Information Technology Reference
In-Depth Information
CoPS comprise high-value products, systems, capital goods, control units, net-
works, and high-technology constructs; tend to be produced in one-off or small
batches; and emphasize systems design, project management, systems engineer-
ing, and systems integration (Hobday, 1998). Two or more companies are usually
involved in developing these systems in a setting where any given firm will be
responsible for developing at least one module of the CoPS. Most often, the teams
that develop these systems are located throughout the world.
For instance, the team of companies that developed the Boeing 787 Dreamliner
included a long list of firms that cut across geographical boundaries: General
Electric (Ohio), Kidde Technologies (North Carolina), Rockwell Collins (Iowa),
Honeywell (Arizona), Rolls Royce (United Kingdom), Dassault Systemes (France),
Mitsubishi Heavy Industries (Japan), Kawasaki Heavy Industries (Japan), and Korea
Airlines-Aerospace Division (Korea).
In addition to the companies that develop modules for the system, others are
responsible for the architectural innovation and systems integration of the CoPS
(Brusoni, Prencipe, & Pavitt, 2001; Henderson & Clark, 1990). For example, Boeing
Commercial Airplanes served as the major systems integrator responsible for devel-
opment, integration, final assembly, and program leadership for the Dreamliner.
NPD teams can find designing, developing, and integrating systems such as the
Boeing 787 Dreamliner to be daunting because the systems and processes involved
are complex.
As a result, a main factor favoring the formation of interfirm network ties between
companies is the growing complexity of products and services, and of their design,
production, and delivery (Gomes-Casseres, 1994). This is because individual com-
panies are unable to develop all the competencies required to develop CoPS. Thus,
companies frequently outsource the development of systems components to other
organizations. In this context, the success of the innovative firm depends pivotally
on the strength of its interfirm ties (e.g., Freeman & Soete, 1997; Prahalad &
Ramaswamy, 2000).
For example, MIPS Technologies and its partners, such as Toshiba, DEC, AT&T,
and Siemens, co-developed reduced instruction set computing (RISC) architecture.
In 1992, when most companies developed this type of product, the company at
the center of each group (in this case, MIPS) usually designed the RISC technol-
ogy, licensed the semiconductor firms to produce the chips, and supplied systems
on an object exchange model (OEM) basis to resellers (Gomes-Casseres, 1994).
Figure 9.1 illustrates the MIPS product development network.
The following section shows how embedded ties between firms as opposed
to mere transactional ties could enhance the value of collaboration in product
development.
9.2.2 The Value of Network Embeddedness
Collaboration between firms is the cornerstone of NPD in CoPS. Companies
increasingly rely on other companies for the information, resources, technologies,
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