Information asymmetries and technological innovation in large engineering construction projects

Research on technological innovation shows that information asymmetries between suppliers and buyers constitute a major barrier to the successful introduction of new products. Most of this research, however, puts the burden of overcoming these asymmetries on producers of new products. In the case of large engineering construction projects innovation is often the result of joint problem solving by owners, prime contractors, consultants, and equipment suppliers. In this paper we examine the relationship between innovativeness of large engineering construction projects and internal owner capabilities, degree of control over project, and dependence on external organizations, We use data on power plant construction projects to test hypotheses derived from agency and organization theories of innovation. Our results indicate that organization theories of innovation are on the whole better predictors of the impact on innovativeness of owner's capabilities and relationship to external organizations.     

Impact of owner involvement on innovation in large projects: Lessons from power plants construction

Innovation in complex engineering projects is hampered by information asymmetries which attend joint problem solving by owners and external organizations. This uncertainty creates additional informational asymmetries between owners and firms engaged in designing, building, and supplying projects. Industrial marketing suggests that overcoming these asymmetries is easier when owners are knowledgeable and part of the design process. We examine whether the same proposition holds for innovation in complex engineering projects. We focus on the relationship between innovativeness of complex engineering projects and internal owner capabilities. We test hypotheses derived from agency and organization theories of innovation. Our results indicate that projects where owners have internal capabilities are generally less innovative than projects where owners lack internal capabilities.     

An exploratory comparison of the management of innovation in the New and Old economies

This paper uses a combination of grounded theorising and exploratory quantitative analysis to compare the patterns of organising and managing innovation in the New and Old Economies. The results show that firms in the NE put in place structures and processes that give the R&D function a more strategic position, link it directly to customers and accelerate innovation throughput inside the firm.     

EU-Russian Border Crossing: The Dialogical Perspective

Mainstream post-positivist approaches to Border Studies typically represent national borders as losing their importance or blurring. This insight usually fails to grasp the perspective of those who have to cross ‘hard’ borders, for whom these borders are primarily ‘hard facts’ quite precisely restricting territorial limits of their movement. Aiming to take this perspective and practical problems experienced by such border crossers into account, the author proposes an approach focusing on communication between those who cross ‘hard’ borders and those who protect these borders. The case of the EU-Russian border shows that border crossers have an increasing range of options to make themselves heard by their own country's officials, though it is much more difficult for them to reach gatekeepers and public on the other side of the border without resorting to intermediaries (such as their states or business actors). The author suggests that border crossers could be heard better if cross-border cooperation initiatives would prioritise this purpose thus making the EU's external borders not only ‘friendly’ or ‘blurred’ but also ‘dialogic’.     

Using R&D portfolio management to deal with dynamic risk

We develop a theoretical framework for understanding why firms adopt specific approaches for the management of innovation project portfolios. Our theory focuses on a key contingency factor for innovation, namely the dynamics of competitive environments. We use four dimensions to characterize the patterns of environmental dynamics: velocity, turbulence, growth and instability. The paper then proposes the concept of dynamic risk as a determinant of portfolio management processes. Dynamic risk results from second‐order learning by a firm confronted with a specific dynamic pattern in its environment. This learning concerns the likely nature of threats and the required updating of cognitive frameworks in such environments. Attempts to deal with dynamic risk enable various actors inside the firm to understand what kind of dynamic capabilities are needed in their innovation portfolio management processes. As a result of this diffuse learning, firms tend to favor certain common characteristics in their concrete portfolio management activities. To advance the theorizing of these characteristics, the paper also proposes four dimensions of portfolio management: structure, commitment, emergence and integration. Based on arguments inspired by the dynamic capability and related literatures, we advance a series of hypotheses, that relate environmental dynamics dimensions and portfolio management dimensions. These hypotheses are tested based on a survey of 795 firms in a variety of sectors and on four continents, using original scales and structural equation modeling methods. The results show, among other findings, that high‐velocity environments favor structured as well as integrated portfolio management approaches, while high‐growth environments favor approaches that are structured but commit significant resources to each project as well. Turbulent environments favor approaches that are emergent, but also, contrary to our expectations, have high resource commitment levels. Finally, firms in unstable environments have a marginal preference for emergent approaches. Results could help advance the dynamic contingency theoretical perspective on dynamic capabilities, as well as improve the practice of innovation portfolio management.