Gianni Lorenzoni

The leveraging of interfirm relationships as a distinctive organizational capability: a longitudinal study

In this paper we present a study of the structure of three lead firm‐network relationships at two points in time. Using data on companies in the packaging machine industry, we study the process of vertical disintegration and focus on the ability to coordinate competencies and combine knowledge across corporate boundaries. We argue that the capability to interact with other companies—which we call relational capability—accelerates the lead firm’s knowledge access and transfer with relevant effects on company growth and innovativeness. This study provides evidence that interfirm networks can be shaped and deliberately designed: over time managers develop a specialized supplier network and build a narrower and more competitive set of core competencies. The ability to integrate knowledge residing both inside and outside the firm’s boundaries emerges as a distinctive organizational capability. Our main goal is to contribute to the current discussion of cooperative ties and dynamic aspects of interfirm networks, adding new dimensions to resource‐based and knowledge‐based interpretations of company performance. Copyright

Constellations of firms and new ventures

Historically, firm growth has occurred when a firm generates revenues and increases production capabilities internally. An entirely different growth model is suggested, using cases in Italy, Europe, and the United States. Instead of increasing inputs, investments, and employees, these firms find new external-growth paths by integrating externally developed, tailor-made intermediate products or specialized services. These new paths for integration are referred to as constellations--which means that organizations do not survive as isolated and self-sufficient entities. The external-growth model is then tested using empirical evidence from studies conducted in the textile manufacturing area of Prato, Italy from 1977 to 1978. Area data provides two types of important indirect evidence. First, over time, the total productive capacity of Prato increased at the same time that there was a decline in the number of employees per unit. Second, contrary to the rest of Europe, textile employment in Prato remained constant and Prato maintained its international competitive position as a leader in both employment and marketshare. Since two barriers preventing a complete understanding of the new organizational configuration occurred with the limited case study, other experiences were used to test the model. Findings show that reliance upon external organizations was the condition of survival and growth of small firms. (SFL)

Resisting Organizational Inertia: The Evolution of Industrial Districts

Industrial district success in Italy is often explained as a function oftraditional, homogenous communities, where close social ties and communityinstitutions supposedly create the trust necessary for collaborativeinter-firm relationships among small firms. However, such a functionalistapproach fails to explain why some districts prosper over time bydeveloping new process and product innovations, while others stagnatebecause they fail to respond to rapidly changing markets. We argue thatgreater attention to firm networks – both those internal and external to the district – and the role of key firms represents a more usefulanalytical method for understanding the evolution and formation ofindustrial districts.

Process issues in international alliance management: A debate on the evolution of collaboration

Abstract This is an unusual paper in that it consists of a series of contributions by a group of scholars with different perspectives on the critical processes of cross-border alliance collaboration and management. We focus on a single longitudinal analysis of a large, and ultimately unsuccessful, joint venture between two experienced global companies: Coca-Cola and Nestle. Starting from this common database, the authors offer diverse and often contradictory interpretations of the same events and of the responses undertaken by both partners. By confronting these various perspectives, we try to build a more robust set of theoretical constructs regarding the role of initial conditions, equity, and efficiency on the collaborative process. Furthermore, we develop the concept of relational quality as a proxy for inter-organizational trust and offer the proposition that it may have a non-linear relation to alliance success. Finally, we condense all the arguments into a set of propositions regarding process issues in alliance management and offer some guidelines for future research in this field.

New Wines in New Bottles: The 'Renaissance' of the Italian Wine Industry

Abstract Unexpected events such as crises challenge organizations and actors who must search for solutions and alternatives. Severe crises can be fatal, especially when they affect entire industries. The ability to identify a viable course to address contingencies brought about by a crisis is critical to determining outcomes. In this paper, we examine the systemic response to a crisis at different levels within an industry in order to obtain a better understanding of industry responses to crises. Through a historical case study of the Italian wine industry renaissance, we show how a sudden and devastating crisis was circumvented to spur a renewed industry imbued with better practices and knowledge. Our findings also show the key role of preconditions in sustaining the renaissance.

The Fast Fashion Business Model

Fashion has a deep impact on the apparel industry and is used as a lever to gain a competitive advance position. The original idea of the fast fashion firm consists in offering fashionable products at cheap or very cheap prices. The fast fashion players try to capture the trends as opposed to imposing the trends, and simultaneously to reduce the risks of betting the future staying close to the “proof of the market” and be flexible to jump in as soon as signals become stronger and more reliable, therefore they are not incurring in the market risk of unmatched demand or, at least, strongly erase them.