Can small firms gain relational advantage? Exploring strategic choice and trustworthiness signals in supply chain relationships

Organisational theory explicates that partners who overcome the challenges to developing trust-based interorganisational relationships can gain a vital source of competitive advantage. However, the extant relational research focuses on large, resource-rich entities. We, by contrast and extension, investigate whether small and medium-sized firms can leverage supply chain relationships for competitive advantage. Specifically, power imbalances and resource constraints are additional challenges common to small firms that may diminish their desire and ability to pursue relational advantage. However, we posit that effective, trust-based governance can enable small and medium-sized firms to overcome their unique challenges to enter more collaborative relationships and thereby improve operational and firm performance. Our findings from a survey of manufacturing firms provide evidence that small and medium-sized firms can gain performance benefits when they (1) make the conscious choice to pursue trust-based collaboration and (2) strategically demonstrate trustworthiness.     

Performance ranking of Asian lead frame firms: a slack-based method in data envelopment analysis

With the quick growth of economics, the semiconductor foundry in the Asian area produces a large amount of derived demand for the lead frame. To deal with the quickly changing competitive environment in high technology innovation, better performing firms can constantly capture a competitive advantage. A survey is conducted to obtain the operating data of Asian lead frame firms and a slack analysis in data envelopment analysis (DEA) is applied to identify the benchmarks of the Asian lead frame industry according to their management performance. This study is carried out through literature review and experts’ opinions to conclude assessing factors. This can aid the scholars in their performance evaluation of the related industries. We also interview the CEOs of benchmark firms to attain the outstanding strengths and strategies. In addition, this study investigates the differences among firms in proposing possible improvement strategies for inefficient firms.     

Competitiveness and an Emerging Sector: The Russian Software Industry and its Global Linkages

This paper analyzes the Russian software industry in the context of trade in information technology services. We assess Russia's underlying sources of competitive edge in software, such as its scientific establishments, education system, diaspora and low costs, and identify the institutional impediments to growth. A survey reveals that foreign outsourcing contracts, a high value-added niche and high education levels characterize Russia's small, privately held software firms. A comparison with the Indian software industry underscores the structural differences in outsourcing relationships developed by the two countries and emphasizes that national advantages are complex amalgamations of many factors and need to be overtly marketed. Beyond the resources that give comparative and competitive advantage to a transitioning economy, a critical role is played by powerful industry organizations and by non-market state institutions that can level the economic field and inject credibility into market structures.     

The Evolution of Integrative Capability: Innovation in Cardiovascular Drug Discovery

Recent research has highlighted the ability to integrate fragmentedknowledge across boundaries within a firm as a potentially potentsource of competitive advantage. Yet this research raises apotent tally puzzling question: if these capabilities are socentral to competitive advantage, why do they not instantaneouslydiffuse across an industry? This paper draws on a detailed fieldstudy of the development of hypertensive drugs in 10 major Europeanand American firms to explore this issue. I suggest that anyparticular integrative competence rests on a complex set ofinterlinked factors that usually evolve only slowly over time.Those firms that were fortunate enough to have focused earlyon more 'rational' modes of drug discovery have been much moresuccesssful in developing the integrative capabilities fundamentalto modern drug discovery than those that initially achievedgreat success with the more traditional 'random' method of drugdiscovery. The results thus speak directly to evolutionary theoriesof competence development. They also raise intriguing questionsabout the relationship between the development of competenceand the larger institutional context of the industry, since- both the wealth and prominence of public sector biomedicalresearch and the use of mechanism of action as an integrativedevice appear to have shaped the formation of capability inthe industry.     

Taxonomy of information technology strategy and its impact on the performance of third-party logistics (3PL) in China

This paper develops a taxonomy of information technology strategies used by third-party logistics (3PL) firms in China based on a cluster analysis of survey data from 105 of these 3PL firms. The information technology strategies have been classified into three major groups: supportive, technological, and aligned. The paper also investigates the effect of information technology strategies on information technology advantage, competitive advantage, and financial performance. The results of the study indicate that efforts to improve information technology systems can only be effective if the information technology improvements are properly aligned with a company's overall strategy. It is found that companies that attempt to improve their information technology systems without the proper alignment of information technology with the company's overall strategy can achieve information technology advantages relative to their competitors, but not competitive advantages or improved financial performance. This study is the first attempt to develop an information technology strategy taxonomy for 3PL companies in China. It provides valuable guidance and insights for managers in the development of information technology strategies in 3PL companies.     

