Digitalisation of Development and Supply Networks: Sequential and Platform-Driven Innovations

Abstract

We draw from an eight-year dataset of 98 organisational entities involved in pre-competitive innovation networks across the UK pharmaceutical sector. These data map into three networks that are representative of: (i) a product development-led sequential pathway that begins with digitalised product development, followed by digitalisation of supply networks, (ii) a supply network-led sequential pathway that starts with digitalised supply networks, followed by digitalisation of product development, and (iii) a parallel — platform-driven — pathway that enables simultaneous digitalisation of development, production, and supply networks. We draw upon extant literature to assess these network structures along three dimensions — strategic intent, the integrative roles of nodes with high centrality, and innovation performance. We conduct within-case and cross-case analyses to postulate 10 research propositions that compare and contrast modalities for sequential and platform-based digitalisation involving collaborative innovation networks. With sequential development, our propositions are congruent with conventional pathways for mitigating innovation risks through modular moves. On the other hand, we posit that platform-based design rules, rather than modular moves, mitigate the risks for parallel development pathways, and lead to novel development and delivery mechanisms.

Keywords: Design rules, Digitalisation, Network effect, Operations, Platforms, Product Development, Supply Chain Configuration