relationships as source of innovations in advertising industry: comparative study of polish and...
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RELATIONSHIPS AS SOURCE OF INNOVATIONS IN ADVERTISING INDUSTRY
COMPARATIVE STUDY OF POLISH AND JAPANESE APPROACHES
Y. Hara, K. Hosoi,G. Leszczyński, M. Zieliński
Combining the Social and Technological Aspects of Innovation: Relationships and NetworksThe 28th IMP Conference
Thursday, September 13, 2012
Polish approach?
Japanese approach?
RELATIONSHIPS AS A SOURCE OF INNOVATIONS IN ADVERTISING INDUSTRY
Thursday, September 13, 2012
STARTING POINT
•Traditional approach to innovation process places the source of ideas inside the company while open innovation approach treats customer as an external source of new ideas for the company (Von Hippel, 1978, Hyland et al., 2006, Chesborough 2003, Bjork and Magnusson 2009).
• Process of innovation requires collaboration of actors, activities and resources at intra- and inter-firm levels (Rothwell 1994).
• That concept is based on well established relationships, which, in turn, require trust between the company and the partners with whom it cooperates for innovation. Mutual trust between partners is on the top of the list of factors that affect performance of collaboration (Gulati, 1995, Dyer and Hatch, 2004)
• However sometimes distrust is usual.
Thursday, September 13, 2012
SCOPE OF THE STUDY
PurposeThe main reason for taking this subject have been concerns raised by managers in relation to the possible use of customer relationships in the exploration and development of innovation in service companies. Therefore the paper deals with the issue of low innovativeness of Polish service companies.
Literature addressedThe impact of external actors on innovation of the company was discussed in the literature related to new product development (Wuyts et al., 2004), innovation (Laursen & Salter, 2006), business-to-business relationships (Håkansson et al., 2009; Chen et al. in 2011; Salunke et al. 2011). The recognized contribution of services to economic growth contributed to the studies of innovation within services (de Jong et al., 2003; Hauknes, 1998; Howells & Tether, 2004; Miles, 2005). However the impact of distrust relationships on collaboration with customer still needs clarification.
Advertising companiesAdvertising companies were chosen for that study because this industry is defined as a “co-creation service” one, where a high level of participation of the customer is required to create the service and the service itself is advisory and problem-solving (Bolton and Saxena-Iyer, 2009).
Thursday, September 13, 2012
SERVICE INNOVATIONAa and Elfring (2002) define service innovation as: new combination of services or service elements, reproduction of service, involvement of customer, adoption of technology.
Mager and Sangiorgi (2005) suggest 3 dimensions of service innovation: • market - pricing and offering strategies are developed• organizational and production - processes and organizational models are invented• relational - the social and cultural aspects of service experience include the users’
perspective
The presumed advantage of collaborating with customers for service innovation relates to:generation of service ideas and information about user requirements
• comments on new concepts• assistance on development and testing of prototypes • assistance in diffusion (Chen et al. 2011)
We are focused on cases of involvement of customer, inclusion of his perspective and integration of new knowledge in innovation process in advertising companies.
Thursday, September 13, 2012
RESEARCH FRAMEWORKAn open innovation model directs our attention to:
• Social capital of advertising companies that is created by the sum of the actual and potential resources embedded within, available through and derived from the network of relationships possessed by an individual or social unit (Nahapiet and Ghoshal 1998).Parties that have high social capital should exchange information more easily and with bigger number of parties (Wu et al 2008)
• Learning orientation, which allows incorporation of the innovative potential inherent in the relationships. Innovative companies are characterized by openness to comments and recommendations from the environment, particularly communicated by customers (Kanter 1988).
Both inter- and intra-organizational cooperation needs relationships based on trust because it enables sharing of information. The impact of trust/distrust on social capital and learning orientation is discussed.
