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The Effect Of Industry Clockspeed On Make-Buy Decisions In The Face Of Radical Innovations: An Empirical Test

Author

Listed:
  • ROBERT K. PERRONS

    (Shell International Exploration & Production B.V., Kesslerpark 1, 2288 GS Rijswijk, The Netherlands)

  • MATTHEW G. RICHARDS

    (Department of Aeronautics & Astronautics, Massachusetts Institute of Technology, 77 Massachusetts Avenue, Cambridge MA 02139, USA)

  • KEN PLATTS

    (University of Cambridge, Institute for Manufacturing, Mill Lane, Cambridge, CB2 1RX, United Kingdom)

Abstract

Evidence from management and business strategy research is divided over whether or not a firm should outsource the components and processes underpinning a new and potentially radical innovation. This investigation introduces ideas and evidence from the areas of supplier relations and industry clockspeed, and attempts to reconcile conflicting conclusions from earlier research by using a survey to measure supply chain management practices from a broad range of manufacturers in the UK. The results show that an industry's clockspeed has no significant bearing on the success or failure of any particular make-buy strategy for a radical innovation. The findings also indicate that maintaining strong ties with suppliers yields no significant long-term benefit for firms contending with radical new technologies.

Suggested Citation

  • Robert K. Perrons & Matthew G. Richards & Ken Platts, 2004. "The Effect Of Industry Clockspeed On Make-Buy Decisions In The Face Of Radical Innovations: An Empirical Test," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 8(04), pages 431-454.
    • Handle: RePEc:wsi:ijimxx:v:08:y:2004:i:04:n:s1363919604001131
    DOI: 10.1142/S1363919604001131
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    References listed on IDEAS

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    1. Williamson, Oliver E. & Winter, Sidney G. (ed.), 1993. "The Nature of the Firm: Origins, Evolution, and Development," OUP Catalogue, Oxford University Press, number 9780195083569.
    2. Fine, Charles H. & Whitney, Daniel E., 1996. "Is the make-buy decision process a core competence?," Working papers #140-96. Working paper (S, Massachusetts Institute of Technology (MIT), Sloan School of Management.
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