《电子商务 E-business》阅读文献_Leveraging e-R D processesa knowledge-based view

technovation ELSEVIER Technovation 23(2003)905-915 www.elseviercom/locate/technovation Leveraging e-R&D processes: a knowledge-based view Eric h. Kessler Pace University. I Pace Plaza, New York. NY 10038-1598. USA Abstract This is particularly true with regard to applying the technology to the conduct of industrial research and new product development processes, or e-R&D. Notwithstanding, there is scant scientific research to assess how R&d teams are leveraging the Internet in their innovation activities, if their efforts are efficient and effective, and how they could do better. This paper considers the following interrelated research questions: (1)How can Internet-leveraged networks contribute to R&d project management, (2) Where are these networks applied in the r&d process, and (3)What are the likely manifestations of such networks? It develops a framework for understanding and testing these issues, based on a knowledge-based view of the firm, to examine internal, external, and memory related knowledge flows. Then, a three-dimensional template of e-R&D networks is developed that over gr and direction flows, based on Internet attributes, R&d process stages, and major R&D outcomes. Research hypotheses are offered, and directions for future inquiries are discussed. C 2003 Elsevier Ltd. All rights reserved Keywords: R&D; Innovation; Internet 1. Introduction trial research and development processes(Alsene, 1999, Burn and Barnett, 1999, Van den End and Wijnbeg There is much emphasis these days on building effec- 2001). The growing impact of Internet networking tools tive networks, which is well justified given the impor- on R&d is manifest in its transformation of the pro- tance and pervasiveness of network analysis in under- cesses by which organizational actors acquire technical standing management and organizations. From knowledge, develop new products and services, and con- population ecology to sociometric analysis, network con- nect with users. In short, the Internet affects R&D-ori- cepts and modeling approaches have helped us under- ented organizations and groups by changing "the way stand related phenomena at the population, inter-organi- minds work together"(Hafner, 2001) (Scott, 1992). This paper focuses on the Internet, defined businesses now use cyberspace for everything from fin- as the worlds largest information network that connects ance to product development and virtual prototyping computers and the regional and the local networks that Penetration in corporate research has become even connect these computers(Leshin, 1997). The Internet greater, as almost 80% of engineers now use the Internet provides networking-related tools that can be used by for gathering procurement information and almost 95% intra- and inter-organizational groups engaged in the of researchers have started using the Internet in some research and development(R&D) process form or another to improve their design and development The Internet profoundly influences people's personal work. Combined, these observations suggest that cyber- lives and a growing number of organizational functions. innovation processes, or" e-R&D"'(c f, rolandber It affects technology strategy and the conduct of indus- ger. com, 2001), has emerged as a cutting-edge area of application and investigation. Thus, it certainly warrants the attention of academics, consultants, and corporate Corresponding author. Tel: +1-212-346-1885: fax: +1-212.346. professionals in the technology and innovation manage E-mail address: kessler(@pace. edu(EH. Kessler) notwithstanding, there has been comparatively little 0166-4972/S- see front matter 2003 Elsevier Ltd. All rights reserved doi:10.10160166-4972(03)00108-1

Technovation 23 (2003) 905–915 www.elsevier.com/locate/technovation Leveraging e-R&D processes: a knowledge-based view Eric H. Kessler ∗ Lubin School of Business, Pace University, 1 Pace Plaza, New York, NY 10038-1598, USA Abstract There is a growing application of Internet-driven networking tools to improve organizations and teams’ value-creating activities. This is particularly true with regard to applying the technology to the conduct of industrial research and new product development processes, or e-R&D. Notwithstanding, there is scant scientific research to assess how R&D teams are leveraging the Internet in their innovation activities, if their efforts are efficient and effective, and how they could do better. This paper considers the following interrelated research questions: (1) How can Internet-leveraged networks contribute to R&D project management, (2) Where are these networks applied in the R&D process, and (3) What are the likely manifestations of such networks? It develops a framework for understanding and testing these issues, based on a knowledge-based view of the firm, to examine internal, external, and memory￾related knowledge flows. Then, a three-dimensional template of e-R&D networks is developed that overlays each of these three flows, based on Internet attributes, R&D process stages, and major R&D outcomes. Research hypotheses are offered, and directions for future inquiries are discussed.  2003 Elsevier Ltd. All rights reserved. Keywords: R&D; Innovation; Internet 1. Introduction There is much emphasis these days on building effec￾tive networks, which is well justified given the impor￾tance and pervasiveness of network analysis in under￾standing management and organizations. From population ecology to sociometric analysis, network con￾cepts and modeling approaches have helped us under￾stand related phenomena at the population, inter-organi￾zational, intra-organizational, and interpersonal levels (Scott, 1992). This paper focuses on the Internet, defined as the world’s largest information network that connects computers and the regional and the local networks that connect these computers (Leshin, 1997). The Internet provides networking-related tools that can be used by intra- and inter-organizational groups engaged in the research and development (R&D) process. The Internet profoundly influences people’s personal lives and a growing number of organizational functions. It affects technology strategy and the conduct of indus- ∗ Corresponding author. Tel.: +1-212-346-1885; fax: +1-212-346- 1573. E-mail address: ekessler@pace.edu (E.H. Kessler). 0166-4972/$ - see front matter  2003 Elsevier Ltd. All rights reserved. doi:10.1016/S0166-4972(03)00108-1 trial research and development processes (Alsene, 1999, Burn and Barnett, 1999; Van den End and Wijnbeg, 2001). The growing impact of Internet networking tools on R&D is manifest in its transformation of the pro￾cesses by which organizational actors acquire technical knowledge, develop new products and services, and con￾nect with users. In short, the Internet affects R&D-ori￾ented organizations and groups by changing “the way minds work together” (Hafner, 2001). Consider the following trends: More than one-third of businesses now use cyberspace for everything from fin￾ance to product development and virtual prototyping. Penetration in corporate research has become even greater, as almost 80% of engineers now use the Internet for gathering procurement information and almost 95% of researchers have started using the Internet in some form or another to improve their design and development work. Combined, these observations suggest that cyber￾innovation processes, or “e-R&D” (c.f., rolandber￾ger.com, 2001), has emerged as a cutting-edge area of application and investigation. Thus, it certainly warrants the attention of academics, consultants, and corporate professionals in the technology and innovation manage￾ment field. Notwithstanding, there has been comparatively little

E.H. Kessler/Technovation 23(2003)905-915 conceptual modeling, especially with regard to big-pic- the Internets potential is not equaled by its current state ture relationships, and systematic, empirical investi- of leverage within and between organizations to create gation into the optimization of these tools across the networked processes innovation process. That is, although there is a general With regard to upstream utilication of the Internet in acknowledgement in the literature that Internet-enabled an e-R&d process, Barua et al. (1997) developed an ana- networks are a potentially valuable tool to facilitate r& lytical model that offers buyers a maximized payoff from D activities, there are few specific, empirical studies that the selection process by using the Internet for procure- systematically investigate this assertion. Instead, most ment. Mitchell(2000)and Finch(1999)propose ways research-related articles in this field are derived of idio- that the Internet can help corporations capture the crea- tions. Moreover, these articles are largely disconnected specifically, Plymale and Hartgrove(1999)elaborate on from each other. They appear in a wide variety of litera- two areas "ripe for evolution on the Web", online com- ture and seldom cross-reference or build from each parison of components and design-in capabilities in others specialized focus. Indeed, it is fair to say that the component selection. Indeed, Studt's(1999) survey of literature is somewhat embryonic and fragmented industrial researchers reveals that, currently, the To provide an overall picture of the general state of maximum use of the Internet was finding technical infor the related literature, we adapt and apply Deise et al.'s mation followed by finding new product information and (2000)typology, of e-business channel enhancements then sourcing and purchasing information. Hefner(2001) as the Internet. Through this lens, one can conceptualize process for a new wireless headset for its minivan, which e-R&D input(or upstream)enhancements, conversion used the internet to coordinate the half-dozen contractors (or business process)enhancements, and downstream(or in virtual meetings selling and service)enhancements In terms of general considerations of e-R&D net With regard to process management via the Internet in an e-R&D process, Deitz(1997) ponders ways to re- working tools, Andrews(1999)argues that the Internet architecture design tools such as CAD, CAM, and CAE impacts R&D primarily by altering not the end products to smoothly interface with the Internet. lansiti and but the overall R&D process. Andrews proposition is consistent with the tone of this manuscript, where I focus consider whether the Internet can be used to create a not on e-products but on e-R&D. Similarly, Antonelli et al. (2000)argue that the Internet is a critical medium for more effective development process for new products linking the development of information and new knowl- To this end, Richir et al. (2001)describe a digital edge with its application. They contend that the Internet eering design process that allows quicker innovation in a more creative way and favors direct commercialization can be used to change the process of the accumulating of industrial products that may be kept virtual throughout new knowledge and affect the pace and direction of sub- sequent technological convergence upon which the evol the design process. They argue that this type of process ution of information and communication technologies also offers the potential for design as well as marketing rests.Ghosh(1998)adds that the Internet presents differ- of these industrial products. For example, Sawhney and ent types of opportunities for established businesses, one Prandelli (2000)show how the Internet can enable"com- being its use to develop and deliver new products and munities of creation", or virtual shared spaces for hosting services for new customers. He discusses potential ways relationships and facilitating knowledge generation and for a company to do this: Use it for direct access to sharing. Subsequent to design, Dahan and Srinivasan uct concept test- serve new customer segments (new niches), and to con- ing method that incorporates virtual prototypes of new duct transactions over it(e-commerce). Sweeney (1999) product concepts. These authors elaborate on the poss- reports on several firms that are"leveraging Internet ible ways of applying the Internet to facilitate a low-cost technology to streamline product development, manage parallel testing procedure that produced market shares teams of workers in geographically dispersed locations, closely mirroring those obtained with the physical pro- and reduce time to complete projects". Nevertheless, he ducts concludes " the average company still lags well behind In a slightly different yet complementary angle, Gupta these trailblazers. This is important, for Miller(2001) (1997) considers the possibilities of using Intranets and ightly observes that the Internet will be a critical Internets to facilitate internal communication. To this omponent in fourth generation(4G) technology man- point, Hameri and Nihtila(1997)observe that the Inter agement;alas, most firms are still practicing outmoded net and World Wide Web(www) can be effectively forms of technology management. Also, McGrath(2001) used to manage and disseminate project information claims that the networked economy is changing all the throughout an organization. Similarly, Hibbard and Car rules in innovation. All in all, the consensus appears that rillo (1998)discuss the potential for leveraging the Inter

