Organizing interindustry architectural innovations: Evidence from mobile communication applications

Technologies from different industries are increasingly being combined to create new products and services. A fundamental challenge for the successful development of these interindustry innovations is to combine the previously unconnected technologies in an entirely new product architecture. The development of the required architectural knowledge is especially challenging in an interindustry setting. For instance, specialists from the different industries are likely to have different routines and no prior ties. Given these considerations, this paper explores the conditions for the successful organization of the development process of interindustry architectural innovations. This study adopts a multiple case study design. Based on document analysis and semistructured interviews, three development projects were studied and compared. These projects involved the development of mobile communication applications for services that were already being provided by traditional means in other industry, that is, television, banking, and payment. To increase the likelihood of finding relevant theoretical insights, the three projects were selected based on their different organizational setups, that is, a contractual alliance of two large firms, an informal alliance of two large firms and one small firm, and an independent start-up together with its suppliers. The results show that development projects for interindustry architectural innovations are likely to benefit from an organizational form (1) that includes specialists from the relevant industries; (2) that facilitates intense coordination integration between these specialists; and (3) that facilitates timely decision making and conflict resolution. Interestingly, these organizational dimensions influence project performance jointly rather than individually. Hence, these results lay the ground for the development of a configurational theory. This is a clear contribution to the new product development literature because configurational theories in this field of research are underdeveloped. Configurational theories offer valuable insights for managers who have to make multiple decisions simultaneously rather than in isolation. In particular, this study shows how multiple organizational dimensions can be aligned to produce a synergistic effect, while taking into account the specific characteristics and challenges of interindustry architectural innovations. In particular, this study proposes intense collaborations between specialists from the different industries in which one of these specialists takes the lead. Of course, specialists should be responsible for their areas of expertise, but architectural decisions should be made by consensus and-whenever needed to speed up the process-by fiat. At the same time, the findings suggest that going it alone by start-ups as well as fifty-fifty collaborations between incumbents do not work well for this type of innovation.

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