Worlds Apart? A Comparison of the New Product Development Strategies of Biopharmaceutical Firms in Europe and the USA

Globally the biopharmaceutical industry is characterized by strong competition, research-intensive and protracted new product development (NPD) processes, intensive regulation and extensive alliance activity. Policy regimes and operating environments differ markedly, however. Here we examine how these differences impact on the NPD strategies of biopharmaceutical firms in the USA and three major EU economies (the UK, France and Germany). Our analysis suggests four key differences between firms' NPD strategies in the two areas. First, while levels of R&D intensity and continuity are broadly similar in the two areas, US firms have notably stronger patent profiles, and are significantly more active in technology licensing than their European counterparts. Second, product development cycles are significantly longer in the USA than among our European respondents. Third, the nature of the product development pipeline is very different in the USA and the major European economies covered by our study: US firms conduct early stage development of more compounds than European firms but take only a similar number to market. Fourth, we see broadly similar levels of alliance activity in our US and European respondents at both the early and late stages of the NPD process. These results suggest a greater substitution of “market” for “hierarchy” in US firms' NPD strategies, reflecting differences in the availability and structure of government support in the USA and Europe.     

Dancing with wolves: how value creation and value capture dynamics affect complementor participation in industry platforms

ABSTRACT

Industry platforms shape the interactions among participating firms, especially between the platform owner and its complementors. However, little research has examined how such dynamics would influence the initial participation by complementors. Based on the coopetition perspective, we develop hypotheses about the relationship between platform owner’s value appropriation potential and complementor participation, at platform initiation. Using a comprehensive dataset of open source software (OSS) platform initiations, this study empirically examines how the resource profiles of platform owner firms may affect complementor participation in the platform. We find that when the platform owner has higher percentage of sales from complementary market segments, the number of complementors for the platform is lower. Furthermore, the platform owner’s sales growth positively moderates this relationship. The findings shed new lights on how the value creation and value appropriation dynamics between the platform owner and its complementors may shape the outcome of industry platform launching.     

Sequencing and batching procedures for minimizing earliness and tardiness penalty of order retrievals

External involvement in new product development (NPD) has received increasing attention from both academicians and practitioners in recent years. While external involvement has been studied extensively, the academic understanding on how external involvement influences firm performance and the role of time-to-market of new products is still very limited. Drawing on the literature on innovation search and knowledge-based view, we develop a conceptual framework in which external involvement is linked to time-to-market of new products and firm performance. We tested this model using data collected from 176 manufacturing companies in China. The results indicate that both customer and supplier involvement can contribute to the reduction of time-to-market of new products. We also show that time-to-market of new products completely mediates the relationships between two types of external involvement and two dimensions of firm performance. These findings have important implications for research and practice in both the external involvement and the NPD areas.     

Performance Effects of Exploratory and Exploitative Innovation Strategies and the Moderating Role of External Innovation Partners

In today's dynamic environment, the involvement of external partners in the innovation process is frequently assumed to be a panacea to cut costs while improving outcomes. In this study, we scrutinize how different collaboration types influence the effects of exploitative and exploratory innovation strategies on new product development (NPD) performance. For our analyses, we draw on a survey comprising a sample of 254 technology-based German firms. Our findings indicate that exploitative strategies are best pursued without comprehensive external collaborations, while the involvement of several partners in a balanced approach is most promising for exploratory strategies. Joint exploration with competitors, in particular, shows the highest effects on NPD performance. The paper discusses the findings and provides several implications for future research.     

Effects of marketing–manufacturing integration across stages of new product development on performance

Our understanding on the benefits of marketing–manufacturing integration (MMI) across various stages of new product development (NPD) process is limited. Based on the resource-based view of a firm, this study empirically examines the direct and interactive effects of MMI in four stages of NPD process on three dimensions of new product performance. Survey data from 214 completed NPD projects in Chinese manufacturing firms are employed to test the developed hypotheses using hierarchical regression. The results indicate that greater MMI in each stage is, respectively, associated with faster NPD speed. Stronger MMI in business/market opportunity analysis (BMA), technical development (TD) and product testing (PT) stage is, respectively, associated with higher NPD cost efficiency. Higher MMI in BMA and PT stage is, respectively, associated with better market performance. In addition, the interactions of MMI in BMA and TD stages and MMI in PT and product commercialization (PC) stages have positive effects on NPD speed and NPD cost efficiency, while the interaction of MMI in BMA and PC stages has negative effects on NPD speed and NPD cost efficiency. The interaction of MMI in BMA, TD and PC stages is positively related to market performance; surprisingly, the interactions of MMI in BMA, TD and PT stages and MMI in BMA, PT and PC stages are negatively related to market performance. These findings have important implications for research and practice in both the cross-functional integration and NPD areas.     

