nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2009‒09‒11
seven papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Crossing innovation and product projects management: comparative analysis in the automotive industry. By Romain Beaume; Rémi Maniak; Christophe Midler
  2. The Launch of Innovative Product-Related Services: Lessons from automotive telematics By Sylvain Lenfle; Christophe Midler
  3. Digging into exploration processes within established firms: Insights from two entities dedicated to enhancing radical innovation to support existing business By Sihem Ben Mahmoud-Jouini; Florence Charue-Duboc; Sylvain Lenfle; Christophe Midler
  4. Developing Innovative Competences in an Emerging Business System: New Private Enterprises in Hangzhou’s Software Industry By Greeven, M.J.; Xiaodong, Z.
  5. The Financing of R&D and Innovation By Bronwyn H. Hall; Josh Lerner
  6. Incentives for Experimenting Agents By Johannes Horner; Larry Samuelson
  7. Conservation and Ecotourism in Brazil and Mexico: The Development Impact By David Ivan Fleischer

  1. By: Romain Beaume (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Rémi Maniak (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Christophe Midler (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X)
    Abstract: Projectification and platform approaches have been two main transformation trends implemented by industrial firms during the1990s. For those firms, innovation management no longer deals with introducing radically and totally new products, but rather withapplying innovative features within a regular stream of products and platforms. This paper proposes an analytical framework thatcan address the resulting interplay between innovative features and new products. This framework relies on the concept of innovationlife-cycle management (ILCM). The paper presents the early results from the comparison of five case studies from three OEMs.
    Keywords: Organizational learning; New product projects portfolio; Innovation management; Automotive industry; Comparative analysis.
    Date: 2009–02
  2. By: Sylvain Lenfle (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Christophe Midler (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X)
    Abstract: In the literature on new product development, most existing studies on the end of the design process concentrate on managing ramp-up in the field of manufactured products. This situation poses a problem at a time when our economies increasingly depend upon services and products are more and more related with sophisticated services that provides value for customers and producers. This article examines the management of the final phases of the design process of an innovative product-related service. Our research thus makes three contributions: 1) An analysis of the implementation process shows that the simultaneity of the production and consumption of a service means that three types of learning – technical, sales and uses – take place at the same time. Launch management strategies have thus to be adapted. 2) An analysis of the data collected confirms this difference by bringing to light great contrasts in these different aspects of learning. 3) This led us to identify a field that needs exploration by researchers in product and services innovation: the design of the sales process. Furthermore we underline two scenarios to manage the launch of innovative product-related services.
    Keywords: project management, Services, Automotive telematics, Product Launch, Ramp up, Innovation Management
    Date: 2009
  3. By: Sihem Ben Mahmoud-Jouini (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Florence Charue-Duboc (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Sylvain Lenfle (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X); Christophe Midler (CRG - Centre de recherche en gestion - CNRS : UMR7655 - Polytechnique - X)
    Abstract: Since the seminal work of J. March (1991), balancing exploration and exploitation activities is an important topic in management research. Though the literature is abundant on the management of exploitation activities, exploration activities remain a much less studied area. How should be compared and contrasted: exploration activity, R&D, new product development project and advance engineering? This is central to understand the specificities of exploration processes. In this paper we propose to dig into the exploration process based on the comparison between two case study researches. These longitudinal researches were conducted in two different firms in the automotive industry, one in a first tier supplier company (Ben Mahmoud-Jouini, Charue-Duboc and Fourcade2007), the second in an OEM company (Lenfle and Midler 2003). These two companies created an entity specifically in charge of exploring novel innovative opportunities in a specified but broad field. The mission of these entities was to identify novel opportunities that could support the existing business in changing or expanding their scope but not in creating an entirely new business. In order to dig into exploration processes, we propose to delineate more precisely the specificities of these exploratory entities. We stress three dimensions: (i) five characteristics of the “situation” the team of the exploratory entities face (the strategic issues raised, the purpose of the exploration, the type of results expected, the time span, the approach) (ii) five activities undertaken within the entities (creativity processes, external communication, interactions with the customer, formulation of a technological strategy, analysis of acquisition targets) (iii) and the organizational design that supported these activities. Based on these cases, we highlight an interplay between exploration and exploitation activities. Hence, on the one hand the exploratory entity relies largely on the competences and expertise located in the existing business of the firm on the other hand the entity develops new knowledge either on technology new to the company or on market that are useful for the established divisions of the company and used by them. We raise the question of the evolution of the boundaries between exploratory entities and the rest of the firm across time, which remains open in the literature. Hence, exploratory entities are not necessarily designed to develop innovative products up to their commercialization. Rather the latest phases of new product development can be transferred to more exploitative entities.