906 E.H. Kessler / Technovation 23 (2003) 905–915 conceptual modeling, especially with regard to big-pic￾ture relationships, and systematic, empirical investi￾gation into the optimization of these tools across the innovation process. That is, although there is a general acknowledgement in the literature that Internet-enabled networks are a potentially valuable tool to facilitate R& D activities, there are few specific, empirical studies that systematically investigate this assertion. Instead, most research-related articles in this field are derived of idio￾syncratic observations and small-sample case descrip￾tions. Moreover, these articles are largely disconnected from each other. They appear in a wide variety of litera￾ture and seldom cross-reference or build from each other’s specialized focus. Indeed, it is fair to say that the literature is somewhat embryonic and fragmented. To provide an overall picture of the general state of the related literature, we adapt and apply Deise et al.’s (2000) typology of e-business channel enhancements that result from leveraging information technology such as the Internet. Through this lens, one can conceptualize e-R&D input (or upstream) enhancements, conversion (or business process) enhancements, and downstream (or selling and service) enhancements. In terms of general considerations of e-R&D net￾working tools, Andrews (1999) argues that the Internet impacts R&D primarily by altering not the end products but the overall R&D process. Andrew’s proposition is consistent with the tone of this manuscript, where I focus not on e-products but on e-R&D. Similarly, Antonelli et al. (2000) argue that the Internet is a critical medium for linking the development of information and new knowl￾edge with its application. They contend that the Internet can be used to change the process of the accumulating new knowledge and affect the pace and direction of sub￾sequent technological convergence upon which the evol￾ution of information and communication technologies rests. Ghosh (1998) adds that the Internet presents differ￾ent types of opportunities for established businesses, one being its use to develop and deliver new products and services for new customers. He discusses potential ways for a company to do this: Use it for direct access to customers (marketing), to mine its own digital assets to serve new customer segments (new niches), and to con￾duct transactions over it (e-commerce). Sweeney (1999) reports on several firms that are “leveraging Internet technology to streamline product development, manage teams of workers in geographically dispersed locations, and reduce time to complete projects”. Nevertheless, he concludes “the average company still lags well behind” these trailblazers. This is important, for Miller (2001) rightly observes that the Internet will be a critical component in fourth generation (4G) technology man￾agement; alas, most firms are still practicing outmoded forms of technology management. Also, McGrath (2001) claims that the networked economy is changing all the rules in innovation. All in all, the consensus appears that the Internet’s potential is not equaled by its current state of leverage within and between organizations to create networked processes. With regard to upstream utilization of the Internet in an e-R&D process, Barua et al. (1997) developed an ana￾lytical model that offers buyers a maximized payoff from the selection process by using the Internet for procure￾ment. Mitchell (2000) and Finch (1999) propose ways that the Internet can help corporations capture the crea￾tivity and insight of consumers and suppliers. More specifically, Plymale and Hartgrove (1999) elaborate on two areas “ripe for evolution on the Web”, online com￾parison of components and design-in capabilities in component selection. Indeed, Studt’s (1999) survey of industrial researchers reveals that, currently, the maximum use of the Internet was finding technical infor￾mation followed by finding new product information and then sourcing and purchasing information. Hefner (2001) illustrates this by describing Chrysler’s development process for a new wireless headset for its minivan, which used the Internet to coordinate the half-dozen contractors in virtual meetings. With regard to process management via the Internet in an e-R&D process, Deitz (1997) ponders ways to re￾architecture design tools such as CAD, CAM, and CAE to smoothly interface with the Internet. Iansiti and McCormack (1997) and Gardiner and Ritchie (1999) consider whether the Internet can be used to create a more effective development process for new products. To this end, Richir et al. (2001) describe a digital engin￾eering design process that allows quicker innovation in a more creative way and favors direct commercialization of industrial products that may be kept virtual throughout the design process. They argue that this type of process also offers the potential for design as well as marketing of these industrial products. For example, Sawhney and Prandelli (2000) show how the Internet can enable “com￾munities of creation”, or virtual shared spaces for hosting relationships and facilitating knowledge generation and sharing. Subsequent to design, Dahan and Srinivasan (2000) describe an Internet-based product concept test￾ing method that incorporates virtual prototypes of new product concepts. These authors elaborate on the poss￾ible ways of applying the Internet to facilitate a low-cost, parallel testing procedure that produced market shares closely mirroring those obtained with the physical pro￾ducts. In a slightly different yet complementary angle, Gupta (1997) considers the possibilities of using Intranets and Internets to facilitate internal communication. To this point, Hameri and Nihtila (1997) observe that the Inter￾net and World Wide Web (WWW) can be effectively used to manage and disseminate project information throughout an organization. Similarly, Hibbard and Car￾rillo (1998) discuss the potential for leveraging the Inter-

