IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v33y1987i2p178-197.html
   My bibliography  Save this article

The Effect of Business Interdependencies on Product R&D-Intensive Business Performance

Author

Listed:
  • Mel Horwitch

    (Massachusetts Institute of Technology, Sloan School of Management, 50 Memorial Drive, Cambridge, Massachusetts 02139)

  • Raymond A. Thietart

    (University of Paris and ESSEC, Ecole Superieure des Sciences Economiques et Commerciales, Avenue de la Grande Ecole, B.P. 105, 95021 Cergy Pontoise Cedex, France)

Abstract

One of the major decisions that firms face regarding R&D-intensive businesses is a structural one: establishing the appropriate level of internal strategic interdependency within and among business units. The current discussion over the effectiveness of creating small, independent, and entrepreneurial venture units in multi-business corporations is part of this larger structural concern. The aim of the present research is to study the efficacy of different structural linkages for achieving market share and ROI objectives in product R&D-intensive businesses. The study focuses on interdependencies between business units in product R&D-intensive businesses that produce consumer products or industrial products. A sample of 641 businesses (221 consumer products and 420 industrial goods) is drawn from the PIMS data base. A cluster analysis is run to identify natural groups of homogeneous businesses. For each of the seven identified groups (established suppliers, fast movers, high-tech job shops, stalled giants, established diversifiers, dominant specialists, and laggers) a multi-way analysis of variance is performed to study the influence of various interdependencies measured in term of vertical integration, shared facilities, and shared marketing on two criteria of performance: market share and ROI. The findings indicate, first, that the interdependencies required to achieve high performance are contingent upon the nature of the product R&D-intensive business and its environmental characteristics. Second, for a given business configuration, high performance interdependencies are influenced by the type of performance objectives selected by the business, such as market share or profitability. Finally, the results imply that a multi-business corporation which possesses a portfolio of product R&D-intensive businesses probably requires a more diverse set of interdependencies than, for example, simply mainstream centralized industrial R&D organization, on the one hand, and independent entrepreneurial units on the other hand. Effective competition for a firm with diverse R&D-intensive businesses may often call for a capability to support concurrently multiple levels of internal interdependencies and to reject, create, or modify this set of interdependencies as the situation warrants.

Suggested Citation

  • Mel Horwitch & Raymond A. Thietart, 1987. "The Effect of Business Interdependencies on Product R&D-Intensive Business Performance," Management Science, INFORMS, vol. 33(2), pages 178-197, February.
    • Handle: RePEc:inm:ormnsc:v:33:y:1987:i:2:p:178-197
    DOI: 10.1287/mnsc.33.2.178
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mnsc.33.2.178
    Download Restriction: no
    File URL: https://libkey.io/10.1287/mnsc.33.2.178?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Victoria L. Mitchell & Barrie R. Nault, 2007. "Cooperative Planning, Uncertainty, and Managerial Control in Concurrent Design," Management Science, INFORMS, vol. 53(3), pages 375-389, March.
    2. Meeta Dasgupta & R.K. Gupta & A. Sahay, 2011. "Linking Technological Innovation, Technology Strategy and Organizational Factors," Global Business Review, International Management Institute, vol. 12(2), pages 257-277, June.
    3. Scott A. Shane & Karl T. Ulrich, 2004. "50th Anniversary Article: Technological Innovation, Product Development, and Entrepreneurship in Management Science," Management Science, INFORMS, vol. 50(2), pages 133-144, February.
    4. Shin-Liang Chan & Wann-Ming Wey & Pin-Huai Chang, 2014. "Establishing Disaster Resilience Indicators for Tan-sui River Basin in Taiwan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 115(1), pages 387-418, January.
    5. Daniel McFadden, 2008. "Semiparametric analysis (in Russian)," Quantile, Quantile, issue 5, pages 29-40, September.
    6. Bantel, Karen A., 1998. "Technology-based, "adolescent" firm configurations: strategy identification, context, and performance," Journal of Business Venturing, Elsevier, vol. 13(3), pages 205-230, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:33:y:1987:i:2:p:178-197. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.