    Keywords: creativity, Automotive Industry, Innovation Management, exploration
    Date: 2009–06
  4. By: Greeven, M.J.; Xiaodong, Z. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: What kind of innovative competences are credibly developed by private entrepreneurs in China’s transition economy? On the basis of original empirical fieldwork in 45 software enterprises in Hangzhou, Zhejiang Province, we propose a working theory of innovative competence development in an emerging private sector. Combining resource-based and institutional perspectives we argue that Chinese private enterprises in Hangzhou were able to develop unique innovative competences to overcome resource constraints and manage technical - and market risks while respecting the location and sector-specific constraints. The findings suggest that private software enterprises in Hangzhou developed five innovative competences: organizational integration, financial commitment, external knowledge transformation, reputation development and strategic flexibility. The analysis further allows to propose three implications: 1) These five competences form a ‘configuration’ or coherent set of competences in this particular institutional setting; 2) Technological – and institutional regimes shape the potential range of innovative competences firms credibly develop depending on the available resources of the firm; 3) Innovative competences can be functional equivalents of institutions in the absence of well-developed, mature formal institutions.
    Keywords: private entrepreneurs;innovation;China;software industry;institutions;competences;business system
    Date: 2009–08–08
  5. By: Bronwyn H. Hall; Josh Lerner
    Abstract: Evidence on the “funding gap“ for investment innovation is surveyed. The focus is on financial market reasons for underinvestment that exist even when externality-induced underinvestment is absent. We conclude that while small and new innovative firms experience high costs of capital that are only partly mitigated by the presence of venture capital, the evidence for high costs of R&D capital for large firms is mixed. Nevertheless, large established firms do appear to prefer internal funds for financing such investments and they manage their cash flow to ensure this. Evidence shows that there are limits to venture capital as a solution to the funding gap, especially in countries where public equity markets for VC exit are not highly developed. We conclude by suggesting areas for further research.
    JEL: G24 G32 O32 O38
    Date: 2009–09
  6. By: Johannes Horner (Cowles Foundation, Yale University); Larry Samuelson (Cowles Foundation, Yale University)
    Abstract: We examine a repeated interaction between an agent, who undertakes experiments, and a principal who provides the requisite funding for these experiments. The agent's actions are hidden, and the principal, who makes the offers, cannot commit to future actions. We identify the unique Markovian equilibrium (whose structure depends on the parameters) and characterize the set of all equilibrium payoffs, uncovering a collection of non-Markovian equilibria that can Pareto dominate and reverse the qualitative properties of the Markovian equilibrium. The prospect of lucrative continuation payoffs makes it more expensive for the principal to incentivize the agent, giving rise to a dynamic agency cost. As a result, constrained efficient equilibrium outcomes call for nonstationary outcomes that front-load the agent's effort and that either attenuate or terminate the relationship inefficiently early.
    Keywords: Experimentation, Learning, Agency, Dynamic agency, Venture Capital, Repeated principal-agent problem
    JEL: D8 L2
    Date: 2009–09
  7. By: David Ivan Fleischer (International Policy Centre for Inclusive Growth)
    Abstract: Conservation projects alter local productive modes and have an impact on livelihoods. For example, sea turtle conservation projects affect fishing communities through hunting restrictions. It is not painless for communities to improve fishing technology in order to prevent the accidental capture of sea turtles. The inability to adapt to environmental requirements forces fishermen to abandon traditional livelihoods. A combination of environmental conservation and ecotourism development can provide the solution. (...)
    Keywords: Conservation and Ecotourism in Brazil and Mexico: The Development Impact
    Date: 2009–09

This nep-ppm issue is ©2009 by Arvi Kuura. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.