E.H. Kessler/Technovation 23(2003)905-915 net to facilitate knowledge management strategies in structures also contributes the knowledge applied to a project(Burgelman and Rosenbloom, 1989; Prahalad With regard to downstream application of the Internet and Hamel, 1990). How well an organizations teams in an e-R&D process, Corbiltt(1999)offers useful manage relevant internal and external networks, as well observations about how the Internet might be best used as the cumulative and long-term manifestations of these for secure financial transactions(e.g, digital signatures networks in its organizational memory, has direct impli and firewalls). Darko(1999)describes some applications cations concerning the success of its R&d processes for developing partner-like relationships between com-(Kessler et al., 2001, 2000). These relationships are rep panies and consumers. Landry (1999)discusses the resented in Fig. 1. The subsequent sections discuss how potential in the area of Internet-based product testing, leveraging Internet-driven e-R&D networking tools can which allows companies to get customers' reactions be a valuable tool for facilitating internal, external, and quickly and cheaply. Moreover, Mathieu(2001) argues memory-related knowledge flows that, since technology transfer can be viewed largely a communication phenomenon, web-based information 2. 2. Internal learning networks systems can be used to help technology transfer Specifically, he examines manufacturing technologie The internal learning processes of an organizations related to rapid prototyping, production planning and R&d groups start with the creation of knowledge by control, performance measurement, design for manufac- individuals( Simon, 1991); e-R&D networking tools can ure, supply chain management and manufacturing give individuals access to a world of information and potential fodder for insights, ranging from general news In summary, the relevant e-R&D-related literature is webpages to a firm's project database. New ideas are largely a collection of practitioner-based observations then circulated among small networks of co-workers in and illustrative case studies, as well as a growing yet a"community-of-practice"in the sense that they share poorly connected body of more scholarly inquiries. similar perspectives and interpretation framework There is scant theory-driven research to assess how com-(Brown and Duguid, 1991; Hedberg, 1981); e-R&d net anies are leveraging the Internet, if their efforts are working tools can provide channels for idea circulation efficient and effective, and how they could do better and can standardize information distribution approaches This paper attempts to enhance the foundations for such to develop shared frameworks. Organizational learning a broad-based endeavor. It adopts a knowledge-based occurs when the knowledge is transferred to the larger view of the firm and offers a more general tone to reflect organizational network of individual specialists, inte- the relative embryonic state of the scientific research grated with other knowledge areas, and applied to a new literature as compared to actual business practices. For- product or process(Nonaka, 1994): e-R&D networking mally, it consider the following interrelated research tools can facilitate knowledge transfer and, when com- questions:(1)HOW can Internet-leveraged networks bined with database tools, help integrate knowledge into contribute to r&d project management, (2)WHERE are existing paradigms and memory. Further, e-R&D net- these networks applied in the r&d process, and (3) working tools are particularly well suited to overcome WhaT are the likely manifestations of such networks traditional barriers to internal learning networks by pro- moting values such as openness and teamwork (Starbuck, 1992), decentralized linkages and knowledge 2. Hypotheses development flows(Fiol and Lyles, 1985), and enhanced quantity and quality of communication(Damanpour, 1991) 2.1. e-R&D newworks vis-a-vis a knowledge-based Hypothesis la. Organizations that leverage e-R&D view of the firm networks in project groups'internal learning processes to a greater extent will be more successful innovators A knowledge-based view of firm activities is centered than those organizations that do so to a lesser extent around the notion that a firms success depends on how well it can(a)enhance its own knowledge base by either creating or obtaining new knowledge, (b) integrate its External learnin different knowledge areas, and(c)apply its knowledge to the development or enhancement of products or pro Internal Learning cesses(Grant, 1996, Nonaka, 1994, Kogut and Zander 92). Both internal and external knowledge flows con &D Project tribute to r&D-oriented group activity, although there Success considerable variability between projects on their rela onal Memory tive degree of contribution. In addition, inter-project learning via organizationally institutionalized memory Fig 1. General knowledge fows in a networked R&D process

E.H. Kessler / Technovation 23 (2003) 905–915 907 net to facilitate knowledge management strategies in general. With regard to downstream application of the Internet in an e-R&D process, Corbiltt (1999) offers useful observations about how the Internet might be best used for secure financial transactions (e.g., digital signatures and firewalls). Darko (1999) describes some applications for developing partner-like relationships between com￾panies and consumers. Landry (1999) discusses the potential in the area of Internet-based product testing, which allows companies to get customers’ reactions quickly and cheaply. Moreover, Mathieu (2001) argues that, since technology transfer can be viewed largely as a communication phenomenon, web-based information systems can be used to help technology transfer. Specifically, he examines manufacturing technologies related to rapid prototyping, production planning and control, performance measurement, design for manufac￾ture, supply chain management and manufacturing simulation. In summary, the relevant e-R&D-related literature is largely a collection of practitioner-based observations and illustrative case studies, as well as a growing yet poorly connected body of more scholarly inquiries. There is scant theory-driven research to assess how com￾panies are leveraging the Internet, if their efforts are efficient and effective, and how they could do better. This paper attempts to enhance the foundations for such a broad-based endeavor. It adopts a knowledge-based view of the firm and offers a more general tone to reflect the relative embryonic state of the scientific research literature as compared to actual business practices. For￾mally, it consider the following interrelated research questions: (1) HOW can Internet-leveraged networks contribute to R&D project management, (2) WHERE are these networks applied in the R&D process, and (3) WHAT are the likely manifestations of such networks. 2. Hypotheses development 2.1. e-R&D networks vis-a-vis a knowledge-based view of the firm A knowledge-based view of firm activities is centered around the notion that a firm’s success depends on how well it can (a) enhance its own knowledge base by either creating or obtaining new knowledge, (b) integrate its different knowledge areas, and (c) apply its knowledge to the development or enhancement of products or pro￾cesses (Grant, 1996; Nonaka, 1994; Kogut and Zander, 1992). Both internal and external knowledge flows con￾tribute to R&D-oriented group activity, although there is considerable variability between projects on their rela￾tive degree of contribution. In addition, inter-project learning via organizationally institutionalized memory structures also contributes the knowledge applied to a project (Burgelman and Rosenbloom, 1989; Prahalad and Hamel, 1990). How well an organization’s teams manage relevant internal and external networks, as well as the cumulative and long-term manifestations of these networks in its organizational memory, has direct impli￾cations concerning the success of its R&D processes (Kessler et al., 2001, 2000). These relationships are rep￾resented in Fig. 1. The subsequent sections discuss how leveraging Internet-driven e-R&D networking tools can be a valuable tool for facilitating internal, external, and memory-related knowledge flows. 2.2. Internal learning networks The internal learning processes of an organization’s R&D groups start with the creation of knowledge by individuals (Simon, 1991); e-R&D networking tools can give individuals access to a world of information and potential fodder for insights, ranging from general news webpages to a firm’s project database. New ideas are then circulated among small networks of co-workers in a “community-of-practice” in the sense that they share similar perspectives and interpretation frameworks (Brown and Duguid, 1991; Hedberg, 1981); e-R&D net￾working tools can provide channels for idea circulation and can standardize information distribution approaches to develop shared frameworks. Organizational learning occurs when the knowledge is transferred to the larger organizational network of individual specialists, inte￾grated with other knowledge areas, and applied to a new product or process (Nonaka, 1994); e-R&D networking tools can facilitate knowledge transfer and, when com￾bined with database tools, help integrate knowledge into existing paradigms and memory. Further, e-R&D net￾working tools are particularly well suited to overcome traditional barriers to internal learning networks by pro￾moting values such as openness and teamwork (Starbuck, 1992), decentralized linkages and knowledge flows (Fiol and Lyles, 1985), and enhanced quantity and quality of communication (Damanpour, 1991). Hypothesis 1a. Organizations that leverage e
R&D networks in project groups’ internal learning processes to a greater extent will be more successful innovators than those organizations that do so to a lesser extent. Fig. 1. General knowledge flows in a networked R&D process

E.H. Kessler/Technovation 23(2003)905-915 2.3. External learning networ tutionalized practices. e-R&d networking tools can be used to capture and store knowledge through systemized In contrast, the external learning process starts with collection and coding of tasks and projects in files and the identification of a new idea by an outside source and formal procedures and dissemination can be improved the subsequent inter-network integration of this idea into by the use of computer systems and organizational the focal organization. The new ideas may come from intranets. For example, information, expert, and prob- customer and lead user feedback(Pascale, 1984, Von lem-solution databases can be used to facilitate inter Hipple, 1988); e-R&D networking tools are a source of project learning feedback insofar as they provide advanced and real-time However, it is important to note that much R&D linkages with these parties. External ideas can also be related knowledge is tacit, or difficult to codify. There opied from competitors via the monitoring of patents, fore it must be shared, stored and retrieved by more publications, and public statements (Ghoshal and direct communications and sharing of experiences Westney, 1991; Gilad and Gilad, 1988; Bierly and Chak Nonaka, 1994). It is critical during the new product rabarti, 1996); e-R&D networking tools can help monitor development process to convert tacit knowledge stored these developments through business intelligence fea- in the organizations memory into explicit knowledge tures, such as automatic scan and manual search pro- that can be understood by individuals lacking experience cedures, that sift through and pinpoint relevant infor- in a specific area. To this end, e-R&D networking tools mation among the immense Internet-available pool of can help overcome barriers to this translation by aiding information in the storage and dissemination of information Organizations'R&D-oriented groups also learn from (Huber, 1991) others outside their industry such as university and Hypothesis lc. Organizations that leverage e-R&D government research centers(Imai et al., 1988; Mowery networks in project groups'institutionalized memory et al., 1996; Porter, 1990); e-R&D networking tools can processes to a greater extent will be more successful provide vehicles for participating in these geographically innovators than those organizations that do so to a dispersed cooperative arrangements. Additionally, e-R&d lesser extent networking tools are particularly well suited to overcome traditional barriers to external learning, such as the not- 2. 5. A 3-dimensional model of internet-driven e-R&D invented-here(NIH) syndrome(Katz and Allen, 1982), networked processes nsofar as they make the process of group members accessing outside information easier and more legitimate and increase the degree to which existing expertise can Second, I consider the nature and effects of applying be applied to understand the outside source(Cohen and the Internet to facilitate these knowledge flows via net- Levinthal, 1990) worked R&D activities-1.e, e-R&D. In a global sense Hypothesis 1b. Organizations that leverage e-R&d I apply Deise et al. s(2000)model to postulate that the networks in project groups'external learning processes Internet can(a) facilitate existing tasks in the r&d pro- to a greater extent will be more successful innovators cess(can do the same stuff faster, cheaper, better-it is than those organizations that do so to a lesser extent. an enhancement and of incremental value-and(b) the Internet fundamentally alters the r&d process(new ry and longitudinal learnin game, new rules, new criteria, new steps, tasks, and nero sequences, etc.)it is transformational and of frame- breaking value. This is consistent with research in the Over time, a firm's success in R&D is a function of innovation literature that suggests R&d projects should the cumulative development of internal and external be distinguished by their degree of radicalness, or degree learning. Therefore, the management of an organiza- of change(Damanpour, 1991; Eisenhardt and Tabrizi tion's memory, or the stored information from its history 1995: Mc Donough, 1993). Radical innovations are less that can be transferred from group to group and brought certain, involve a greater proportion of experimentation to bear on present decisions(Walsh and Ungson, 1991), and iterative problem solving, and hence require more is crucial. As individuals and groups share and integrate flexibility and learning, e-R&D networking tools can knowledge, the knowledge is stored in the organizational provide low-risk experimentation options via electronic structure, systems, routines and procedures. This contrib- mediums and broad access to sources of information and utes to the development of technological capabilities that learning. Incremental innovations are more certain can be applied across projects(Burgelman and Rosen- involve a greater proportion of planning and implemen- bloom, 1989, Prahalad and Hamel, 1990). When individ- tation, and hence require more efficiency and com- uals leave a team or organization, some of their knowl- pression; e-R&d networking tools can provide planning edge also leaves but, depending on the effectiveness of and organizational resources as well as cost-effective he organizational memory, some also remain communication and distribution and systems

