In pursuit of control: involving suppliers of critical technologies in new product development

The purpose of this paper is to explore the dynamics of management and control in collaborations with suppliers of critical technology.

Three collaborative product development projects at a system integrator in the telecom industry were studied. The data was collected through 22 semi-structured interviews and a workshop at the studied company and its suppliers.

The paper shows that in situations of high dependence on suppliers of critical technologies, control may be pursued by complementing black-box development with appropriate checks and balances in the collaboration, i.e. using combinations of control mechanisms, disconnected development and joint problem solving, contracts and trust, and alignment efforts on project and strategic levels. Further, the paper demonstrates that this involves several trade-offs related to the advantages of increased monitoring and disadvantages of decreased levels of freedom for the supplier and consequently decreased prerequisites for supplier creativity.

The qualitative approach of the research limits generalizability. Our study is limited to three projects at one firm.

Technological roadmaps can be used as an important tool to facilitate alignment with suppliers of critical technologies. Limited influence on project level can be supported by influencing the supplier on a strategic level. By collaborating on a strategic level, firms can gain alignment for future projects and diminish the need for direct project control within the projects. Long-term collaborations facilitate control in projects with powerful suppliers of critical technologies.

While many studies suggest simplified responses to complex situations of supplier involvement in product development, this study provides insight into the complex responses to control suppliers of critical technologies.