Digital transformation of incumbent firms from the perspective of portfolios of innovation

Digital technology has created new elements of innovation types and given incumbent firms new portfolios of innovation. The portfolio of innovation used during a digital transformation allows it to be successfully implemented and gives a competitive advantage to incumbent firms. We present two propositions for the portfolio of innovation and its shift during the process of digital transformation. Based on an emergent innovation matrix, we conducted a multi-case study on three Chinese firms from different industries, in order to identify the novel innovation types that appear when these firms undergo digital transformation. The research suggests that incumbent firms innovate in various ways simultaneously to implement a digital transformation when faced with market and technology change, and the portfolio of innovation shifts during the digital transformation process.     

Innovation Dynamics in Catch-Up Firms: Process, Product and Proprietary Capabilities for Development

This paper analyses how firms organize for industrial innovation where they are significantly below being globally competitive. It investigates the dynamics by which catch-up firms in developing countries (DCs) go beyond the boundaries assigned to them by their national environments and by the world's leading technology-driven firms. The paper analyses cases of how a range of successful firms managed to break these boundaries to increase competitiveness through innovation. Our key argument concerns the innovation dynamics of catch-up firms. We argue that aspirant firms approach the frontier differently to leaders. We construct and use a tool, based on resource-based theory, to map the alternative approaches taken by firms to develop new capabilities. It focuses on the relationship between process and product innovation and the nature of proprietary competencies. This allows the development of approaches to build strategies for innovation in DC catch-up firms and thereby transform development dynamics.     

Competitive pressure: competitive reactions at the group-level

We offer a new perspective on competitive dynamics research by analyzing firms’ reactions to groups of rivals, both at the industry and the strategic group level. We propose that firms observe a buildup of rival actions and perceive increasing ‘competitive pressure’ to respond, which results in greater action volume. Data on the German mobile telephony supports our argument: the volume of firms’ actions is influenced by a buildup of actions by multiple rivals, and firms react more strongly to rivals in their own strategic group.     

A Stackelberg-Nash model for new product design

Existing conjoint approaches to optimal new product design have focused on the Nash equilibrium concept to model competitive reactions. Whereas these approaches have treated all competing firms equally as Nash players, one firm may have an advantage over its rivals, e.g., more pre-experience on competitors’ behavior and/or a first-mover advantage. This paper proposes a Stackelberg-Nash (leader-followers) model which can accomodate such information for decision making. The optimal product design problem is formulated from the perspective of a profit-maximizing new entrant (the leader) who wants to launch a brand onto an existing product market and acts with foresight by anticipating price-design reactions of the incumbent firms (the Nash followers). In the absence of closed-form solutions, we use a sequential iterative procedure to compute a Stackelberg-Nash equilibrium and to establish its uniqueness. The new conjoint model is illustrated under several competitive scenarios and price, design and profit implications are compared to a simple Nash equilibrium model. We find that a Stackelberg leader strategy may not only yield a much higher profit for the new entrant than a Nash strategy, but may also lead to strong profit asymmetries between competitors with still higher profits for the incumbent firms. In other words, the incumbent firms may also benefit strongly from a new entrant choosing a Stackelberg leader strategy.     

Identifying the competitive determinants of firms’ green supply chain capabilities under uncertainty

The link between green supply chain (GSC) and firm performance has been thoroughly studied, and it has been argued that firms are unlikely to perform well if they apply their capabilities in isolation. However, there is a lack of studies that identify the competitive determinants, the critical success factors, of GSC capabilities of firms, and the evaluation of GSC capabilities is predisposed to subjective and linguistic preferences. This study proposes to address the vague nature of qualitative measures using the fuzzy Delphi method to filter the measures and the fuzzy analytic network process to deal with the linguistic preferences in hierarchical structure of firms’ GSC capabilities. Data were collected from supply chain networks of electronic industry in Taiwan. This study presents empirical evidence of firms’ GSC capabilities, concluding that cost is the top competitive determinant and the environmental costs is the top priority of GSC capability.     