908 E.H. Kessler / Technovation 23 (2003) 905–915 2.3. External learning networks In contrast, the external learning process starts with the identification of a new idea by an outside source and the subsequent inter-network integration of this idea into the focal organization. The new ideas may come from customer and lead user feedback (Pascale, 1984; Von Hipple, 1988); e-R&D networking tools are a source of feedback insofar as they provide advanced and real-time linkages with these parties. External ideas can also be copied from competitors via the monitoring of patents, publications, and public statements (Ghoshal and Westney, 1991; Gilad and Gilad, 1988; Bierly and Chak￾rabarti, 1996); e-R&D networking tools can help monitor these developments through business intelligence fea￾tures, such as automatic scan and manual search pro￾cedures, that sift through and pinpoint relevant infor￾mation among the immense Internet-available pool of information. Organizations’ R&D-oriented groups also learn from others outside their industry such as university and government research centers (Imai et al., 1988; Mowery et al., 1996; Porter, 1990); e-R&D networking tools can provide vehicles for participating in these geographically dispersed cooperative arrangements. Additionally, e-R&D networking tools are particularly well suited to overcome traditional barriers to external learning, such as the not￾invented-here (NIH) syndrome (Katz and Allen, 1982), insofar as they make the process of group members accessing outside information easier and more legitimate and increase the degree to which existing expertise can be applied to understand the outside source (Cohen and Levinthal, 1990). Hypothesis 1b. Organizations that leverage e
R&D networks in project groups’ external learning processes to a greater extent will be more successful innovators than those organizations that do so to a lesser extent. 2.4. Organizational memory and longitudinal learning networks Over time, a firm’s success in R&D is a function of the cumulative development of internal and external learning. Therefore, the management of an organiza￾tion’s memory, or the stored information from its history that can be transferred from group to group and brought to bear on present decisions (Walsh and Ungson, 1991), is crucial. As individuals and groups share and integrate knowledge, the knowledge is stored in the organizational structure, systems, routines and procedures. This contrib￾utes to the development of technological capabilities that can be applied across projects (Burgelman and Rosen￾bloom, 1989; Prahalad and Hamel, 1990). When individ￾uals leave a team or organization, some of their knowl￾edge also leaves but, depending on the effectiveness of the organizational memory, some also remains as insti￾tutionalized practices. e-R&D networking tools can be used to capture and store knowledge through systemized collection and coding of tasks and projects in files and formal procedures and dissemination can be improved by the use of computer systems and organizational intranets. For example, information, expert, and prob￾lem–solution databases can be used to facilitate inter￾project learning. However, it is important to note that much R&D￾related knowledge is tacit, or difficult to codify. There￾fore it must be shared, stored and retrieved by more direct communications and sharing of experiences (Nonaka, 1994). It is critical during the new product development process to convert tacit knowledge stored in the organization’s memory into explicit knowledge that can be understood by individuals lacking experience in a specific area. To this end, e-R&D networking tools can help overcome barriers to this translation by aiding in the storage and dissemination of information (Huber, 1991). Hypothesis 1c. Organizations that leverage e
R&D networks in project groups’ institutionalized memory processes to a greater extent will be more successful innovators than those organizations that do so to a lesser extent. 2.5. A 3-dimensional model of Internet-driven e-R&D networked processes Second, I consider the nature and effects of applying the Internet to facilitate these knowledge flows via net￾worked R&D activities—i.e., e-R&D. In a global sense, I apply Deise et al.’s (2000) model to postulate that the Internet can (a) facilitate existing tasks in the R&D pro￾cess (can do the same stuff faster, cheaper, better)—it is an enhancement and of incremental value—and (b) the Internet fundamentally alters the R&D process (new game, new rules, new criteria, new steps, tasks, and sequences, etc..)—it is transformational and of frame￾breaking value. This is consistent with research in the innovation literature that suggests R&D projects should be distinguished by their degree of radicalness, or degree of change (Damanpour, 1991; Eisenhardt and Tabrizi, 1995; McDonough, 1993). Radical innovations are less certain, involve a greater proportion of experimentation and iterative problem solving, and hence require more flexibility and learning; e-R&D networking tools can provide low-risk experimentation options via electronic mediums and broad access to sources of information and learning. Incremental innovations are more certain, involve a greater proportion of planning and implemen￾tation, and hence require more efficiency and com￾pression; e-R&D networking tools can provide planning and organizational resources as well as cost-effective communication and distribution and systems

E.H. Kessler/Technovation 23(2003)905-915 Hypothesis 2a. An Internet-driven networked e-R& R&D Outcome D process can both enhance and transform R&D It is also important to heed the advice of scholars who knowledge flows and stages in the innovation process (e.g. Damanpour, 1991; Spender and Kessler, 1995). For example, Kessler et al.(2000) found that the func- tionality of applying external knowledge(such as that Internet Function accessed via the Internet)to the r&d process is different depending on the type of knowledge and the stage of R&d to which it is applied. This means that some tasks might be seen as more sensitive to e-R&D interventions R&D Process than others. Moreover, it is important to acknowledge that strategy and specifically new product innovation will be different depending on the industries and con- e-r&dy Fig. 2. 3-D model of Internet-driven networks influence on R&D (3D texts considered(e.g, He enderson and Mitchell. 1997 Schoonhoven et al., 1990). For instance, e-R&D migh be more valuable to teams within firms with a fast-fol- variables). It is essentially a tool for exploring the lower or efficient-producer strategy who need to access dynamics of e-R&D networks for each of the internal ing information, or perhaps within firms with a first- external, and memory knowledge flows described in the mover strategy who need to quickly create and inte- grate information The first dimension of the 3D e-R&D model is major Additionally, e-R&D might be more valuable to teams Internet attributes. ldentifying and analyzing the specific within large firms that have greater information systems functions of the Internet allows us to assess its potential capability or perhaps within small firms who may be benefits and detriments to the r&d process. Consider more flexible and receptive to new information and its for example the following functional features of the permutations. Extending this logic, it stands to reason Internet(Muller, 1999)as detailed in Table 1 that the internet will be more or less functional in differ- These Internet attributes can be simplified and con- ent types of competitive, technological, demographic, densed into the following four general categories of etc environments. For instance, e-R&D might be more Internet functions(Leshin, 1997) important in fast-moving contexts(e.g, it offers real time interpersonal access), hyper-competitive contexts 1. Communication(e.g, email): Allows group members (e.g, it may be exploited as a source of advantage), and to send, forward, and receive messages from people ambiguous contexts (e.g, it serves as a source of all over the world. Enables members to reply to, save information). Notwithstanding the many potential mod- file and categorize received messages. Enables mem- erating variables and permutations of their interactions, bers to participate in electronic conferences and dis- a more general argument is offered for these types of cussions as well as to request information from agenc- contingent relationships and testing specific phenomena ies, organizations, institutions, and other people within its logical umbrella Email represents one form of Internet communication Hypothesis 2b. The functionality of an Internet along with electronic discussion groups(listservs and driven networked e-R&d process will be moderated by usenet), Internet relay chat(IRC), Internet phones groups'context such as R&D stage, firm size and strat and desktop Internet video conferencing egy, and industry 2. Connection (e.g, Telnet): Provides the capability to We can develop a three-dimensional model to more a remote computer and work interactively specifically examine the functionality of various attri- with it. Allow group members to work on the remote butes of the Internet at various stages of the r&D pro- computer's power and speed and utilize its software cess on various r&d outcome variables Some services available through telnet include data- This 3d e-R&D model finds its roots in the logic of bases. libraries chats and bulletin boards similar models that explore multiple simultaneous inter- 3. Transfer(e.g, file transfer protocol, or FTP): Method actions such as the"House of Quality"(Hauser and that allows group members to move files and data Clausing, 1988). The 3D e-R&D model is used to exam- from one computer to another. Enables members to ine the effects of Internet application(segmented by its download (receive) and upload(send) information different attributes or functionalities) on the r&d team such as books. documents and software process(segmented by its different stages or sets of 4. Access(e.g, World Wide Web): Collection of stan- related activities) and manifest R&d outcomes dards and protocols used by group members to access (segmented by its different dimensions or strategic information available on the Internet such as docu-

