Giovanni Valentini

The consignment stock of inventories: industrial case and performance analysis

The ‘‘Consignment Stock’’ technique is a novel approach to the management of inventories in supply chains. It is based on an improved collaboration between the company and its suppliers, one that is acquiring growing importance in industrial environments, as the authors have found in Italy. The main aim of the present work is to describe the technique itself, thus underlining its potential benefits and pitfalls. The case proposed refers to a company manufacturing components for the automotive industry. Essentially, the company offered its suppliers the opportunity of stocking part of the items in its own warehouses, with the agreement that they would guarantee over time an inventory level between a set minimum and a maximum value. r 2002 Elsevier Science B.V. All rights reserved.

Strategic organization of R&D: the choice of basicness and openness

Through a stylized model of the R&D process, this article shows how the strategic organization of R&D should simultaneously consider the choice of the type of R&D to be performed (basicness) and the organization of R&D, which includes the choice about the exposure of the R&D project to knowledge from outside the firm (openness).The authors identify how each of these decisions affects the expected benefits and costs (production, transaction and coordination costs) of R&D projects, and formally derive how these decisions interact.The fact that these decisions are customarily allocated to different agents with misaligned objectives pushes top management to strategically adjust the R&D strategy (i.e. the type of R&D performed) in order to affect the organization of the R&D project, an often times decentralized decision taken by a project manager. From the model, the authors develop several implications for theory, explain some observed empirical regularities in the management of R&D and derive novel testable implications.

M&A and the profile of inventive activity

This article examines the effect of mergers and acquisitions (M&A) on the profile of merging firms’ inventive activity. The authors conceive of the inventive process as a recombinant search, whose outcome can be characterized along two complementary dimensions, which define its profile: its depth of impact on subsequent inventions, and its breadth of impact across different scientific domains. The profile of firms’ inventive activity depends on two main factors: the resources available to be recombined and the organizational incentives that guide the recombination process. In turn, these factors significantly depend on the upstream, technological resources available and on firms’ downstream, product-market related assets. Importantly, both of these factors may change in the aftermath of M&A, as their specific institutional features facilitate the exchange and redeployment of upstream and downstream resources. The authors then discuss how variations in the profile of firms’ inventive activity in the aftermath of an M&A reflect the diversity of upstream and downstream resources redeployed by the M&A deal. They test their hypotheses with a panel of firms from the US medical devices and photographic equipment industry. The study finds that diversity in merging firms’ downstream resources exerts a positive impact on post-acquisition profile of inventive activities, whereas diversity in knowledge bases does not seem to exert a significant direct effect on the two qualitative dimensions of inventive activity considered. Yet, technological diversity displays a positive effect in deals characterized by high market relatedness.

Organizing for Innovation: R&D Projects, Activities and Partners

We explore how R&D project characteristics condition the governance of an R&D project and its individual activities. Prior literature has tried to understand the factors - both at the industry and at the firm level - that influence the way in which firms partner for innovation. In this paper, through the analysis of detailed data from a subsidiary of STMicroelectronics, we identify the main drivers of partner selection for innovation. Partnering or contracting with universities for innovation is common practice for developing new -original- knowledge, as opposed to applying existing knowledge to a problem. But firms are more reluctant to partner, especially with other firms, when that knowledge directly enhances their competitiveness. However, conditional on cooperation, partners are more likely to act individually when the project is strategically important. Contracting for innovation to universities or research centers, as opposed to partnering, happens for more experimental projects, where highly original knowledge is developed, and typically early on in the project.

The Organization and Performance Evaluation of R&D Projects in a Dynamic Environment

Faster technological development, shorter product life-cycles, and more intense global competition have transformed the current competitive environment for most firms. This new competitive landscape forces organizations to actively acquire knowledge, as a firms competitive advantage is now more dependent on continuous knowledge development and enhancement. Therefore, knowledge has become a central theme in strategic management. Against this background, we argue that the knowledge characteristics of R&D projects are fundamental variables to explain governance decisions. Drawing upon the case of STMicroelectronics, we provide evidence that partnering or contracting with universities for innovation is common practice for developing new -original- knowledge, as opposed to applying existing knowledge, for solving a problem. However, the firm is more reluctant to partner, especially with another firm, when this knowledge directly enhances its competitiveness. Moreover, we find that R&D project performance is a bi-dimensional construct. One dimension picks up project efficacy and immediate benefits, while the other includes learning and long-term benefits. Though spanning firm boundaries for innovation does not seem to have appreciable effects on perceived project efficiency, it nonetheless brings about intertemporal benefits related to learning and capabilities development. In a dynamic environment, building knowledge may be more important than protecting it. Thus, an open innovation process may be an exceptionally effective way to build and develop the firms technological future.

Managing Stocks in Supply Chains: Modeling and Issues

The paper presents a policy for inventory management in simple supply chains consisting of one buyer and a single vendor. The method is based on consignment stocks. A model is developed and a performance satisfaction indicator is introduced. In its development, the Consignment Stock model considers the uncertainty stemming from demand fluctuation and the unpredictability of lead times. Experiments were conducted to compare the performance of the Consignment Stock policy to some of those existing in literature.

Bribery and its Firm-Level Outcomes in Africa and Latin America

Does paying bribes buy influence rents? While a lot is known about the antecedents and consequences of legal influence strategies, we know little about the drivers and consequences of illegal influ...

Design Combination Potential and Get it Done: An Analysis of the Drivers of Technological Performance in Mergers and Acquisitions

The paper explores the impact of mergers and acquisitions (M&As) on technological performance. We posit that the post‐acquisition technological performance is positively related to the technological combination potential of the merging firms and to their ability to realize this potential. In turn, the combination potential depends on M&As motives aimed at complementing firms’ technological resources, whereas firms’ ability to realize their potential is significantly influenced by their prior experience in M&As and technology integration.

Discrimination and Entrepreneurship: Evidence from LGBT Rights Laws

This study revisits the well-established claim that reducing discrimination spurs entrepreneurial entry. We propose that the effect of antidiscrimination initiatives on entrepreneurship depends crucially on whether discrimination originates on the demand- or the supply-side of the entrepreneurial process. The benefits of antidiscrimination practices in the context of entry are based on the study of the demand-side discrimination, or bias which arises when prospective entrepreneurs face discrimination by key resource providers for a new venture (i.e., investors, banks, prospective employers). We hypothesize the opposite effect on the supply-side, or when prospective entrepreneurs face discrimination in paid employment. Using evidence from the enactment of LGBT antidiscrimination policies, we show that initiatives to reduce employer discrimination deter entry into entrepreneurship because they increase the appeal of paid employment relative to entrepreneurship. Despite the reduction in the rates of entrepre...

Super Partes? Assessing the Effect of Judicial Independence on Entry

Incumbents can enjoy a cost advantage vis-a-vis new entrants and so deter new firm entry by establishing and leveraging connections with the judicial system. Connected firms may in fact avoid fully complying with the costly norms implied by a law, a regulation, or a contract. At the same time, they can also credibly threaten to sue new entrants. Therefore, a change in the institutional environment that diminishes the ability of incumbent firms to establish judicial connections—i.e., an increase in judicial independence—can promote entrepreneurship. Exploiting reforms that change the way in which U.S. state judges are selected, we confirm that this is the case, and we show that this effect is more salient in states and industries where the likelihood of entering into a business dispute is higher. The paper also sheds some light on the mechanisms behind this effect. Data and the online appendix are available at https://doi.org/10.1287/mnsc.2017.2794. This paper was accepted by Toby Stuart, entrepreneurship ...