The intervening effect of business innovation capability on the relationship between Total Quality Management and technological innovation

The growing diffusion and acceptance in the business world of Total Quality Management (TQM) has attracted greater interest on the part of academia. Although fundamental questions focus on how the different dimensions of TQM can bring about better business performance, a more recent recurring issue pertains to the relationship between TQM and technological innovation and whether technological innovation might provide a source of competitive advantage. Unfortunately, from both theoretical and empirical perspectives, the relationship between TQM and technological innovation appears contradictory and complex. This paper argues that the relationship might be better understood from the contingent perspective of strategic management and thus proposes a multidimensional intervening variable in the relationship, called Business Innovation Capability (BIC). An empirical study of 105 Spanish industrial firms reveals that the effect of some business practices suggested by TQM on technological innovation can be better understood when BIC dimensions are taken into account.     

Relationship between total productive maintenance and performance

Increased global competition has augmented the importance of total productive maintenance (TPM) in obtaining and maintaining a competitive advantage. More and more organizations are seeking proactive tools such as TPM to enhance their competitive position. The paper focuses on gaining insights into the impact of TPM on the performance of the organization. There is support for a positive correlation between TPM and business performance. There is also a positive correlation between TPM and business performance shown by all the six general constructs of corporate planning, top management leadership, human resource focus, process focus, total quality management focus and information system focus, and the three specific constructs of TPM strategies, TPM teams and TPM process focus. Clearly, this indicates the need for TPM to be an integrated effort for the entire organization. In addition, experienced and large TPM firms fare better in terms of business performance while there are no differences in the performance of manufacturing and services.     

Segment set-based part input sequencing in flexible manufacturing systems

In competitive and uncertain business environments, manufacturing firms face various challenges requiring quick response, customisation and cost effectiveness to sustain competitive advantage. This paper proposes a segment set-based approach for the part input sequencing problem of flexible manufacturing systems (FMSs). The segment set theorems are built for the development of the segment set-based approach for the problem. A numerical study is done using simulation, and validated through statistical analyses. Our approach results in the significant performance improvement of the FMSs. Managerial implications are discussed. Further research is also provided.     

Changes in manufacturing facility-, network-, and strategy-types at the Michelin North America Company from 1950 to 2014

Large manufacturing firms operate networks of facilities which they design to achieve particular manufacturing strategies. Facilities, networks and strategies are of several distinct types. The facility-, network- and strategy-types used by a firm depend on the competitive environment in which a firm operates. This paper examines the facility-, network- and strategy-types used by the Michelin North America Company during the period from 1950 to 2014. The examination shows how three changes in the competitive environment (changes in tariffs and government industrial policy, the 1964 Canada – United States Automotive Trade Agreement, and the 1996 North American Free Trade Agreement) triggered significant changes in these types. The examination produces insights into categorisations of facility-, network- and strategy-types that are useful for understanding how large firms operate, how we can predict what changes large firms will make to their facilities, network and strategy and how stakeholders such as employees, suppliers and governments can manage the risks of working with large firms.     

Interestingness of association rules in data mining: Issues relevant to e-commerce

The ubiquitous low-cost connectivity synonymous with the internet has changed the competitive business environment by dissolving traditional sources of competitive advantage based on size, location and the like. In this level playing field, firms are forced to compete on the basis of knowledge. Data mining tools and techniques provide e-commerce applications with novel and significant knowledge. This knowledge can be leveraged to gain competitive advantage. However, the automated nature of data mining algorithms may result in a glut of patterns — the sheer numbers of which contribute to incomprehensibility. Importance of automated methods that address this immensity problem, particularly with respect to practical application of data mining results, cannot be overstated. We first examine different approaches to address this problem citing their applicability to e-commerce whenever appropriate. We then provide a detailed survey of one important approach, namely interestingness measure, and discuss its relevance in e-commerce applications such as personalization in recommender systems. Study of current literature brings out important issues that reveal many promising avenues for future research. We conclude by reiterating the importance of post-processing methods in data mining for effective and efficient deployment of e-commerce solutions.     

