New service development: areas for exploitation and exploration
01 Apr 2002-Journal of Operations Management (No longer published by Elsevier)-Vol. 20, Iss: 2, pp 135-157
TL;DR: The management of new service development (NSD) has become an important competitive concern in many service industries as discussed by the authors, however, NSD remains among the least studied and understood topics in the service management literature.
About: This article is published in Journal of Operations Management.The article was published on 2002-04-01. It has received 688 citations till now. The article focuses on the topics: Service system & New product development.
Citations
More filters
TL;DR: In this paper, the authors argue that public funding, such as that from national and international agencies, is likely to have a positive influence on firms' innovations by complementing private funding.
Abstract: Innovation is important for the competitive advantage of firms, especially for service firms. We argue that public funding, such as that from national and international agencies, is likely to have a positive influence on firms' innovations by complementing private funding, such as that from foreign and/or domestic firms and organisations. Unlike manufacturing firms, service firms tend to lack complementary resources for innovation; therefore, the additional funding from public sources enables them to acquire the necessary resources for innovation. Empirical results support our arguments.
54 citations
TL;DR: The authors find that all of the business model innovations involve external partnerships during the development process, while only a small proportion of service process innovations involveExternal partnerships.
Abstract: Purpose – The purpose of this paper is to explore different modes of service innovation by examining business model innovation alongside two traditional modes: product innovation and process innovation. Design/methodology/approach – The authors first empirically test a typology using archival data from 69 service innovation projects in a major mobile telecom company. The authors then extend the typology by investigating the interrelationships among service product, service process, and business model innovation based on empirical evidence from multi-mode service innovations. Finally, the authors study the patterns of modes in a networked environment. Findings – The results indicate that the typology is applicable and all three modes of service innovation exist in the sample. The authors find that all of the business model innovations involve external partnerships during the development process, while only a small proportion of service process innovations involve external partnerships. Originality/value – ...
54 citations
TL;DR: This paper examined the relative performance of small and medium-sized service firms with respect to innovation orientations and their effect on business performance and found that exploitation innovation has a stronger effect on small firms compared with medium-size firms.
Abstract: This study examines the relative performance of small- versus medium-sized service firms with respect to innovation orientations and their effect on business performance. We examine the effect of innovation on business performance between the two groups of firms, exploring differences in innovation orientation on performance between the groups of small- and medium-sized firms. We also examine differences within each group, exploring the extent to which innovation focus differs within each group. The empirical data were drawn from 180 managers in Australian service small and medium enterprises. The findings suggest that while there is no difference between small- and medium-sized firms with respect to their innovation orientations, significant differences exist between the firm's size with respect to the effect of innovation orientations on business performance. Specifically, exploitation innovation has a stronger effect on business performance among small firms compared with medium-sized firms, and exploration innovation shows a stronger effect on business performance among medium-sized firms compared with small firms. Overall, the findings show important relative differences between innovation orientations and business performance across different sized firms.
53 citations
Cites background from "New service development: areas for ..."
...A review of literature on innovation in services indicates that this area is still underresearched compared with manufacturing sectors (Menor et al., 2002; Droege et al., 2009)....
[...]
TL;DR: In this paper, the authors present a special issue on cross-disciplinary research at the intersection of operations management and entrepreneurship, which offers the potential to generate new knowledge leading to tangible value for the firm.
52 citations
TL;DR: Data analysis reveals that while MO has a strong and positive effect on NSD‐performance, it has no significant effect on financial performance, and provided evidence for the mediating role of N SD‐performance in the relationship between MO and financial performance in the hospital industry.
Abstract: Purpose – The principal aim of this study is to determine the critical factors of market orientation (MO) and to measure its effect on new service development (NSD) and financial performance of hospital industry in Turkey.Design/methodology/approach – Drawing on a self‐administered questionnaire, the data were collected from a sample of privately‐held general hospitals within the city of Istanbul in Turkey. Based on theoretical considerations, a model was proposed to examine the interrelationships among MO, NSD‐performance and financial performance.Findings – Data analysis reveals that while MO has a strong and positive effect on NSD‐performance, it has no significant effect on financial performance. Also a strong and positive relationship was noted between NSD‐performance and financial performance. Finally, the findings also provided evidence for the mediating role of NSD‐performance in the relationship between MO and financial performance in the hospital industry.Research limitations/implications – Firs...
52 citations
Cites background from "New service development: areas for ..."
...While the development of new services has long been considered by scholars and managers as an important competitive concern in many service industries, it has remained as one of the least understood topics in the service management and innovations literature (Menor et al., 2002)....
[...]
References
More filters
TL;DR: In this paper, the authors consider the relation between the exploration of new possibilities and the exploitation of old certainties in organizational learning and examine some complications in allocating resources between the two, particularly those introduced by the distribution of costs and benefits across time and space.
Abstract: This paper considers the relation between the exploration of new possibilities and the exploitation of old certainties in organizational learning. It examines some complications in allocating resources between the two, particularly those introduced by the distribution of costs and benefits across time and space, and the effects of ecological interaction. Two general situations involving the development and use of knowledge in organizations are modeled. The first is the case of mutual learning between members of an organization and an organizational code. The second is the case of learning and competitive advantage in competition for primacy. The paper develops an argument that adaptive processes, by refining exploitation more rapidly than exploration, are likely to become effective in the short run but self-destructive in the long run. The possibility that certain common organizational practices ameliorate that tendency is assessed.