Exploring the relationship between types of family involvement and collaborative innovation in design-intensive firms: insights from two leading players in the furniture industry

ABSTRACT

Innovation in family firms has attracted considerable interest from scholars and practitioners in recent years. However, further theoretical and empirical research is needed to illuminate the intricate relationship between family involvement and innovation. This article studies the effect of different types of family involvement on the management of collaborative innovation. Based on empirical evidence from two leading Italian design-intensive firms in the furniture industry (B&B Italia and Cassina), this study illuminates how family involvement in control and management influences the way design-intensive firms collaborate with external designers to innovate their products. We use two indicators, design renewal and design identity, to capture differences in collaboration approaches through which design-intensive family firms involve external designers. Thus, our findings contribute to understanding how collaborative innovation is managed in family firms. This article also provides family firm owners and managers with insights on the forces that influence the collaborative innovation processes in design-intensive firms.     

When does the diverse partnership of R&D alliances promote new product development? The contingent effect of the knowledge base

Diverse R&D alliance partnerships not only provide access to broad external knowledge but also bring considerable expenses caused by transaction costs and absorption problems. The effective utilization of external knowledge in developing new products is closely related to the internal knowledge base. This study examines how firms' knowledge base properties influence the relationship between diverse R&D alliance partnerships and NPD performance. We empirically find that increases in firms' knowledge complementarity reinforce the positive impact of diverse alliance partners on NPD performance, but increases in firms’ knowledge substitutability attenuate. These findings offer valuable managerial implications that firms should commit more seriously to their internal knowledge base so that they can achieve higher NPD performance when establishing R&D alliances with external actors.     

Performance measurement for new product development: a model based on total costs

The modern market is characterized by consumer demand for quality products (at lower prices), reduced time to market, and cost-savings pressures on manufacturers. To survive in this competitive environment, enterprises must be able to manage and measure their performance with respect to new product development (NPD). This paper presents a cost-effective performance-measurement system for NPD. The model is based on the concept of total-costs analysis. This provides a transparent statistical model that assists management and employees to understand the importance of doing things right the first time. The model incorporates the interactions among NPD teams, manufacturing teams, and customers. It also integrates the results of instances of poor quality at various stages of the NPD process, including: (1) development; (2) manufacturing (the internal customer's perspective); and (3) external customers. A total-costs analysis is thus developed and utilized in planning and establishing a measurement system for NPD performance. The model can be used to satisfy both internal and external customers, and to ensure optimal value for investment in NPD teams.     

Do the Performances of Innovative Firms Differ Depending on Market-oriented or Technology-oriented Strategies?

Despite a perception to the contrary, the performances and values of innovative firms can differ. While people are preconditioned to believe that these firms perform well and have high valuations, this is not always the case. In order to explain this phenomenon, we adopt a lens of strategic orientations that influence innovation: market orientation and technology orientation. By using 10-year panel data, and a content analysis examining the relative orientations of our sample firms, we find that the market-oriented and technology-oriented tendencies of innovative firms influence firm performance and value. Relatively market-oriented innovative firms can guarantee instant performance by offering customers new products and services that they want. However, customers may not be loyal to one particular innovative firm. By contrast, relatively technology-oriented innovative firms are not subject to customers' fastidious choices and have higher firm values. Furthermore, environmental uncertainty negatively influences the relatively market-oriented innovative firms' value as well as sales performance.     

客户参与下的服务型制造系统模型

客户参与的产品服务系统是服务型制造的一个显著特征。针对客户参与度对实施服务型制造的企业产品服务系统绩效难以度量的难题,以客户参与度为变量,构建了客户参与度与客户满意度、市场需求和企业利润的模型。通过分析表明：客户参与产品服务系统能在一定条件下提升客户满意度,实现市场需求和企业利润的增长;并可用平衡积分卡理论诠释四者之间相互支撑的逻辑关系,最后算例验证了上述模型和理论分析的科学与有效性。     

