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Conditions to introduce new functionality in a mature industry with modular product structure
Linköping University, Department of Management and Economics. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Economics. Linköping University, The Institute of Technology.
(English)Manuscript (preprint) (Other academic)
Abstract [en]

The paper deals with the introduction of innovations adding new functionality to a mature and modularizcd industry. The purpose of the paper is to describe and analyze 1) the technical dependencies between the innovation and the established product architecrure and 2) the organizational dependencies between the young technology-driven firm and the established firms. The paper is based on a case study containing two firms involved in the development of active safety applications in the automotive industry. One firm is a young technology-driven firm acting as a highly innovative R&D collaborator to the other firm which is an established manufacturing firm responsible for the final product. The case shows that although a young technology-driven firm may well be aware of its state-of-the-art technical capabilities, limited knowledge of the more subtle managerial requirements needed to get the innovation accepted by established firms impede marker success. The managerial requirements indicated in the case include an understanding of how power dependencies strongly influence the ability to introduce an innovation in a mature and modularized industry. The conclusion of the paper is that power dependence between different organizations within the mature and modularized industry obstructs the possibilities for young technology-driven firms to enter inro the prevailing industry structure. Based on power dependence relations the paper argues that product architecture does not create the frame for the differem modules in a one-way manner, but also that the fixed modules create the frame for the kind of architecture possible to design.

National Category
Engineering and Technology
Identifiers
URN: urn:nbn:se:liu:diva-100793OAI: oai:DiVA.org:liu-100793DiVA: diva2:663700
Available from: 2013-11-12 Created: 2013-11-12 Last updated: 2013-11-12
In thesis
1. Modular Innovation in Mature Structures
Open this publication in new window or tab >>Modular Innovation in Mature Structures
2005 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

The field of interest in this study is modular innovation. This type of innovation replaces an old parr of an existing product or adds new functionality to an existing product. Modular innovations are important to increase the performance of an existing product and retain the competitiveness of the product. The purpose of this thesis is to: suggest some explanatory factors that can influence how and if modular innovation, which adds new functionality to an existing product, can become adopted within a mature industry. To achieve this purpose the analysis has been divided in two levels. The first level analyses how the modular innova· tion firs with the product architecture of the final product. The second level analyses how the industrial structures within the industry affects the possibilities for an entrant firm to establish oneself as a new supplier. The empirical data is collected from the automotive industry. The study is based on in-depth interviews.

The study illustrates that there is a difference between modular innovation that replace an existing module and modular innovation which adds new functionality to an existing product. In addition, the driving forces for replacing and adding innovation are different. The driving force for modular innovation which adds new functionality is linked with recognition of new needs. In contrast, replacing modular innovation is driven by competitive forces based on well-known parameters and the search for new technical solutions which can improve the performance of the existing module.

The study shows how industrial structures affect the possibility for entreating firms to introduce new modular innovation. Although the innovation in technical terms very well fits the final product it is far from certain that the innovation will become adopted. Aggravating circumstances for new entrants is the lack of organizational resources. Due to the lack of resources, entreating firms can benefit from having owners active within the target industry. Moreover, the imerdependences between the established firms in the industry obstruct the possibilities of established firms to adopt innovations from new suppliers.

Place, publisher, year, edition, pages
Linköping: Linköpings universitet, 2005. 48 p.
Series
Linköping Studies in Science and Technology. Thesis, ISSN 0280-7971 ; 1188Dissertations from the International Graduate School of Management and Industrial Engineering, ISSN 1402-0793 ; 95
National Category
Social Sciences
Identifiers
urn:nbn:se:liu:diva-28878 (URN)14074 (Local ID)91-85457-12-4 (ISBN)14074 (Archive number)14074 (OAI)
Available from: 2009-10-09 Created: 2009-10-09 Last updated: 2013-11-12

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Jönsson, PetterGrundström, Christina

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