E.H. Kessler / Technovation 23 (2003) 905–915 909 Hypothesis 2a. An Internet
driven networked e
R& D process can both enhance and transform R&D. It is also important to heed the advice of scholars who have pointed to a moderated relationship between knowledge flows and stages in the innovation process (e.g. Damanpour, 1991; Spender and Kessler, 1995). For example, Kessler et al. (2000) found that the func￾tionality of applying external knowledge (such as that accessed via the Internet) to the R&D process is different depending on the type of knowledge and the stage of R&D to which it is applied. This means that some tasks might be seen as more sensitive to e-R&D interventions than others. Moreover, it is important to acknowledge that strategy and specifically new product innovation will be different depending on the industries and con￾texts considered (e.g., Henderson and Mitchell, 1997; Schoonhoven et al., 1990). For instance, e-R&D might be more valuable to teams within firms with a fast-fol￾lower or efficient-producer strategy who need to access existing information, or perhaps within firms with a first￾mover strategy who need to quickly create and inte￾grate information. Additionally, e-R&D might be more valuable to teams within large firms that have greater information systems capability or perhaps within small firms who may be more flexible and receptive to new information and its permutations. Extending this logic, it stands to reason that the Internet will be more or less functional in differ￾ent types of competitive, technological, demographic, etc. environments. For instance, e-R&D might be more important in fast-moving contexts (e.g., it offers real￾time interpersonal access), hyper-competitive contexts (e.g., it may be exploited as a source of advantage), and ambiguous contexts (e.g., it serves as a source of information). Notwithstanding the many potential mod￾erating variables and permutations of their interactions, a more general argument is offered for these types of contingent relationships and testing specific phenomena within its logical umbrella. Hypothesis 2b. The functionality of an Internet
driven networked e
R&D process will be moderated by groups’ context such as R&D stage, firm size and strat￾egy, and industry. We can develop a three-dimensional model to more specifically examine the functionality of various attri￾butes of the Internet at various stages of the R&D pro￾cess on various R&D outcome variables—see Fig. 2. This 3D e-R&D model finds its roots in the logic of similar models that explore multiple simultaneous inter￾actions such as the “House of Quality” (Hauser and Clausing, 1988). The 3D e-R&D model is used to exam￾ine the effects of Internet application (segmented by its different attributes or functionalities) on the R&D team process (segmented by its different stages or sets of related activities) and manifest R&D outcomes (segmented by its different dimensions or strategic Fig. 2. 3-D model of Internet-driven networks influence on R&D (3D e-R&D). variables). It is essentially a tool for exploring the dynamics of e-R&D networks for each of the internal, external, and memory knowledge flows described in the preceding section. The first dimension of the 3D e-R&D model is major Internet attributes. Identifying and analyzing the specific functions of the Internet allows us to assess its potential benefits and detriments to the R&D process. Consider for example the following functional features of the Internet (Muller, 1999) as detailed in Table 1. These Internet attributes can be simplified and con￾densed into the following four general categories of Internet functions (Leshin, 1997): 1. Communication (e.g., email): Allows group members to send, forward, and receive messages from people all over the world. Enables members to reply to, save, file, and categorize received messages. Enables mem￾bers to participate in electronic conferences and dis￾cussions as well as to request information from agenc￾ies, organizations, institutions, and other people. Email represents one form of Internet communication, along with electronic discussion groups (listservs and usenets), Internet relay chat (IRC), Internet phones, and desktop Internet video conferencing. 2. Connection (e.g., Telnet): Provides the capability to login to a remote computer and work interactively with it. Allow group members to work on the remote computer’s power and speed and utilize its software. Some services available through Telnet include data￾bases, libraries, chats, and bulletin boards. 3. Transfer (e.g., file transfer protocol, or FTP): Method that allows group members to move files and data from one computer to another. Enables members to download (receive) and upload (send) information such as books, documents, and software. 4. Access (e.g., World Wide Web): Collection of stan￾dards and protocols used by group members to access information available on the Internet such as docu-

E.H. Kessler/Technovation 23(2003)905-915 Table 1 Major Internet attributes Internet attribute Business-messaging Calendar/scheduling, document management, line-of-business applications, workflow management, supply-chain management, fax routers Call centers Telemarketing. customer service Address book, alias support, audio conferencing, channel filtering, client-to-client protocol, colored tex encryption, whiteboard, yellow pages Client server network Global enterprise solutions Data Remote access and storage Distance learning Education/training Product and service sales, online banking Electronic data interchange Business transaction support, online edit Extranet elf-service opportunities for customers, 2 Facimile Worldwide paperless faxing Interactive whiteboards Virtual meetings, virtual teams Intercast Multimedia service(PC/ V/Internet) Internet telephon Cheaper phone calls Intranets Newsgroups Electronic discussion group or bulletin board (usenet) Remote work Videoconferencing over IP Expanded participation in virtual meetings Web advertising Online marketing Wireless IP over cellular networks Mobile office, financial transaction, telemetry, transportation, Internet access WwW Use of HTML forms to convey, move, add, change information, asset management via central console ments, images, video, and sound. Information ies (Bower, 1970: Quinn, 1985). These factor linked together in a hypermedia system. Requires nclude organizational policies and other paradigmatic browsers to view web documents and navigate activities related to the attributes of particular inno- hrough the web structure. Utilizes search engines and vations that influence how much importance is actu- directories for organizing information. Links to publi ally placed on fast product development and private domains, the latter protected with pass- 2. Initiation: The initiation "stage"of innovation is words and firewalls characterized by knowledge-generation activities where situatio defined and ideas are propose The second dimension of the e-R&D model is major Initiation consists of all activities pertaining R&D process activities. This builds on the previous dis- recognition of a performance gap or unexploited cussion of the Internet-R&d outcome relationshi opportunity, diagnosis and definition of the need or Here, I map specific Internet attributes to specific R&D opportunity, search for relevant information, gener- activities in order to develop a more sophisticated assess- ation of ideas and alternatives, and development of ment of the research questions. That is to say, one can alternatives and prototype solutions. Thus, in this look for relationships between delineated tool-sets(of early stage, organizations pursue technical success the Internet) and isolated task-sets(of the r&d team (creativity) by transforming money into ideas process). To this point, I examine several categories of 3. Implementation: The implementation"stage"of inno- R&D activities and document how real companies facili on is characterized by knowledge-applica tate r&D-oriented group processes by using the Internet activities where the selected ideas and prototypes are Consider for instance some of the ways that firms are integrated or captured into the organization and put applying the Internet to various R&D sets of activities- into practice. Implementation consists of all activities see Table 2 pertaining to the transition of the innovation ideas to These r&D activities can be simplified and condensed profit-generating entities, utilization of the innovation into the following four general categories of stages or to achieve its intended objectives, and institutionalize- task sets(Burns and Stalker, 1961, Daft, 1982, Kessler ation of the innovation. Thus, in this later stage, and Chakrabarti, 1996; Roberts, 1988: Spender and organizations pursue business success(exploitation) Kessler, 1992) by transforming ideas into money 1. Pre-development: Pre-development activities relate to The third dimension is major outcomes of R&D the strategic orientation of a project and provide the Specifically, I look at how Internet-driven networks, via guidance and broad objectives for development activi- their impact on R&D activities, affect critical team pro-

