Francesco Zirpoli

Organizing new product development: Knowledge hollowing‐out and knowledge integration – the FIAT Auto case

The paper analyses the organization of the new product development process at FIAT from a resource‐based perspective. The focus is on organizational resources for integrating dispersed specialist knowledge required in the development of complex products. The analysis shows how the application of a resource‐based perspective is able to uncover negative long‐term effects of outsourcing on the knowledge base (hollowing out), despite beneficial short‐term effects on cost.

The nature of buyer‐supplier relationships in co‐design activities: The Italian auto industry case

The nature of buyer‐supplier relationships has been closely linked to nation specific explanations and concern has been expressed in literature regarding the transferability of co‐design best practices to different firms and countries. On the other hand, many attempts to isolate best practices and to apply them on a global scale have been proposed in the literature. Contributes to the issue by analysing a controversial case study based on the Italian automotive industry. Results show that few aspects of the Japanese contextual features and American ones existed when the major Italian car maker decided to outsource component design and dramatically change its supply chain management approach. Moreover, despite the massive involvement of suppliers at a very early stage of the car maker new product development process, not all the best practices deemed to be necessary when implementing a co‐operative buyer‐supplier relationship have been applied. Argues that these results lead us to question the very nature of effective buyer‐supplier relationships as described by the dominant literature and suggests implications for practitioners and for future research.

The limits of design and engineering outsourcing: performance integration and the unfulfilled promises of modularity

Outsourcing design and engineering tasks in product development is increasingly popular. However, firms that outsource design and engineering tasks often experience problems. So far, no satisfactory answer exists regarding the question to what extent design and engineering tasks can be outsourced before negative consequences occur. We address this gap. This paper identifies the limits of design and engineering outsourcing in product development, and the sources of these limits. To do so, it investigates the organizational challenges that a major European automotive manufacturer faced when it decided to adopt an extreme form of design and engineering outsourcing. Based on an in-depth case study, we identify the sources of problems with outsourcing design and engineering tasks in product development, and shed light on the limits of design and engineering outsourcing in product development.

Supplier involvement in automotive component design: outsourcing strategies and supply chain management

In this paper, the analysis is drawn on the motivations, modalities and consequences of supplier involvement in automotive component design. Outsourcing decisions affect the set of core competencies of buyer and supplier and, given certain circumstances, induce a migration of competencies from OEMs to suppliers. An in-depth exploratory multiple case study on a major European car maker and two of its suppliers revealed that this migration of competencies should not threaten the leadership of car makers within the supply chain if it is associated with: (1) a strong competence of the car maker as system integrator and (2) a new way of conceiving supply chain management.

Innovation Routines: Exploring the Role of Procedures and Stable Behaviour Patterns in Innovation

This book showcases advanced empirical research that applies the concept of organizational routines to understanding organizations and how they change and evolve.

The Network Firm as a Political Coalition

The article uses a qualitative case study of fifteen years in the production network that revolves about Fiat Auto to depict the “network firm” as a political coalition. The analysis touches on Fiat’s radical outsourcing of production in the 1990s, a short-lived and ill-fated alliance with General Motors in 2001, a descent to the brink of bankruptcy in 2004, a return to profitability by 2007, and, finally, the acquisition of control of Chrysler in 2009. The article reconstructs James March’s classic Carnegie model of the firm in light of the blurring of organizational boundaries. By marrying that model with ideas drawn from the literatures on organizational networks, social movements, and organizational politics, the article demonstrates that strategic decision-making at Fiat and at key suppliers shaped, and was shaped by, an interplay of frames and relational embedding within and across organizational boundaries. This shows how coalitional politics shape and are shaped by the shifting boundaries of the firm, and how those politics affect the evolution of the production networks that prevail across many contemporary industries.

Knowledge integration in new product development: the FIAT Autocase

The article analyses the organisation of the new product development process at FIAT Auto with a particular focus on knowledge used in this process. The knowledge dimension emerges as important in the new product development process in particular because of the outsourcing of design tasks. Such outsourcing not only solves the problems of cutting costs and reducing lead times, but also raises the problem that the knowledge required in the new product development process is spread more widely across the supply chain. Subsequently, it needs to be (re-)integrated and coordinated in order to make for a whole. How do car makers go about organising the integration and co-ordination of knowledge required in the new product development process, reinforced by strong outsourcing? The article casts some light on this question from the case of FIAT Auto, reporting insights from a longitudinal study that spans the years 1991–2002.

A Dynamic Theory of Network Failure: The Case of the Venice Film Festival and the Local Hospitality System

Organizational and sociological research dealing with network governance has mainly focused on network advantages rather than on their problems or dysfunctionalities. This focus has left the field of network failure partially unexplored. We argue that although there have been some attempts to explicitly theorize network failures, the existing explanations, which are based on structural or social conditions, are not exhaustive. In this article we report the results of our empirical investigation on an underperforming network formed by the world-famous Venice Film Festival and its local hospitality system. We inductively derive a dynamic theory of network failure premised on the interplay of the network’s static dimensions (opportunism and ignorance) and dynamic dimensions (framing and mobilizing), and the role of institutions.

A new organisation for supplier involvement in vehicle design: the Italian automotive industry case

This paper concerns the organisational solutions that best match the need to manage the new product development process in a context of the growing pace of new product introduction, high product variety and complexity, and strong supplier involvement in automotive component design. A very recent organisational structure for new product development at Fiat Auto, a global car manufacturer, will be presented and discussed in the light of recent literature. Strategies based on a major supplier involvement in design seem to benefit from the so-called extended platform organisation, and from the centralisation of component design responsibilities in a newly created organisational unit. This latter facilitates supplier involvement at the concept stage of development and, at the same time, allows the leverage of components and systems technology across models. This setting provides a valid counteraction against some pitfalls of the traditional platform based structure, in which the involvement of suppliers at the concept stage is often too idiosyncratic to the specific model under development, incurring diseconomies of scale and scope.

How to Avoid Innovation Competence Loss in R&D Outsourcing

Companies developing complex products face a crucial dilemma: the benefits of research and development (R&D) outsourcing such as lower costs, access to specialist knowledge, or shorter development lead times often have negative consequences for competence development due to the loss of opportunities for learning by doing. Having experienced the problems of outsourcing R&D, Fiat developed a novel organizational solution that offers new insights as to how firms can organize R&D to protect against innovation competence loss in R&D outsourcing.