16,377 citations
6,797 citations
TL;DR: In this paper, the authors organize the product development literature into three streams of research: product development as rational plan, communication web, and disciplined problem solving, and synthesize research findings into a model of factors affecting the success of product development.
Abstract: The literature on product development continues to grow. This research is varied and vibrant, yet large and fragmented. In this article we first organize the burgeoning product-development literature into three streams of research: product development as rational plan, communication web, and disciplined problem solving. Second, we synthesize research findings into a model of factors affecting the success of product development. This model highlights the distinction between process performance and product effectiveness and the importance of agents, including team members, project leaders, senior management, customers, and suppliers, whose behavior affects these outcomes. Third, we indicate potential paths for future research based on the concepts and links that are missing or not well defined in the model.
3,824 citations
"New service development: areas for ..." refers background in this paper
...…that a common set of factors—development process, market/environment, organizational and strategic—impact NPD performance (Schilling and Hill, 1998; Brown and Eisenhardt, 1995; Montoya-Weiss and Calantone, 1994) and NSD performance (de Brentani, 1995; Cooper et al., 1994; Cooper and de Brentani,…...
[...]
...This challenge is particularly difficult given the diverse literature reporting NPD research (see Krishnan and Ulrich, 2001; Wind and Mahajan, 1997; Brown and Eisenhardt, 1995)....
[...]
...The extant NPD research does not have all the answers to the questions of product or service development, but there is a foundation that can be drawn on (see integrative reviews by Krishnan and Ulrich, 2001; Schilling and Hill, 1998; Wind and Mahajan, 1997; Brown and Eisenhardt, 1995)....
[...]
...Underlying the empirical work addressing the antecedents of development performance is the belief that a common set of factors—development process, market/environment, organizational and strategic—impact NPD performance (Schilling and Hill, 1998; Brown and Eisenhardt, 1995; Montoya-Weiss and Calantone, 1994) and NSD performance (de Brentani, 1995; Cooper et al....
[...]
Journal Article•
TL;DR: Porter as discussed by the authors argues that the Internet is not disruptive to most existing industries and established companies and, contrary to recent thought, the Internet itself will be neutralized as a source of advantage.
Abstract: Many of the pioneers of Internet business, both dot-coms and established companies, have competed in ways that violate nearly every precept of good strategy. Rather than focus on profits, they have chased customers indiscriminately through discounting, channel incentives, and advertising. Rather than concentrate on delivering value that earns an attractive price from customers, they have pursued indirect revenues such as advertising and click-through fees. Rather than make trade-offs, they have rushed to offer every conceivable product or service. It did not have to be this way--and it does not have to be in the future. When it comes to reinforcing a distinctive strategy, Michael Porter argues, the Internet provides a better technological platform than previous generations of IT. Gaining competitive advantage does not require a radically new approach to business; it requires building on the proven principles of effective strategy. Porter argues that, contrary to recent thought, the Internet is not disruptive to most existing industries and established companies. It rarely nullifies important sources of competitive advantage in an industry; it often makes them even more valuable. And as all companies embrace Internet technology, the Internet itself will be neutralized as a source of advantage. Robust competitive advantages will arise instead from traditional strengths such as unique products, proprietary content, and distinctive physical activities. Internet technology may be able to fortify those advantages, but it is unlikely to supplant them. Porter debunks such Internet myths as first-mover advantage, the power of virtual companies, and the multiplying rewards of network effects. He disentangles the distorted signals from the marketplace, explains why the Internet complements rather than cannibalizes existing ways of doing business, and outlines strategic imperatives for dot-coms and traditional companies.
3,558 citations
"New service development: areas for ..." refers background in this paper
...The Internet dramatically reduces these barriers, as summarized in Table 3 ( Porter, 2001 )....
[...]
...A differentiation strategy is difficult to attain in a service environment where innovations are quickly and easily copied ( Porter, 2001 )....
[...]
Book•
01 Jan 1986TL;DR: Innovation is defined as "the development and implementation of new ideas by people who over time engage in transactions with others within an institutional order" as mentioned in this paper, where the authors focus on four basic factors new ideas, people, transactions, and institutional context.
Abstract: Innovation is defined as the development and implementation of new ideas by people who over time engage in transactions with others within an institutional order. This definition focuses on four basic factors new ideas, people, transactions, and institutional context. An understanding of how these factors are related leads to four basic problems confronting most general managers: 1 a human problem of managing attention, 2 a process problem in managing new ideas into good currency, 3 a structural problem of managing part-whole relationships, and 4 a strategic problem of institutional leadership. This paper discusses these four basic problems and concludes by suggesting how they fit together into an overall framework to guide longitudinal study of the management of innovation.
3,513 citations
"New service development: areas for ..." refers background in this paper
...Focusing on NPD, Van de Ven (1986) notes four problems related to the management of development and innovation efforts....
[...]
...Focusing on NPD, Van de Ven (1986) notes four problems related to the management of development and innovation efforts....
[...]