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Outsourcing of NPD Activities: A best practice approach
Halmstad University, School of Business and Engineering (SET), Centre for Innovation, Entrepreneurship and Learning Research (CIEL), Centre for Technology, Innovation and Marketing Management (CTIM2).ORCID iD: 0000-0002-8603-9269
Halmstad University, School of Business and Engineering (SET), Centre for Innovation, Entrepreneurship and Learning Research (CIEL), Centre for Technology, Innovation and Marketing Management (CTIM2).
2010 (English)In: European Journal of Innovation Management, ISSN 1460-1060, E-ISSN 1758-7115, Vol. 13, no 1, p. 5-23Article in journal (Refereed) Published
Abstract [en]

Purpose – The purpose of this paper is to improve our understanding of outsourcing NPD, and specifically of factors affecting the outsourcing decisions, by exploring the practices of the most innovative firms.

Design/methodology/approach – An internet based survey sent in winter 2008 to 494 medium-sized firms in four industries. The response rate was 77.3%. Sample was split into the best firms and the rest, and a best practice analysis was performed with correlation analysis.

Findings – The best firms focus on knowledge issues to a higher extent, while cost and geographical proximity are more important for the rest firms. The best firms prioritize knowledge integration and development of knowledge about the outsourcing process higher.

Research limitations/implications - The sample is taken from medium-sized Swedish manufacturing firms. Future samples need to be expanded to further generalize the conclusions. Results show that further research combining resource and cost perspectives are needed.

Practical implications – Managers are recommended to not only find access to needed knowledge, but also give time to integration on a personal level, as this protect knowledge and lower costs in the long run.

Originality/value – Studies of outsourcing NPD are few and, to our knowledge, no quantitative studies on the topic have been made.

Place, publisher, year, edition, pages
Bingley, UK: Emerald Group Publishing Limited, 2010. Vol. 13, no 1, p. 5-23
Keywords [en]
Outsourcing, NPD, Outsourcing of NPD
National Category
Other Mechanical Engineering
Identifiers
URN: urn:nbn:se:hh:diva-3042DOI: 10.1108/14601061011013203Scopus ID: 2-s2.0-74349099404OAI: oai:DiVA.org:hh-3042DiVA, id: diva2:240369
Available from: 2009-09-28 Created: 2009-09-28 Last updated: 2018-03-23Bibliographically approved
In thesis
1. Outsourcing and knowledge integration in new product development
Open this publication in new window or tab >>Outsourcing and knowledge integration in new product development
2009 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis deals with two aspects of knowledge needed for new product development; theaccess to external knowledge through outsourcing of NPD and the integration of knowledgedeveloped when outsourcing activities in the NPD process. As modern products competing onincreasingly international markets call for both complex and specialized knowledge, it isbecoming more important to take an outward perspective of knowledge, searching for externalknowledge sources, in order to be competitive. But it is also important for the firm to take aninward perspective on integration of the knowledge achieved from external sources in order tosecure the knowledge gained.

Outsourcing of New Product Development (NPD) refers to the outsourcing of activities fordeveloping new products (goods and/or service), where all or the innovative part of the NPDprocess is purchased externally according to a contract from organizational units separatefrom the outsourcing firm. This means that the service to develop a whole or a part of a newproduct is outsourced. This definition implies that (A) the outsourced activity shall be aninnovative (strongly contributing to the newness) part of the NPD process, (B) the outsourcedactivity was previously conducted internally, and (C) the activity shall be purchased andregulated in a contractual agreement between the organizations.

Knowledge integration refers to the process of acquiring, sharing, and making use ofknowledge by combining it with previous knowledge in order to create new value. Becauseknowledge possessed in collaborating firms is often complementary, it is important tocombine it with previous knowledge in the firm. Therefore knowledge integration is chosenthroughout the thesis as the term for the overall process.

Based on transaction costs theory, resource based and knowledge based perspectives twomajor issues are investigated. First, the identification of which factors are the most importantfor firms when making the decision to outsource activities in the NPD process. Second, theestablishment of the importance for knowledge integration of external knowledge in the firm,and to find what role level of involvement among staff plays for efficiently achievingknowledge integration.

The thesis is a compilation thesis (with six appended papers) based on findings from threequantitative studies and a longitudinal case study (presented in two of the appended papers).Using cases from and samples of medium-sized manufacturing firms with in-house NPD itwas found that, while cost has been traditionally considered the most important factor foroutsourcing in general, search for external knowledge is found to have a greater importancewhen intangible processes as NPD is object for outsourcing. It is also found that thematicknowledge is the most important type of knowledge to efficiently integrate to achieve highinnovation performance and that a higher degree of processes and culture supportinginvolvement, increase knowledge integration when outsourcing activities in the NPD process.

Place, publisher, year, edition, pages
Luleå: Luleå University of Technology, 2009. p. 294
Series
Doctoral thesis / Luleå University of Technology, ISSN 1402-1544
Keywords
outsourcing, new product development, knowledge integration
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
urn:nbn:se:hh:diva-3616 (URN)978-91-7439-036-0 (ISBN)
Public defence
2009-12-11, A117, Luleå, 12:30 (English)
Opponent
Supervisors
Available from: 2009-12-15 Created: 2009-12-13 Last updated: 2014-03-04Bibliographically approved

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Rundquist, JonasHalila, Fawzi

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