Phase 3: a new pattern toward in-sourcing (2002-2006)144
Organizational aspects of system integration145
The scope of the knowledge base145
The organization of NPD147
Discussion152
Incomplete decomposability of product performance and its consequences153
The limits of leveraging modular product architecture for achieving coordination154
Component-specific knowledge and architectural knowledge157
Implications for firm boundaries161
The role of organizational decisions on limits of outsourcing163
Case Study166
Introduction166
The link between offshoring and firm performance168
Data description176
The impact of offshoring on firm performance181
REFERENCES191
CHAPTER 1: INTRODUCTION
Background
Outsourcing design and engineering tasks in product development is increasingly popular. From the early nineties, the innovation literature promoted involving suppliers in product development, emphasizing that they could play a key role in successfully developing complex products (Womack et al., 1990; Clark and Fujimoto, 1991; Wheelwright and Clark, 1992). The focus of attention of this research was on the development practices of Japanese firms, whose success in terms of product development was seen in large part due to the heavy involvement of suppliers in the new product development process (henceforth 'NPD') (Clark, 1989; Nishiguchi, 1994; Bensaou, 1999). Considered best practices (Imai et al., 1985), they became models, which were imitated by Western firms (Womack et al., 1990), and the object of study of early supplier involvement ('ESI') (Helper, 1991; Smitka, 1991; Lamming, 1993; Nishiguchi, 1994; Helper and Sako, 1995; Sako, 2004).
In many complex product industries, pressures for involving external sources of innovation have increased due to changes in external conditions (Sturgeon, 2002); the evolution of markets for technology and technological development services (Arora et al., 2001) has resulted in a generalized tendency toward vertical disintegration, modularization, outsourcing, and networking in product development (Langlois, 2002; Chesbrough and Crowther, 2006; Howells et al., 2008). It is very difficult for one individual firm to master all the knowledge ...