Governance modes for external technology sourcing in design-driven innovation

The research study draws on four case studies of design-driven innovation analysing the governance modes for the acquisition of external technology during the new product development (NPD) cycle. The study, which can be classified as exploratory analysis, investigated the approaches of four design-oriented Italian companies to the adoption of new materials that serve as the basis for significant product innovation. The efforts made on the part of these companies to progressively improve the performances of these materials and to develop competencies in the material processes have generated new value and, therefore, played a strategic role. The results show that in the early stages of NPD, when market uncertainty and technological uncertainty are very high, these companies choose an informal network. However, once the product concept is defined and the companies need to become familiar with a technology, they move to strategic alliances with partners. In the final stages of NPD, more hierarchical structures seem to prevail. Factors influencing the governance modes choice are discussed. The paper concludes with managerial implications.