Thursday, September 13, 2012
METHODLOGYCASE STUDY IN TWO COUNTRIES
Thursday, September 13, 2012
METHODLOGYCASE STUDY IN TWO COUNTRIES
Ad industryFocal point is:•Trust•Learning orientation•Social capital•Innovation process
Thursday, September 13, 2012
METHODLOGYCASE STUDY IN TWO COUNTRIES
Ad industryFocal point is:•Trust•Learning orientation•Social capital•Innovation process
1.Interviews in Poland (Case 1&2) 1.Interviews in Japan (Case 3)
Thursday, September 13, 2012
METHODLOGYCASE STUDY IN TWO COUNTRIES
Ad industryFocal point is:•Trust•Learning orientation•Social capital•Innovation process
1.Interviews in Poland (Case 1&2) 1.Interviews in Japan (Case 3)
Thursday, September 13, 2012
METHODLOGYCASE STUDY IN TWO COUNTRIES
2.Discussing on Japanese case 2.Discussing on polish case
Ad industryFocal point is:•Trust•Learning orientation•Social capital•Innovation process
1.Interviews in Poland (Case 1&2) 1.Interviews in Japan (Case 3)
Thursday, September 13, 2012
CONTEXT
Poland
• transition → market economy
• services: 54,5% of GDP
• one of lowest level of innovation among OECD countries, below EU average
• lowest trust and collaboration among EU countries
• Polish managers expect quick results of their actions because of the short-term orientation
Japan
• market economy
• services: 75,7%
• one of the most innovative economies
• focused on giving and receiving results in a long time
Thursday, September 13, 2012
CASE 1
Opportunities
short time relationshipslack of trust
Customer is not perceived as a source of innovation
exploitative learning orientation
Thursday, September 13, 2012
CASE 1
Opportunities
short time relationshipslack of trust
Customer is not perceived as a source of innovation
exploitative learning orientation
Thursday, September 13, 2012
CASE 2
Customer is kept out of the process of innovation
lack of trustlack of faith in the customer’s knowledge
short time relationships
Thursday, September 13, 2012
CASE 2
Customer is kept out of the process of innovation
lack of trustlack of faith in the customer’s knowledge
short time relationships
Thursday, September 13, 2012
CASE 3
Thursday, September 13, 2012
CASE 3Clan
Thursday, September 13, 2012
CASE 3Clan
Always working with same Clan members
Thursday, September 13, 2012
CASE 3Clan
Always working with same Clan members
Thursday, September 13, 2012
CASE 3Clan
Always working with same Clan members
Foster trust
Thursday, September 13, 2012
CASE 3Clan
Always working with same Clan members
Foster trust
Thursday, September 13, 2012
CASE 3Clan
Always working with same Clan members
Foster trust
Incremental innovation
Thursday, September 13, 2012
CASE 3
Changing network
New knowledge
Radical innovation
Thursday, September 13, 2012
CASE 3
Changing network
New knowledge
Radical innovation
Outside Agent
Thursday, September 13, 2012
JAPANESE PERCEPTION OF POLISH APPROACH
Japanese respondents were surprised on distrustful relationship in Polish advertising industry. They said that they couldn’t create good works without the trust. Trust and cooperation with others is a basic and minimum request to do creative works in Japanese advertising industry.
lack of trust and loyalty
a lot of time is spent to define contract
linear and intra innovation process Thursday, September 13, 2012
POLISH PERCEPTION OF JAPANESE APPROACH
The Polish managers from both researched agencies were surprised by the importance of customer relationships that are the deciding factor in selection of the agency. Cooperation with thirds parties agencies is impossible in Polish circumstances. The Japanese concept of clans seems to be very interesting, however this solution may be difficult to transfer to Polish market
Personnel exchange (clans)
Foster the trust, contracts are not needed
Network model of innovationThursday, September 13, 2012
CONCLUSIONS• Customer is not regarded as a source of innovation in both countries, but his role is different due to
trust/distrust
• Customer role:
• in Poland at the beginning and at the end of process,
• in Japan - customer’s perspective included, customer involved in the process
• In polish ad agencies lack of trust limits the possibilities of collaboration with customer and other actors
• Reinforcement of trust needs time, so companies might focus on development of social capital or modification / development of their learning orientation
• Contracts should include elements of collaborations based on clans
• Further research on development of relationships without confidence is needed
• The presented observations are exploratory in nature, but they formed the basis to apply for a grant to Polish Ministry of Science
Thursday, September 13, 2012
THANK YOU
Thursday, September 13, 2012
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