Dr. Michael D. Michalisin, professor of management at Penn State Worthington Scranton, recently had a research paper presented at The 4th Annual Conference of the Academy of Innovation and Entrepreneurship.
Dr. Michalisin, who also serves as the coordinator of Worthington Scranton's business program, was a collaborator on the research project presented earlier this month in Beijing, China.
The paper, "A New Breed of Suppliers for Product Innovations: A Content-Analytic Case Study" was co-written with Dr. Chanchai Tangpong of North Dakota State University; Dr. Arlyn D. Melcher, of Southern Illinois University; and Dr. Kuo-Ting Hung, of Suffolk University.
The literature states that the ability to innovate new products and services is becoming increasingly essential to firms' survival and prosperity in the turbulent environment of today's new economy, and that relationalism (i.e., cooperative and relational behavior) between buyer firms and suppliers can play an important role in enhancing buyer firms' product innovations.
However, the current research, a content-analytic case study of eight U.S. computer companies (Hewlett-Packard, Compaq, Dell, Gateway, Sun Microsystems, Apple Computer, Silicon Graphics, and Micron Electronics) over three observation periods (1993-1994, 1995-1996, and 1997-1998), indicates that suppliers' dependence on the buyer firm hinders their ability to contribute to the buyer firm's product innovation; even when relationalism in their exchange relationships is high.
The implication is that buyer firms can optimize supplier contributions to their product innovation in today's fast changing business landscape by identifying and forging relationships with a new breed of suppliers that are willing to develop strong cooperative and relational ties with the buyer firms, while maintaining requisite levels of independence.
This is contrary to traditional economic logic that large buyer firms should aim to reduce transaction costs and maximize profits by leveraging their high bargaining power in negotiating prices that ultimately reduce the profit margins of highly dependent suppliers.
The short-term profitability reaped by such opportunistic buyer firms can undermine their long-term competitiveness over time if they impair the innovative resources and capabilities of key strategic partners -- their suppliers.
Dr. Michalisin obtained his Ph.D. in strategic management and macro-organizational theory from Kent State University, an MBA in Finance from Duquesne University, a B.S. in accounting from The Pennsylvania State University, and is a licensed certified public accountant.
In addition to his academic experience he has worked in industry at Ernst and Young, LLP, Westinghouse, and Finalco Group, Inc. His main research interests include the Resource-Based View of the Firm, Business and Environmental Sustainability, Top Management Team Dynamics, and Strategic Entrepreneurship, among others.
