers in case their partners’ innovation efforts do not meet their expectation. ▶ Helper (1996), Sakakibara (1997)

5. Theoretical Background (2/3)

■ Supplier Involvement and Product Quality

● Combining manufacturers and suppliers’ complementary expertise, end products of their cooperation are expected to be superior in product quality as measured by functional performance, reliability, and design in comparison to ones without cooperation. ▶ Shenas and Derakhshan (1994), Swink et al. (1996)

● Supplier involvement in new product development enhances quality by exchanging expertise and information, and by screening multiple alternatives, which can undo wasteful replications or unnecessary errors. ▶ Bonaccorsi and Lipparini (1994), Fujimoto et al. (1996), Nishiguchi (1994),

Nishiguchi and Ikeda (1996), Rolstadas (1995), Song and Parry (1997)

● Supplier involvement is often accompanied by an extensive use of high-tech electronic devices as in CAD, CIM, CNC, and EDI. ▶ Sanchez (1995)

5. Theoretical Background (3/3)■ Supplier Involvement and Financial Performance

● Working together with manufacturers cooperatively in product development, suppliers can validly expect general positive outcomes from supplier involvement in new product development such as fast response to changing market demands, reduction in costs and risks, and quality improvement on the part of manufacturers. These positive outcomes will generate better financial outcomes for suppliers too by sharing of joint profits. ▶ Carter et al. (1995), Hagedoorn and Schakenraad (1994), Helper (1996), Swink et al. (1996).

● Suppliers involved in the manufacturer’s new product development acquire new knowledge and technical capabilities to complement their weaknesses from the manufacturer, and, in some case, from other suppliers. This makes suppliers be able to eliminate waste, to shorten development time, and to systematize various parts at an earlier development stage. ▶ Chadwick and Rajagopal (1995), Hagedoorn and Schakenraad, (1994), Macbeth and Ferguson (1994)

● Supplier involvement in new product development reduces product development costs by shortening development time and preventing unnecessary redesigns . ▶ Clark (1989), Martin et al. (1995), Mowery et al. (1996), Sakakibara (1997), Shenas and Derakhshan (1994), Swink et al. (1996)

Thank You