Increasing Supplier-Driven Innovation Harvard Case Solution & Analysis

Despite the importance of innovation for business success, but recently the company has not only developed the internal environment that encourages innovation, but also began to identify, grow and use a wide range of external sources for innovation. Among these sources, suppliers are recognized as having a particularly high innovation potential, because they know that the company - that is, their customers are doing, and you need to, and also because the mechanisms for the transfer of knowledge from the vendor to the customer, as a rule, place. However, although it is one thing for a mechanism should be available by which suppliers can transfer innovation to customers, it is quite another for the suppliers actually to make the transfer. The customer, a major driving force in the establishment and maintenance of relations can move in two different ways to encourage suppliers to innovate for the benefit of the client. First, it should reduce or eliminate the three types of problems: (1) conflicting goals of the functional areas of the customer, (2) excessive and often late engineering or technical change, and (3) reducing the price pressure on suppliers, which are only considered clients of financial needs. Second, and most importantly, the customer must immediately initiate positive and confidence-building. "Hide
by John Henke, Chun Zhang Source: MIT Sloan Management Review 8 pages. Publication Date: January 1, 2010. Prod. #: SMR337-PDF-ENG

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