Managing joint development of process technologies : empirical studies of interorganizational collaboration within the process industries

The concept of open innovation has gained widespread acceptance in different lines of research, and it has had a major impact on both research and practice during the last decade. The inherent logic of open innovation is simply that firms can and should use external as well as internal knowledge and information sources, and both internal and external paths to market, when they seek to maximize returns from development activities. While the mainstream literature has mainly reported on open innovation during product development, this thesis highlights the importance of open innovation activities during process development. Indeed, strong collaboration and significant joint development activities are typically required between buyers and suppliers when developing and implementing new process technologies. This is especially true in the process industries where process development is a key source of competitiveness. However, joint process development projects in this setting are often plagued by severe budget overruns, time delays, and quality problems. Developing and implementing new process technology is thus a risky endeavor that may seriously endanger long-term competitive advantages and the financial viability of firms if not managed proficiently. In particular, these projects are often complex to manage, as interdependencies among a number of actors, activities, and the overall process design create problems and information gaps for both buyers and suppliers. Therefore, there is a need for increased knowledge to facilitate improved collaboration so as to decrease the risk of project failure. Accordingly, the purpose of this thesis is to increase the understanding of how process firms and equipment suppliers can improve the management of joint development projects.Empirically, the results are based on three case studies and a comprehensive project-level survey within the process industries. The thesis is based on empirical data from 84 interviews with employees of two process firms and nine equipment suppliers as well as 251 survey respondents from 52 joint development projects. These numbers include respondents from eight European countries. The results can be summarized in a number of points. First, firms should revise their development processes to manage interorganizational collaboration. Second, different problems and collaborative activities must be managed as the project progresses from development to implementation. To this end, different stages require different participants and different modes of communication and coordination among participants. Thus, the content and the intensity of the collaboration should be tailored to the information processing needs in different stages of the equipment’s lifecycle. To support an appropriate collaboration process, firms should tailor their procurement procedures to the characteristics of the project. These findings present a number of implications for managers and practitioners alike in light of the increasing importance of interorganizational collaboration and process development