MANAGEMENT

Innovation Management



Innovation Management

Introduction

Due to rapid changes in the business environment and competitiveness, organizations have to be innovative to survive in the marketplace. Many firms have applied knowledge management to reduce production costs and launch new products to strengthen their business. Hence, Companies' management has to maintain competitive advantage by providing inputs through a dynamic supplier network. Supplier development programs help businesses to identify collaborative suppliers.

Therefore, Supplier Knowledge Management plays a pivotal role for firms to create switching costs and raise barriers to entry. In this paper, we demonstrate how companies can benefit and be innovative by supplier management. This paper also examines the ways in which Toyota succeeded in establishing and managing a high-performance information-sharing with suppliers.

Discussion

For most firms and organizations, innovation is a trademark conducted mostly inside the business in a series of diligently managed pace (Ahmadjian, Lincoln, 2001, 683). Over the past years, however, a slight number of consumer-oriented businesses have shifted towards product development with emerging ideas and have tilted towards more open innovation. Now days, companies are looking at methods to give more of the control of innovation to networks of suppliers with the aim of getting better concepts and designs for new products, and to advance those designs speedily and economically.

Managing supplier and manufacturer relationship is important and it is significant to have supplier development. The levels of maintenance shift by the manufacturer, and improvement and update the competencies of supplier are the basic elements of supplier development. The Maintenance ability could be defined as maintaining and sustaining the levels of performance provided. For instance, the suppliers of Toyota are aware of the standards that are followed in the Toyota Manufacturing Unit. Improvement ability is the process in which if the standards and work process are not complying with the approaches it will refine all the processes to comply with the work approaches. Hence, the maintenance and improvement abilities are very closely linked (Chesbrough, Garman, 2009, 70).

The New Face of Innovation

The new tool of Knowledge sharing with the Suppliers network is an indispensable in increasing a company's competitive advantage. It is increasingly taking place between organizations. Certainly, Japan's firm supplier networks, specifically in the automotive and electronics sectors and strong supplier relations are accredited with empowering Japanese auto assemblers to stay flexible though profiting from a level of control over the organizations.

Additionally, profound levels of trust and long-term cooperation between manufacturers and their suppliers have considerable declines in product development time. Absolutely, the durable trust and understanding existing in Japanese companies and supplier networks plays a significant part in information sharing (Sobrero, Roberts, 2001, 494).

Toyota has prospered in making a dense network with a solid identity and cooperative information-sharing routines with its suppliers' network. Such a robust network philosophy and strong cooperative ties among manufacturers and suppliers enable the unified flow of smooth implicit information between individual firms (Dyer, Hatch, 2004, 58). On the other hand, these strong ties can also lead to undesirable network closure and greater risk ...