Chatbot for SMEs: Integrating customer and business owner perspectives

PurposeChatbots have been widely adopted to create more positive customer experiences as customers now spend more time in digital environments. Despite the technological advancement and benefits of chatbots for customer service, research on chatbot applications for Small and medium-sized enterprises (SMEs) is limited. The absence of research explaining the struggles faced by SMEs contributes to the gap of SMEs' chatbot adoption. This research determines the features and elements that fit with SMEs’ characteristics and their customers with chatbots.Design/methodology/approachA mixed-methods approach is used to understand SMEs' needs. Study 1 uses interviews with SME business owners and its customers; it aims to explore the features that should be provided by chatbots for SME by identifying combinations between chatbots' generic features and SMEs' customer characteristics. Study 2 tests features identified in Study 1 and surveys 315 SMEs customers to empirically test featured chatbots' influence to anthropomorphism, perceived enjoyment, perceived ease of use, perceived usefulness, and how they affect SMEs’ customer intentions to use chatbots and their shopping intentions.Findings –The findings suggest four combinations of chatbot features that match SME customer characteristics: responsive; simple steps to trigger customer actions; humanized conversations; and personalized recommendations. An experimental survey was designed by creating a chatbot prototype based on these features. The results show that the featured chatbot prototype affects higher anthropomorphism, perceived enjoyment, and perceived usefulness, compared to the standard chatbot. We also find that perceived enjoyment and usefulness positively affect customer's intention to shop and intention to use the chatbot. While anthropomorphism only affect customer's shopping intention to SMEs.OriginalityThis paper contributes to the emerging service literature on the use of chatbots service interactions, particularly for SMEs. This research provides robust explorations from the perspective of both SME owners and customers. For practice, the research provides guidelines on how to design a chatbot for SMEs that meet customers’ needs.     

Product service systems,after-sales service and new product development

After-sales service is a critical element in the successful marketing of many products. Capital goods, for example, manufacturing equipment, require after-sales service such as maintenance and repair in order for customers to get the full value from them. Some manufacturers have started to offer customers an integrated product and service, termed a product-service system in the academic literature. However, in order to deliver such integrated offerings, a different approach to new product development (NPD) is required. This is because the product design influences after-sales service requirements, and so this needs to be considered during NPD. However, researchers have largely ignored the relationship between NPD and service. To address this gap, six in-depth case studies were conducted at leading companies that offer a combined product-service offering, to identify how service requirements are typically evaluated at the design stage. The results show that at companies where after-sales is an important element of the business, service requirements are systematically evaluated during NPD through the involvement of after-sales personnel and the use of field service data to set design goals.     

Bridging customer knowledge to innovative product development: a data mining approach

In the big data era, firms are inundated with customer data, which are valuable in improving services, developing new products, and identifying new markets. However, it is not clear how companies apply data-driven methods to facilitate customer knowledge management when developing innovative new products. Studies have investigated the specific benefits of applying data-driven methods in customer knowledge management, but failed to systematically investigate the specific mechanics of how firms realised these benefits. Accordingly, this study proposes a systematic approach to link customer knowledge with innovative product development in a data-driven environment. To mine customer needs, this study adopts the Apriori algorithm and C5.0 in addition to the association rule and decision tree methodologies for data mining. It provides a systematic and effective method for managers to extract knowledge ‘from’ and ‘about’ customers to identify their preferences, enabling firms to develop the right products and gain competitive advantages. The findings indicate that the knowledge-based approach is effective, and the knowledge extracted is shown as a set of rules that can be used to identify useful patterns for both innovative product development and marketing strategies.     

Unpacking IT use and integration for mass customisation: a service-dominant logic view

Significant changes in customer demands for individualised offerings are causing firms to move away from mass production strategies toward customisation. Many firms struggle in this migration because the requirements for mass customisation (MC) differ greatly from those needed for mass production. As firms strive to optimise their interactions with customers and suppliers to produce highly customised offerings at near mass production prices, IT use along with customer and supply integration are important organisational competencies. Research studies explore many facets of MC but, in regard to IT use for customer and supplier integration, most focus on specific activities within the product design and development process. This study extends the IT-enabled organisational capabilities line of research, using data collected from 220 manufacturers, to explore IT use in a comprehensive sense for planning, infrastructural, and operational activities in various business processes intended to achieve MC. These findings suggest that comprehensive IT use can enhance a firm's integration efforts with customers and suppliers. These factors, in turn, drive operational performance and MC, which lead to firm performance. Grounded in service-dominant logic (SDL) theory, these findings provide theoretical and empirical support to explain why customer integration may be a driving force in MC.     

Influence of organizational elements on manufacturing firms' service-enhancement: An empirical study based on Chinese ICT industry

Despite the growing awareness of the importance of servitization of manufacturing, relatively little study has been performed on how organizational elements may or may not enhance the value creation of manufacturing, and even less in the developing countries. The present study aims to bridge this gap by examining the impact of a set of organizational elements on the service-enhancement in a sample of ICT manufacturing enterprises in China. The results of a multivariate analysis indicate that the degree of service-enhancement (measured by product, customer and financial performance) can be well explained by five organizational elements (service technological capability, strategic orientation (including market and innovation orientation), organization design, and resources endowment). Therefore, it is necessary for firms to consider organizational elements in implementing servitization in manufacturing firms.     

