Secondly, in the electronics industry, it is important for companies to decide whether they should perform a certain value creation activity by themselves or outsource it to another firm (Parmigiani, 2007). However, in order to reduce labour costs, companies often choose to outsource the task. The company assigns the task to outside professionals who can offer increased efficiencies and economies of scale reducing the company’s internal costs and mitigating the risk of failure. For example, in the electronics industry, many companies have been outsourcing some parts of the software development process, such as testing computer code written in the United States, to independent providers based in India (Charles W.L. Hill).
Thirdly, to achieve …show more content…
The members of the functional team are temporarily transferred from their various departments to form a temporary department. The functional team structure works well for small teams and small projects, as it is flexible and it can reduce the cost of time. However, in the functional team structure, there is no formal project manager, so the members’ sense of responsibility is not strong, and one of the disadvantages of this type of team structure is that the different functional groups may not communicate effectively with one another. Thus, the time spent on it should be no more than 10% (Schilling). Finally, the results may be less than expected. The functional team structure is generally used to solve existing problems, such as issues uncovered through customer …show more content…
Open innovation
As the pace of reform and transformation is extremely fast in the electronics industry, open innovation is very important for an electronics company attempting to gain market competitiveness in the industry. To be more specific, open innovation has some advantages, such as reducing costs and mutual cooperation which can improve visibility.
Open innovation can be discussed from following aspects. Firstly, with open innovation, firms can have a deep understanding of their business and firms in the same industry can learn from each other. For instance, through knowledge exchange, which is the combination and recombination of existing knowledge (Pisano and Teece, 2007). Thus, firms can develop and highlight their own advantages, and increase their market share.
Secondly, open innovation can improve communication and coordination with suppliers which can result in more favourable prices, thereby reducing the firm’s production costs. According to Gassmann (2004), suppliers are a good source for enriching a company’s knowledge. Few people outside the company know its products or processes better than its suppliers, which means suppliers have a positive influence on the success of the company (Brem,
Thirdly, to achieve …show more content…
The members of the functional team are temporarily transferred from their various departments to form a temporary department. The functional team structure works well for small teams and small projects, as it is flexible and it can reduce the cost of time. However, in the functional team structure, there is no formal project manager, so the members’ sense of responsibility is not strong, and one of the disadvantages of this type of team structure is that the different functional groups may not communicate effectively with one another. Thus, the time spent on it should be no more than 10% (Schilling). Finally, the results may be less than expected. The functional team structure is generally used to solve existing problems, such as issues uncovered through customer …show more content…
Open innovation
As the pace of reform and transformation is extremely fast in the electronics industry, open innovation is very important for an electronics company attempting to gain market competitiveness in the industry. To be more specific, open innovation has some advantages, such as reducing costs and mutual cooperation which can improve visibility.
Open innovation can be discussed from following aspects. Firstly, with open innovation, firms can have a deep understanding of their business and firms in the same industry can learn from each other. For instance, through knowledge exchange, which is the combination and recombination of existing knowledge (Pisano and Teece, 2007). Thus, firms can develop and highlight their own advantages, and increase their market share.
Secondly, open innovation can improve communication and coordination with suppliers which can result in more favourable prices, thereby reducing the firm’s production costs. According to Gassmann (2004), suppliers are a good source for enriching a company’s knowledge. Few people outside the company know its products or processes better than its suppliers, which means suppliers have a positive influence on the success of the company (Brem,