910 E.H. Kessler / Technovation 23 (2003) 905–915 Table 1 Major Internet attributes Internet attribute Examples Business-messaging Calendar/scheduling, document management, line-of-business applications, workflow management, supply-chain management, fax routers Call centers Telemarketing, customer service Chat Address book, alias support, audio conferencing, channel filtering, client-to-client protocol, colored text, encryption, whiteboard, yellow pages Client server network Global enterprise solutions Data warehousing Remote access and storage Distance learning Education/training E-commerce Product and service sales, online banking Electronic data interchange Business transaction support, online editing Extranet Self-service opportunities for customers, 24/7 availability Facimile over IP Worldwide paperless faxing Interactive whiteboards Virtual meetings, virtual teams Intercast Multimedia service (PC/TV/Internet) Internet telephony Cheaper phone calls Intranets Privacy, security Newsgroups Electronic discussion group or bulletin board (usenet) Telecommuting Remote work Videoconferencing over IP Expanded participation in virtual meetings Web advertising Online marketing Wireless IP over cellular networks Mobile office, financial transaction, telemetry, transportation, Internet access WWW Use of HTML forms to convey, move, add, change information, asset management via central console ments, images, video, and sound. Information is linked together in a hypermedia system. Requires browsers to view web documents and navigate through the web structure. Utilizes search engines and directories for organizing information. Links to public and private domains, the latter protected with pass￾words and firewalls. The second dimension of the e-R&D model is major R&D process activities. This builds on the previous dis￾cussion of the Internet–R&D outcome relationship. Here, I map specific Internet attributes to specific R&D activities in order to develop a more sophisticated assess￾ment of the research questions. That is to say, one can look for relationships between delineated tool-sets (of the Internet) and isolated task-sets (of the R&D team process). To this point, I examine several categories of R&D activities and document how real companies facili￾tate R&D-oriented group processes by using the Internet. Consider for instance some of the ways that firms are applying the Internet to various R&D sets of activities— see Table 2. These R&D activities can be simplified and condensed into the following four general categories of stages or task sets (Burns and Stalker, 1961; Daft, 1982; Kessler and Chakrabarti, 1996; Roberts, 1988; Spender and Kessler, 1992): 1. Pre-development: Pre-development activities relate to the strategic orientation of a project and provide the guidance and broad objectives for development activi￾ties (Bower, 1970; Quinn, 1985). These factors include organizational policies and other paradigmatic activities related to the attributes of particular inno￾vations that influence how much importance is actu￾ally placed on fast product development. 2. Initiation: The initiation “stage” of innovation is characterized by knowledge-generation activities where situations are defined and ideas are proposed. Initiation consists of all activities pertaining to the recognition of a performance gap or unexploited opportunity, diagnosis and definition of the need or opportunity, search for relevant information, gener￾ation of ideas and alternatives, and development of alternatives and prototype solutions. Thus, in this early stage, organizations pursue technical success (creativity) by transforming money into ideas. 3. Implementation: The implementation “stage” of inno￾vation is characterized by knowledge-application activities where the selected ideas and prototypes are integrated or captured into the organization and put into practice. Implementation consists of all activities pertaining to the transition of the innovation ideas to profit-generating entities, utilization of the innovation to achieve its intended objectives, and institutionaliz￾ation of the innovation. Thus, in this later stage, organizations pursue business success (exploitation) by transforming ideas into money. The third dimension is major outcomes of R&D. Specifically, I look at how Internet-driven networks, via their impact on R&D activities, affect critical team pro-

E.H. Kessler/Technovation 23(2003)905-915 911 Table 2 Internet-networks and major R&D activities R&D activities Examples Getting concepts and ideas Sonera(the leading Finnish wireless carrier) uses the web to monitor customers' activities and lifestyle needs Procurement from suppliers Dell uses the web to coordinate production with vendors. Cisco puts its sales-and-inventory tracking system on the web to coordinate efforts with suppliers Basic engineering Maritime Telephone and Telegraph uses a knowledge oriented development process for storing information (specifications, projections, etc. ) Nortel Networks has development teams share ideas and documents on private web sites. P&G set up private sites to link engineers and researchers to draw "lightbulb moments Design of prototypes Ford is using the Internet to support CAD-CAM-CAE applications to design cars collaboratively with partners Simulation and testing Yahoo! puts early versions of their new services on-line for internal use only, allowing trials and tests Feedback from users expose technical flaws and soliciting suggestions for improved functiona\'S along to Marriott solicits guests' reviews over the Intemet. Amazon. com solicits us potential customer ramp-up and Zara uses the web to deliver fashion changes as fast as their customers demand them 20th Century Fox uses the Internet to market films and target and customize advertising Transactions and distribution Car Direct com allows customers to shop and purchase automobiles online. General Motors uses the Internet to link design centers with factory floors and dealerships to coordinate their work activities Boeing offers airlines web-based service that allows them access to technical information and private chat areas for discussing maintenance issues. Whirlpool is building net-linked appliances, for instance refrigerators that can automatically order food or machine settings that adjust settings for specific stains ject variables. Tracing the impact of how specific Inter- an e-R&D networked process. Moreover, there is evi- net attributes affect specific R&D activities enables us dence to suggest meaningful differences between to assess the importance of these relationships. I invoke internal and external knowledge flows within an R&D and adapt Clark (Clark and Fujimoto, 1991; Wheel- project as well as between memory-related knowledge wright and Clark, 1992)and Kessler(Kessler and Bierly, flows related to inter-project learning(Kessler et al 2001; Kessler and Chakrabarti, 1996)to propose the fol- 2001, 2000 ). Of course, a consideration of 108 relation- lowing three dimensions ships, or even 36 relationships if one assumes away the differences between knowledge-flow processes 1. Process speed: Innovation speed is the time elapsed beyond the scope and page constraints of this manu- between(a)initial development, including the con- script. Notwithstanding, we can still derive some broad- ception and definition of an innovation, and(b)ulti- based predictions about how such e-R&D networks mate commercialization which is the introduction of might function a new product into the marketplace. Thus, the concept In general, many of the Internet functions, such as of innovation speed refers to accelerating activities communication(by aiding in decision making), transfer from the first spark to the final product, including (by aiding in design processes), and access(by aiding activities that occur throughout the product-develop- in inter-project learning), could facilitate an e-R&d pro- ment process cess. This potentiality exists by virtue of the character 2. Project efficiency: Efficiency is a function of the rela- istics of the technology fitting the nature of the r&D- tive cost of development, defined as the total financial oriented group process task requirements. However, requirements and associated human resources needed some functions may be more beneficial than others due to complete the project as compared to the scope, size, to the greater richness of information exchanges they and objectives of the project enable(e. g, chat >facsimile). R&D, given that its nat- 3. Product quality: Product quality, or its "fitness of use ure is to process ideas and technologies that are rela the degree to which it satisfies customer require- tively new to the focal organization, is more likely to be ments relative to the scope, size, and objectives of better suited to richer channels of communication(Daft the project. and Lengel, 1984) Hypothesis 3a. The Internet can be used to positively The outcome of this modeling process yields a 4 3 affect the outcomes of the r&d process; richer functions x 3 model with 36 discrete and testable relationships of the Internet will have a greater effect on the outcomes represented by its cells. Table 3 graphically illustrates of the R&D process this, with Internet attributes along its height, R&D pro- Additionally, some functions may be better able to cess stages its width, and R&D outcomes its depth facilitate one outcome more so than another. For From Table 3, we can explore each cell to deduce and instance, chat and email(by enabling accelerated infor- predict relationships for each type of knowledge flow mation exchanges between remote teams and members)

