On the relationship between supplier integration and time‐to‐market

Abstract

Recent operations management and innovation management research emphasizes the importance of supplier integration. However, the empirical results as to the relationship between supplier integration and time‐to‐market are ambivalent. To understand this important relationship, we incorporate two major recent developments. First, the literature has started to redefine supplier integration into two dimensions, supplier product integration and supplier process integration. Second, recent research has begun to examine spillover effects that extend beyond the direct costs and benefits of the supplier contract. Using survey data of 116 firms in the industrials, health care, and information technology industries, the results confirm our hypotheses and show that supplier product integration decelerates time‐to‐market while supplier process integration accelerates time‐to‐market. The results also show a positive relationship between supplier integration and the adoption of external technologies, which either decelerates or accelerates time‐to‐market depending on the level of internal exploration activities. Our research, thus, helps to open the ‘black‐box’ of the relationship between supplier integration and time‐to‐market, and provides a theoretically grounded explanation to the apparent contradictory results in prior research about the influence of supplier integration on time‐to‐market. In addition, we contribute to research on spillover effects by emphasizing that information technology adoption and assimilation is an important spillover effect of supplier integration.

The impact of global purchasing and supplier integration on product innovation

“…Wynstra et al, 2003;Schiele, 2010), but that companies purchasing locally fail to reap the benefits is more surprising. That supplier integration is associated with shorter TTM has also been well documented by previous empirical studies (Lau et al, 2010;Schiele, 2010;Perols et al, 2013). The surprise is again that this association is only valid for firms purchasing globally.…”

“…Other studies have also found that supplier integration is required for harnessing the innovation potential of new suppliers when outsourcing manufacturing (Bengtsson et al, 2009). Perols et al (2013) found that supplier integration in NPD is effective for improvements in TTM. Other studies have found that logistics-related integration has an impact on company performance, including product innovation (Flynn et al, 2010;Prajogo and Olhager, 2012).…”

Quality management and innovation: new insights on a structural contingency framework

“…In order to assess goodness of fit Tenenhaus et al [83] proposes assessing R 2 with a suggested cut-off value of 0.36 [84]. Our model exceeds the rigid cut-off with an R 2 value of 0.46.…”

The knowledge transfer process in Six Sigma subsidiary firms

“…Although our sample size is not large enough to use these approaches, PLS is especially suitable for studies with small sample size (Benitez-Amado and Walczuch, 2012;Chin et al, 2003) and consequently more appropriate for our study. Operations management journals have recently incorporated this approach in their publications (Lockstrom and Lei, 2013;Mackelprang, Jayaram and Xu, 2012;Perols, Zimmermann and Kortmann, 2013;Sawhney, 2013). Mackelprang et al (2012) give a detailed explanation of PLS usage in cases of operations management publications.…”