Supplier involvement in new product development projects: dimensionality and contingency effects

In contrast to previous literature, we hypothesize supplier involvement in new product development (NPD) projects to be multidimensional in nature and test this assumption using data from a large sample of NPD projects. We also test the contingent influence of supplier involvement on NPD project performance. The results supported the claim of multidimensionality of supplier involvement. Three distinct factors–communication and information sharing, design involvement and infrastructure–comprising supplier involvement were found. These factors were significantly related to one or more measures of NPD project performance. The study also found support for the contingent influence of market stability on the supplier involvement–NPD project performance relationships. The results suggest that managers ought to consider adopting different bundles of supplier involvement practices that depend on the level of stability in markets and also on the type of NPD performance objective that is being considered.     

Data mining techniques for customer relationship management

Advancements in technology have made relationship marketing a reality in recent years. Technologies such as data warehousing, data mining, and campaign management software have made customer relationship management a new area where firms can gain a competitive advantage. Particularly through data mining—the extraction of hidden predictive information from large databases—organizations can identify valuable customers, predict future behaviors, and enable firms to make proactive, knowledge-driven decisions. The automated, future-oriented analyses made possible by data mining move beyond the analyses of past events typically provided by history-oriented tools such as decision support systems. Data mining tools answer business questions that in the past were too time-consuming to pursue. Yet, it is the answers to these questions make customer relationship management possible. Various techniques exist among data mining software, each with their own advantages and challenges for different types of applications. A particular dichotomy exists between neural networks and chi-square automated interaction detection (CHAID). While differing approaches abound in the realm of data mining, the use of some type of data mining is necessary to accomplish the goals of today’s customer relationship management philosophy.     

Price and lead time differentiation,capacity strategy and market competition

We study a duopoly market in which customers are heterogeneous, and can be segmented as price or time sensitive. Each firm tailors (differentiates) its products/services for the two customer classes solely based on guaranteed lead time and the corresponding price. Our objective is to understand how competition affects price and lead time differentiation of the firms in the presence of different operations strategy (shared versus dedicated capacity), product substitution and asymmetry between the competing firms. Our results suggest that when firms use dedicated resources to serve the two market segments, pure price competition always tends to decrease individual prices as well as price differentiation, irrespective of the market behaviour. Further, the effect of competition is more pronounced when customers are allowed to self-select, thereby introducing substitutability between the two product options. On the other hand, when firms compete in time, in addition to price, the effect of competition on product differentiation depends crucially on the behaviour of the market. Our results further suggest that the firm with a larger market base should always maintain a larger price and lead time differentiation between the two market segments. Similarly, the firm with a capacity cost advantage should also maintain a larger lead time differentiation.     

浅谈小型包装设计公司的生存之道

上海鹏逸包装设计公司是一个专业从事产品包装装潢设计的小公司。旨在专门为商家解决市场竞争中关于产品包装设计的问题。内容决定形式工业基础了能更专心地做好工作，也为了更方便服务好客户，他们选择了更自由更灵活更有弹性的工作方式，近似于SOHO一族。他们并不注重是否有华丽的外表而更注重实际，也正是因为小，他们对自身水平要求更高，更珍惜与客户的合作机会，收费更合理，并由此而赢得“上帝”的青睐。这里，鹏逸公司总经理王方正愿就小型设计公司的生存之道与大家分享他的观点。[编者按]     

Knowledge Composition and Its Influence on New Product Development Performance in the Big Data Environment

Product innovation is regarded as a primary means for enterprises to maintain their competitive advantage. Knowledge transfer is a major way that enterprises access knowledge from the external environment for new product innovation. Knowledge transfer may face the risk of infringement of the intellectual property rights of other enterprises and the termination of licensing agreements by the knowledge source. Enterprises must develop independent innovation knowledge at the same time they profit from knowledge transfers. Therefore, new product development by an enterprise usually consists of three types of new knowledge: big data knowledge transferred from big data knowledge providers, private knowledge transferred from other enterprises, and new knowledge developed independently by an enterprise in the big data environment. To find what the influences of different types of knowledge are on new product development (NPD) performance, a model is presented that maximizes the expected NPD performance. The results show that the greater the weight of independent innovation knowledge, the greater the performance of NPD. Enterprises tend to transfer knowledge from the external environment when the research and development (R&D) investment is much higher, and enterprises will speed up independent innovation when independent innovation knowledge is expected to bring a larger market share. The model can help enterprises to determine knowledge composition, the scale of R&D investment and predict the performance of NPD.