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Modularity, interfaces definition and the integration of external sources of innovation in the automotive industry

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  • Cabigiosu, Anna
  • Zirpoli, Francesco
  • Camuffo, Arnaldo

Abstract

In the last two decades, the auto industry has shown a steady increase of vehicle development outsourcing and a shift of both product development tasks and knowledge from carmakers to suppliers. This trend has increased the interest toward product modularity as a tool to ease the integration of external sources of innovation but there is contradictory evidence concerning the benefits of modularity in inter-firm coordination in the automotive industry. Moreover, although modularity literature considers standard interfaces one of the constitutive elements of modularity and a means for easing design outsourcing, very few studies have analyzed the genesis and the micro-dynamics of the interfaces definition process. In order to fill this research gap, this paper focuses on how assemblers and suppliers define the component-vehicle interfaces in component co-development projects. This study adopts a “quasi-experimental design approach” comparing two similar vehicle component co-development projects carried out by the same first-tier supplier with two different automakers. Under the ceteris paribus conditions defined by the research design, the empirical evidence derived from the analysis of the two projects shows that, differently from what modularity theory claims: the interface definition process is neither technologically determined nor the mere result of product architectural choices; the OEMs and the supplier's capabilities, degree of vertical integration, knowledge and strategic focus drive the partitioning of the design and engineering tasks, the interfaces definition process, and the choice of the inter-firm coordination mechanisms. Furthermore, while component modularity and design outsourcing are considered as complements in modularity literature, our findings suggest that they may work as substitutes and are rather difficult to combine.

Suggested Citation

  • Cabigiosu, Anna & Zirpoli, Francesco & Camuffo, Arnaldo, 2013. "Modularity, interfaces definition and the integration of external sources of innovation in the automotive industry," Research Policy, Elsevier, vol. 42(3), pages 662-675.
  • Handle: RePEc:eee:respol:v:42:y:2013:i:3:p:662-675
    DOI: 10.1016/j.respol.2012.09.002
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Anna Cabigiosu, 2018. "When do modular dominant designs emerge? A theoretical framework," Working Papers 05, Department of Management, Università Ca' Foscari Venezia.
    2. Frigant, Vincent & Zumpe, Martin, 2014. "The persistent heterogeneity of trade patterns: A comparison of four European Automotive Global Production Networks," MPRA Paper 60199, University Library of Munich, Germany.
    3. Battke, Benedikt & Schmidt, Tobias S. & Stollenwerk, Stephan & Hoffmann, Volker H., 2016. "Internal or external spillovers—Which kind of knowledge is more likely to flow within or across technologies," Research Policy, Elsevier, vol. 45(1), pages 27-41.
    4. repec:eee:iburev:v:27:y:2018:i:4:p:852-866 is not listed on IDEAS
    5. Dechezleprêtre, Antoine & Neumayer, Eric & Perkins, Richard, 2015. "Environmental regulation and the cross-border diffusion of new technology: Evidence from automobile patents," Research Policy, Elsevier, vol. 44(1), pages 244-257.
    6. repec:eee:proeco:v:193:y:2017:i:c:p:677-690 is not listed on IDEAS
    7. Morita, Hodaka & Nakajima, Kentaro & Tsuru, Tsuyoshi, 2017. "Product Architecture and Intra-Firm Coordination: Theory and Evidence," Discussion Paper Series 659, Institute of Economic Research, Hitotsubashi University.
    8. Vincent FRIGANT & Martin ZUMPE, 2014. "Are automotive Global Production Networks becoming more global? Comparison of regional and global integration processes based on auto parts trade data," Cahiers du GREThA 2014-09, Groupe de Recherche en Economie Théorique et Appliquée.
    9. repec:eee:techno:v:70-71:y:2018:i::p:33-45 is not listed on IDEAS
    10. repec:spr:gjofsm:v:19:y:2018:i:2:d:10.1007_s40171-017-0177-1 is not listed on IDEAS
    11. Arash Najmaei, 2016. "Revisiting The Modularity-Performance Nexus: Business Model Innovation As A Missing Mechanism," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(07), pages 1-41, October.
    12. Stefano Elia & Rajneesh Narula & Silvia Massini, 2015. "Disentangling the Role of Modularity and Bandwidth in Entry Mode Choice: The Case of Business Services Offshoring," John H Dunning Centre for International Business Discussion Papers jhd-dp2015-06, Henley Business School, Reading University.
    13. repec:ibn:ibrjnl:v:11:y:2018:i:7:p:142-151 is not listed on IDEAS
    14. Claussen, Jörg & Essling, Christian & Kretschmer, Tobias, 2015. "When less can be more – Setting technology levels in complementary goods markets," Research Policy, Elsevier, vol. 44(2), pages 328-339.

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