E.H. Kessler / Technovation 23 (2003) 905–915 911 Table 2 Internet-networks and major R&D activities R&D activities Examples Getting concepts and ideas Sonera (the leading Finnish wireless carrier) uses the web to monitor customers’ activities and lifestyle needs Procurement from suppliers Dell uses the web to coordinate production with vendors. Cisco puts its sales-and-inventory tracking system on the web to coordinate efforts with suppliers Basic engineering Maritime Telephone and Telegraph uses a knowledge oriented development process for storing information (specifications, projections, etc.). Nortel Networks has development teams share ideas and documents on private web sites. P&G set up private sites to link engineers and researchers to draw “lightbulb moments” Design of prototypes Ford is using the Internet to support CAD-CAM-CAE applications to design cars collaboratively with partners Simulation and testing Yahoo! puts early versions of their new services on-line for internal use only, allowing trials and tests to expose technical flaws and soliciting suggestions for improved functionality Feedback from users Marriott solicits guests’ reviews over the Internet. Amazon.com solicits users’ reviews to pass along to potential customers Integrated ramp-up and Zara uses the web to deliver fashion changes as fast as their customers demand them production Marketing 20th Century Fox uses the Internet to market films and target and customize advertising Transactions and distribution CarDirect.com allows customers to shop and purchase automobiles online. General Motors uses the Internet to link design centers with factory floors and dealerships to coordinate their work activities User service Boeing offers airlines web-based service that allows them access to technical information and private chat areas for discussing maintenance issues. Whirlpool is building net-linked appliances, for instance refrigerators that can automatically order food or machine settings that adjust settings for specific stains ject variables. Tracing the impact of how specific Inter￾net attributes affect specific R&D activities enables us to assess the importance of these relationships. I invoke and adapt Clark (Clark and Fujimoto, 1991; Wheel￾wright and Clark, 1992) and Kessler (Kessler and Bierly, 2001; Kessler and Chakrabarti, 1996) to propose the fol￾lowing three dimensions: 1. Process speed: Innovation speed is the time elapsed between (a) initial development, including the con￾ception and definition of an innovation, and (b) ulti￾mate commercialization, which is the introduction of a new product into the marketplace. Thus, the concept of innovation speed refers to accelerating activities from the first spark to the final product, including activities that occur throughout the product-develop￾ment process. 2. Project efficiency: Efficiency is a function of the rela￾tive cost of development, defined as the total financial requirements and associated human resources needed to complete the project as compared to the scope, size, and objectives of the project. 3. Product quality: Product quality, or its “fitness of use” is the degree to which it satisfies customer require￾ments relative to the scope, size, and objectives of the project. The outcome of this modeling process yields a 4 × 3 × 3 model with 36 discrete and testable relationships represented by its cells. Table 3 graphically illustrates this, with Internet attributes along its height, R&D pro￾cess stages its width, and R&D outcomes its depth. From Table 3, we can explore each cell to deduce and predict relationships for each type of knowledge flow in an e-R&D networked process. Moreover, there is evi￾dence to suggest meaningful differences between internal and external knowledge flows within an R&D project as well as between memory-related knowledge flows related to inter-project learning (Kessler et al., 2001, 2000). Of course, a consideration of 108 relation￾ships, or even 36 relationships if one assumes away the differences between knowledge-flow processes, is beyond the scope and page constraints of this manu￾script. Notwithstanding, we can still derive some broad￾based predictions about how such e-R&D networks might function. In general, many of the Internet functions, such as communication (by aiding in decision making), transfer (by aiding in design processes), and access (by aiding in inter-project learning), could facilitate an e-R&D pro￾cess. This potentiality exists by virtue of the character￾istics of the technology fitting the nature of the R&D￾oriented group process task requirements. However, some functions may be more beneficial than others due to the greater richness of information exchanges they enable (e.g., chat facsimile). R&D, given that its nat￾ure is to process ideas and technologies that are rela￾tively new to the focal organization, is more likely to be better suited to richer channels of communication (Daft and Lengel, 1984). Hypothesis 3a. The Internet can be used to positively affect the outcomes of the R&D process; richer functions of the Internet will have a greater effect on the outcomes of the R&D process. Additionally, some functions may be better able to facilitate one outcome more so than another. For instance, chat and email (by enabling accelerated infor￾mation exchanges between remote teams and members),

E.H. Kessler/Technovation 23(2003)905-915 Product Quality Project efficienc Remote Connection File transfer Information Access Pre-Development Initiation Table 3. 3D eR&D model might speed up R&D-oriented group processes. applied to R&D activities and that specific stages or task Examples of this would be FreeServe software, which sets can be isolated and identified as responsive to e- uses email to help its globally distributed teams of pro- R&D networks. However, it does not make distinctions grammers work on problems together, and Genevas between stages that are critically impacted vS stages that Grid Physics Network that helps scientists collaborate are minimally impacted. In other words, we cannot in real-time with other researcher(Hafner, 2001). Others, deduce from it the magnitude of leverage provided by such as business messaging(by increasing the use of the Internet. Notwithstanding, some stages may indeed task and project management tools ), might make the pr be more elastic or responsive to e-R&D applications. For cesses less costly. For instance, Mclvor et al.(2000) instance, more responsive stages might include those reports that Internet technologies are being used to elim- types of activities which are more information-intense inate and augment R&D activities to improve part stan- and that depend on more networked communication. It dardization and simplification as well as part exclusion. also stands to reason that some stages of the R&d pro- Still others functions, such as extranet(by gaining part- cess would be better facilitated by the application of ner and user input), might help to produce higher quality some Internet attributes as compared to other Internet products. For example, Equity Marketing, the company attributes. These activities could include design and that designs many of the promotional products given feedback, as evidenced by Suns Sun Community Source away by burger King, has leveraged Internet-enabled License(SSCL) that leverages the Internet to promote prototyping processes to send three-dimensional product common-interest gated communities, and simulation and models to colleagues around the world to improve cus- testing, as evidenced by IBMs"Alpha Works"Internet tomization and performance(Kirsner, 2001). Of course, based discussion forums( Sawhney and Prandelli, 2000) these advantages would be better leveraged by organiza- Moreover, and even more specifically, a particular Inter tions rich in Internet-based competencies and impeded net functionality(e.g, Interactive whiteboards) might by those possessing a poorer understanding and usage particularly well fit a particular R&D task(e.g, basic of Internet functions. This is suggested by Maccoby engineering). These arguments combine to support finer (2001)and Warner and Witzel(1999), who speak of the grained, contingency relationships as compared to over growing new breed of technologically sophisticated and arching main effects network competent project managers Hypothesis 3c. The Internet has the potential to posi- Hypothesis 3b. The Internet has the potential to posi- tively affect all stages of the R&d process; various Inter- tively affect all outcomes of the r&d process; various net functions will differentially affect different Internet functions will differentially affect different out depending on the fit between the functions riches comes depending on the fit between the functions the stages'information-intensity and networked-com- characteristics and the outcomes' demand munication requirements We can also take a broad-based view of the internets All in all, simultaneously examining the interaction of effects on the r&d process and its different stages. all dimensions of the 3D e-R&D model provides for Table 2 provides numerous and diverse evidence, albeit some interesting albeit complex predictions on these primarily case-based, to suggest that the Internet can be relationships. In general, we might expect that(a) some

912 E.H. Kessler / Technovation 23 (2003) 905–915 Table 3. 3D e-R&D model. might speed up R&D-oriented group processes. Examples of this would be FreeServe software, which uses email to help its globally distributed teams of pro￾grammers work on problems together, and Geneva’s “Grid Physics Network” that helps scientists collaborate in real-time with other researcher (Hafner, 2001). Others, such as business messaging (by increasing the use of task and project management tools), might make the pro￾cesses less costly. For instance, McIvor et al. (2000) reports that Internet technologies are being used to elim￾inate and augment R&D activities to improve part stan￾dardization and simplification as well as part exclusion. Still others functions, such as extranet (by gaining part￾ner and user input), might help to produce higher quality products. For example, Equity Marketing, the company that designs many of the promotional products given away by Burger King, has leveraged Internet-enabled prototyping processes to send three-dimensional product models to colleagues around the world to improve cus￾tomization and performance (Kirsner, 2001). Of course, these advantages would be better leveraged by organiza￾tions rich in Internet-based competencies and impeded by those possessing a poorer understanding and usage of Internet functions. This is suggested by Maccoby (2001) and Warner and Witzel (1999), who speak of the growing new breed of technologically sophisticated and network competent project managers. Hypothesis 3b. The Internet has the potential to posi￾tively affect all outcomes of the R&D process; various Internet functions will differentially affect different out￾comes depending on the fit between the functions’ characteristics and the outcomes’ demands. We can also take a broad-based view of the Internet’s effects on the R&D process and its different stages. Table 2 provides numerous and diverse evidence, albeit primarily case-based, to suggest that the Internet can be applied to R&D activities and that specific stages or task￾sets can be isolated and identified as responsive to e￾R&D networks. However, it does not make distinctions between stages that are critically impacted vs. stages that are minimally impacted. In other words, we cannot deduce from it the magnitude of leverage provided by the Internet. Notwithstanding, some stages may indeed be more elastic or responsive to e-R&D applications. For instance, more responsive stages might include those types of activities which are more information-intense and that depend on more networked communication. It also stands to reason that some stages of the R&D pro￾cess would be better facilitated by the application of some Internet attributes as compared to other Internet attributes. These activities could include design and feedback, as evidenced by Sun’s Sun Community Source License (SSCL) that leverages the Internet to promote common-interest gated communities, and simulation and testing, as evidenced by IBM’s “AlphaWorks” Internet￾based discussion forums (Sawhney and Prandelli, 2000). Moreover, and even more specifically, a particular Inter￾net functionality (e.g., Interactive whiteboards) might particularly well fit a particular R&D task (e.g., basic engineering). These arguments combine to support finer￾grained, contingency relationships as compared to over￾arching main effects. Hypothesis 3c. The Internet has the potential to posi￾tively affect all stages of the R&D process; various Inter￾net functions will differentially affect different stages depending on the fit between the functions’ richness and the stages’ information
intensity and networked
com￾munication requirements. All in all, simultaneously examining the interaction of all dimensions of the 3D e-R&D model provides for some interesting albeit complex predictions on these relationships. In general, we might expect that (a) some

