Making supplier innovation success more certain: evaluating, selecting and embedding supplier innovations
Due to the COVID-19 crisis the PhD defence of Janina Goldberg will take place online (until further notice).
The PhD defence can be followed by a live stream.
Janina Goldberg is a PhD student in the research group Entrepreneurship/Technology/Management (ETM). Her supervisor is prof.dr. H. Schiele from the Faculty of Behavioural, Management and Social Sciences (BMS).
Innovations are central sources of competitive advantage, and effective innovation management processes are crucial to ensure that organizations survive and prosper. Simultaneously most innovations are no longer developed internally at the buying company but are provided and invented by suppliers. This supplier involvement increases the number of innovations and the innovation project success at buying companies but also carries significant risks due to the high level of supplier dependence. Regardless of whether an innovation is developed internally or provided from or co-developed with a supplier, a very high percentage of all new product development (NPD) projects fail. As innovation success is uncertain or even unpredictable, managing innovations effectively is a tremendous challenge for most companies.
Prior research shows two main reasons for this high failure rate: (1) Bad innovation ideas are selected, and probably good innovation ideas are not selected due to insufficient or even no innovation project evaluation and selection and (2) inadequate and slow innovation project execution caused by bad project execution performance of the supplier or/and the buying company. These two circumstances, combined with the fact that existing innovation management approaches mostly focus on internally generated innovations and neglect the supplier as the most critical source of innovation - form the two research gaps this dissertation aims to close. The first gap is that no ready-to-use tool for evaluation and selection of supplier innovations is available. The second gap consists of the fact that implementing a supplier innovation is poorly executed and takes too long.
To sum up this dissertation's major contributions, first, nine evaluation criteria for supplier innovations (five to evaluate the innovation idea and four to evaluate the innovative supplier) are developed. Furthermore, the supplier evaluation criteria (‘innovation management’, ‘endurance’, ‘preferential treatment’, and ‘personnel of the supplier’) and the innovation idea evaluation criteria (‘market potential’, ‘influence on the business model’, ‘customer acceptance’, ‘cost/benefit analysis’, and ‘proof of concept’) have been tested and empirically validated in a quantitative survey. Secondly, this dissertation provides a method, consisting of two tools, to execute the evaluation and selection of supplier innovations. The nine evaluation criteria are arranged into two operationally usable checklists, which can be combined into one scoring model, which assesses the innovation idea from two sides – the idea quality and the supplier quality. Moreover, as a second tool, a matrix is provided that visualizes the evaluation scores and can be used to execute the selection decision.
Finally, this dissertation contributes to optimizing the innovation project execution and implementation of supplier innovations. On the one hand, by providing suggestions for optimizing the innovation implementation process in context with supplier innovations and on the other hand through introducing a new promotor team of three promotors, which are specifically tailored to execute supplier innovations. Concerning the process optimizations, it is suggested to endeavor to receive preferred customer status from an innovative supplier, to establish a fast track process for innovation implementation (besides the standard project execution process), and to install a supplier constellation and preferred customer status check-up, and to decide afterward which path to follow (the standard or the fast track one). Regarding the innovation promotors, the need to expand and empower the established promotor theory in the firm's external environment is revealed, and three newly designed promotors for supplier innovations are introduced. The three newly developed promotors are the supplier vision promotor, the diplomatic promotor, and the customer promotor. Additionally, it is concluded to use the different promotor teams adapted to different kinds of innovations: the classic promotor team (power, expert, process, and relationship promotors) for internally generated innovations and the newly developed promotor team for innovations provided by suppliers.