The Lead Factory Concept: Benefiting from an Efficient Knowledge Transfer
AbstractThis paper analyses the effectiveness of knowledge transfer between research and development (R&D) and intra-firm production units. Specifically, two distinct network structures are compared: the lead factory concept and traditional networks of R&D and production. Based on an analytical two-stage decision model for prototype and serial production, we highlight relevant factors that determine the relative advantages and disadvantages of the lead factory concept in comparison to a traditional network structure. In particular, the lead factory concept is more cost-efficient than the traditional network if there are a high number of production plants, the adaptation costs for implementing the transferred prototype from the lead factory to the plant are low, the manufacturing costs for the prototype are high, and the manufacturing processes are not highly specific or knowledge intensive.
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Bibliographic InfoPaper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Working Papers with number 0127.
Length: 25 pages
Date of creation: May 2010
Date of revision:
Operations Management; Manufacturing; Lead Factory; Knowledge Transfer; Cost Benefit Analysis;
Find related papers by JEL classification:
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- M11 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Production Management
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-05-15 (All new papers)
- NEP-CSE-2010-05-15 (Economics of Strategic Management)
- NEP-IPR-2010-05-15 (Intellectual Property Rights)
- NEP-KNM-2010-05-15 (Knowledge Management & Knowledge Economy)
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- Patricia Deflorin & Helmut M. Dietl & Markus Lang & Eric Lucas, 2011.
"Determinants of the Optimal Network Configuration and the Implications for Coordination,"
314, University of Zurich, Department of Business Administration (IBW).
- Patricia Deflorin & Helmut Dietl & Markus Lang & Eric Lucas, 2011. "Determinants of the Optimal Network Configuration and the Implications for Coordination," Working Papers 0152, University of Zurich, Institute for Strategy and Business Economics (ISU).
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