E.H. Kessler/Technovation 23(2003)905-915 attributes of the Internet more than other attributes(b) References will have a greater potential to positively affect some outcomes of the r&d process more than other outcomes (c) at some stages of the r&d process more than other Alsene, E, 1999. The computer integration of the enterprise. IEEE stages. Also, we must remember that(d)these relation Transactions on Engineering Management 46(1)26 Andrews, F, 1999. It's not the product thats different, it's the process ips might differ depending on the type of knowledge New York Times December 15 flow to which the 3D e-R&D model is applied. Indeed Antonelli, C, Geuna, A, Steinmueller, W.E., 2000. Information and the permutations of potential hypotheses are quite large communication technologies and the production, distribution and For instance, one example would be that Transfer use of knowledge. International Journal of Technology Manage- 20.72 (function)may be particularly well suited to facilitate a Barua, A, Ravindran, S, Whinston, AB, 1997. Efficient select speedier execution(outcome)of the design of prototypes of suppliers over the Internet. Journal of Management Information (stage), but only in internal knowledge flows(type)that Systems 13(4),117-13 are already broadly familiar to relevant parties Bierly, P, Chakrabarti, A K., 1996. Technological learning, strategic flexibility, and new product development in the pharmaceutical dustry. IEEE Transactions on Engineering Management 43 3. Summary and conclusion 368-380. Bower, J L, 1970. Managing the resource process. This paper proposes a general knowledge-based University Press, Boston framework for understanding and testing the complex Brown, J.S., Duguid, P, 1991. Organizational learning and communi- interaction of Internet technology and r&d organization innovation. Organization Science 2(1), 40-57 and team processes. It identifies three distinct knowledge Burgelman, R.A., Rosenbloom, R.S., 1989. Technology strategy: an flows and develops a three-dimensional e-R&D frame evolutionary process perspective. Research on Technological Inno- work for understanding and exploring how Internet vation Management and Policy 4, 1-23 driven networks effect these flows. a diverse and frag- Burn. J. Barnett. M.1999. Communicating age in the vir. mented literature is reviewed and arguments are ual organization. IEEE Transactions on Professional Communi- cation42(4),215-22 developed that focus on several important issues per- Burns, T Stalker, G.M., 1961. The Management of Innovation. Tavis- tock Publications. London Specifically, the paper considers relationships between Clark,K, Fujimoto,T,1991.Product Development Performance.Har Internet attributes. R&D activities and R&D outcomes rard Business School Press. Bost Several lists and tables are compiled and applied to Cohen. WM nthal, D.A., 1990. Absorptive capacity: a new per- spective on learning and innovation. Administrative Science Quar better understand these relationships, and research erly35,128-152 hypotheses are derived and offered. This is a general Corbiltt, T, 1999. Developments in electronic commerce Credit Man- understanding of this growing area. The value added of Daft. gent June, 28-30 albeit necessary and important step in improving our 1982. Bureaucratic versus nonbureaucratic structure and conceptual development and modeling the theoretical the process of innovation and change. Research in the Sociology context of e-R&D networks is especially significant Daft, R L, Lengel, R.H., 1984. Information richness: A new approach the relatively embryonic and disconnected nature of the field LL, Staw, B M.(Eds ) Research in Organizational Behavior, 6 Of course. there is much work to be done to finetune AI Press, Greenwich, CT, pp. 191-233 nd empirically test this model. Hopefully, the foun- inivasan,V, 2000. The product concept testing using dation elaborated in the paper will be useful in facilitat Journal of Product Innovation ing progress in this area, and will be continuously modi- Damanpour, F, 1991. Organizational innovation: a meta-analysis of led as scientifically collected data emerge to help bridge cts of determinants and moderators. Academy of Management the gap between e-R&D's importance and its objective al34,555-590 understanding. Subsequent research could delve into K L, 1999. From shelf to cyberspace. American Demographics 1(9),42-43 specific aspects of the model and develop and test spe- Deise, M, Nowikow, C, King, P, Wright, A, 2000. Executives cific parts of it. For example, in the area of virtual product Guide to E-Business: From Tactics to Strategy. John Wiley, New development teams, one might explore how the different Internet attributes affect various stages of their r&D Deitz, D, 1997. New CAD architectures. Mechanical Engineering 119 process, and perhaps towards different strategic goals (3),16-20 Also, testing may establish a contingent functionality of Eisenhardt, K M, Tabrizi, B, 1995. Accelerating adaptive processes product innovation in the global computer industry, Administrative the Internet across knowledge flows. Perhaps it is more Science Quarterly 40, 84-110 functional for external knowledge networks and less so Finch, B.J., 1999. Internet discussions as a source for consumer pro- for memory-related ones. However, it is important that ement and quality information: an exploratory these and related scholarly efforts maintain explicit links Fiol, C M, Lyles, MA, 1985. Organizational learning. Academy of to the larger conceptual framework to build toward a Management Review 10, 803-813 collective understanding of this important phenomena Gardiner, P D, Ritchie, J.M., 1999. Project planning in a virtual world

E.H. Kessler / Technovation 23 (2003) 905–915 913 attributes of the Internet more than other attributes (b) will have a greater potential to positively affect some outcomes of the R&D process more than other outcomes (c) at some stages of the R&D process more than other stages. Also, we must remember that (d) these relation￾ships might differ depending on the type of knowledge flow to which the 3D e-R&D model is applied. Indeed, the permutations of potential hypotheses are quite large. For instance, one example would be that Transfer (function) may be particularly well suited to facilitate a speedier execution (outcome) of the design of prototypes (stage), but only in internal knowledge flows (type) that are already broadly familiar to relevant parties. 3. Summary and conclusion This paper proposes a general knowledge-based framework for understanding and testing the complex interaction of Internet technology and R&D organization and team processes. It identifies three distinct knowledge flows and develops a three-dimensional e-R&D frame￾work for understanding and exploring how Internet￾driven networks effect these flows. A diverse and frag￾mented literature is reviewed and arguments are developed that focus on several important issues per￾taining to an Internet-leveraged e-R&D process. Specifically, the paper considers relationships between Internet attributes, R&D activities, and R&D outcomes. Several lists and tables are compiled and applied to better understand these relationships, and research hypotheses are derived and offered. This is a general albeit necessary and important step in improving our understanding of this growing area. The value added of conceptual development and modeling the theoretical context of e-R&D networks is especially significant given the relatively embryonic and disconnected nature of the field. Of course, there is much work to be done to finetune and empirically test this model. Hopefully, the foun￾dation elaborated in the paper will be useful in facilitat￾ing progress in this area, and will be continuously modi- fied as scientifically collected data emerge to help bridge the gap between e-R&D’s importance and its objective understanding. Subsequent research could delve into specific aspects of the model and develop and test spe￾cific parts of it. For example, in the area of virtual product development teams, one might explore how the different Internet attributes affect various stages of their R&D process, and perhaps towards different strategic goals. Also, testing may establish a contingent functionality of the Internet across knowledge flows. Perhaps it is more functional for external knowledge networks and less so for memory-related ones. However, it is important that these and related scholarly efforts maintain explicit links to the larger conceptual framework to build toward a collective understanding of this important phenomena. 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