The Strength of IT-Based (Virtual) Interfirm Ties in the Development of Complex Product Systems - Information Technology and Product Development - page 177

Fig. 9.2 A typology of
virtually embedded interfirm
CoPS teams

CLIQUE V-
EMBEDDEDNESS

EGOCENTRIC V-
EMBEDDEDNESS

OPEN V-
EMBEDDEDNESS

LINEAR V-
EMBEDDEDNESS

Informal
DEGREE OF ORGANIZATIONAL CONTROL

Formal

embedded interfirm ties are likely to be less expensive to establish because they rely
on existing technological frameworks, and they are also easier to uncouple if need
be, thus overcoming the shortcomings of socially embedded ties that Uzzi (1997)
and Fowler et al. (2004) highlighted.
Although some of these arguments are compelling, we still know little about how
virtual embeddedness will play out in the context of NPD. To understand the role of
virtual embeddedness in its full ramifications, it is beneficial to propose a typology
of the IT-based or virtual ties among firms (see Fig. 9.2). This typology draws on
the traditional characteristics of embeddedness in terms of frequency of interactions,
but in virtual form. This typology is also anchored by the IT usage in organizations,
in terms of organizational channels versus informal connections. Thus, I suggest a
typology where virtual embeddedness can be defined as linear, open, egocentric, or
clique . In the following sections, I discuss these types of virtual embeddedness in
terms of how they apply to NPD in CoPS.

9.4 Linear (or Functional) V-Embeddedness

Virtually embedded interfirm teams of the linear type are typically coupled through
one channel of communication (usually, e-mail or company web environment).
Team members communicate through e-mails that their parent organizations usu-
ally sponsor, thereby ensuring a high degree of organizational oversight. This type
of embeddedness is purely functional in the sense that the collaborating compa-
nies are concerned with resolving specific problems encountered during systems
development.
An advantage of employing this approach to virtual embeddedness is that it pro-
vides “quick fixes” (easy solutions) in situations where speed to market is crucial