Strategic supply chain development by integration of key global logistical process linkages

As manufacturing firms search relentlessly for sources of competitive advantage, a greater emphasis is developing on supply chain management as a means of achieving differentiation in a firm's strategic position. Currently, some researchers are focusing on effective 'end to end' management of key logistical process linkages within the supply chain, as a means of achieving sustainable competitive advantage that is difficult for competitors to emulate. The emphasis presented is on improved delivery performance and customer service. This involves defining optimized balances between supply chain parameters, the achievement of which should result in reduced cost, improved use of working capital, better asset utilization and optimized intra-supply-chain usage. This paper discusses the development of a model and illustrates an application in a major multinational steel producer. Progress has been made in understanding the logistical processes that are used to manage supply chain linkages and, importantly, in understanding the feed-forward and feedback linkages that are necessary to enable supply chain management to be more effective. A generic model for a tiered approach to the planning and scheduling of manufacturing supply chains is thus presented. Ideas for further work are described.     

Exploring the impact of organisational,technological and relational contingencies on innovation speed in the light of open innovation

ABSTRACT

Striving for competitive advantage pushes firms to innovate at a high speed along innovation contingencies and resource limitations they face. Yet, little is known about how management of contingencies such as absorptive capacity or technology radicalness can impact the innovation speed of firms. In this explorative study, we provide new empirical evidence to the innovation speed literature. We examine to what extent innovation speed is affected by organisational, technological, and relational contingencies that preoccupy firms with open innovation practices. Taking the firm perspective, we track innovation timeline and emphasise the complex trade-offs that firms encounter while innovating. Our results show that many of the contingencies, emphasised by the literature promoting innovation, could slow down its speed. Thus, strengthening competitiveness by accommodating contingencies can hinder time-critical adaptations. Furthermore, we find that innovation assets and capabilities can become liabilities for technologically innovative firms.     

生态原产地产品保护是将生态优势转化为竞争优势的制度设计

本文认为生态原产地保护是将优良的生态环境转化为竞争优势的最有利制度,生态原产地保护标志是现代生态文明的国家品牌。为了获得这些竞争优势,提出了加强生态原产地产品保护宣传、完善生态原产地产品保护的监督管理体系等建议。     

Evaluating industrial competitiveness at the office of technology assessment

When the Office of Technology Assessment (OTA) began to study the competitive standing of US industries in 1978, no one had a very clear idea of how to do this. Economists tended to rely on output-side indicators — trade balances and market shares, employment and profit levels. In OTA's view, these were often no more than symptoms. The need was to get at causes — to grasp the dynamics of change in industries as varied as microelectronics and steel and to sort long-run competitive trends from short-term fluctuations. This means understanding the internal workings of firms and industries: how business decisions are made, where investment capital comes from, how new products are developed. While retaining an overall comparative advantage framework, OTA has therefore stressed factors that affect competitiveness as inputs. Among these are product and process technologies, choice of business strategies, and labor force characteristics. To some extent, all are sector-specific and firm-specific. Direct and indirect impacts of federal policies — trade measures, taxes, regulations — have also been central concerns, along with foreign industrial policies. OTA's studies of competitiveness have been subject to extensive external reviews. In the end, however, the critical step has been the development of an independent capability within OTA for weighing the factors that affect competitiveness.     

Pricing strategies for information products with network effects and complementary services in a duopolistic market

In this paper, we model a fully covered duopoly market in which two firms offer a differentiated information product that exhibits positive network effects and a complementary premium service to consumers. For each firm, there are two marketing strategies: the freemium strategy and the bundling strategy. We find that, under the market equilibrium, a firms’ decision whether to employ the freemium strategy or not depends largely on the quality of the information product compared to its rival. When the information product quality is similar and the products’ intrinsic values are sufficiently large, both firms will be better off by adopting the freemium strategy, while the bundling strategy will prevail if the products’ intrinsic values are sufficiently small. Additionally, when the magnitude of complementary effects or network effects exceeds a given threshold, both firms’ profit can be enhanced by an increase in the degree of product complementarity or in the intensity of network effects. We also demonstrate that a firm can benefit from an increasing market size only if the intrinsic value of its information product is sufficiently large. Finally, we extend our model to the uncovered market and derive the equilibrium prices and profits.