Session | ||
MC5 - SCM3: R&D in supply chains
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Presentations | ||
The impact of operational transparency on R&D novelty 1University of Minnesota, Twin Cities; 2Johns Hopkins University Being operationally transparent is often misaligned with firms’ incentives. In such situations, regulators or industry watchdogs may impose operational transparency requirements on firms. In this study, we examine the impact of operational transparency on R&D novelty. Exploiting an exogenous shock in the US pharma industry, we show that increased transparency leads to less novel R&D bets. Our research not only contributes to operations management theory but also informs policy. More investment less profit? An R&D investment conundrum of a financially constrained firm in a supply chain 1University of Notre Dame, United States of America; 2The Chinese University of Hong Kong, Shenzhen A financial constraint for R&D is an essential issue for a firm's operations yet often ignored in research. We analyze a supply chain consisting of a supplier and a manufacturer, where the latter has an R&D opportunity with limited resources. We show that the latter's profit can decrease even if it can afford more investment, referred to as the R&D conundrum. We investigate operational and information strategies, including upfront R&D investment and keeping its financial budget private. Sequential versus concurrent product development: Approval uncertainty, time-sensitive consumption utility, and asymmetric competition 1Faculty of Business Administration, Bilkent University; 2Anderson School of Management, University of California, Los Angeles Concurrent development strategies can enable a firm to gain the first-mover advantage by developing a new product faster. However, they usually entail upfront investments that the firm cannot recoup if the product failed to meet certain quality requirements. Using a two-stage duopoly model, we examine under what conditions a firm will adopt concurrent development strategy in equilibrium in view of uncertain product approval, time-sensitive consumer utility, and asymmetric competition. |