Master’s Thesis:
How can the social structure contribute to the success of a
collaborative product development project?
MScBA Organisational & Management Control Supervisor: Prof. Dr. Jeltje van der Meer-Kooistra
Co-assessor: Dr. Andrea Bellisario
Emilia Benekos S3438325 Groningen, 25/06/18
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Abstract
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Acknowledgements
I have learned a lot writing my master’s thesis on an academic, scientific and personal level and I would like to reflect on those who have supported and helped me throughout this process.
Foremost, I would like to express my profound gratitude to my supervisor Prof. Jeltje van der Meer-Kooistra for the continuous support throughout the process, her patience and guidance of my master’s thesis. I sincerely appreciate the time she dedicated to me and her valuable insights on my research. I am grateful to her for advising and guiding me from very early in my research process until the final stage.
In addition, I would like to thank Prof. Jeltje van der Meer-Kooistra and Prof. Robert W. Scapens for sharing their research with me. Their notes and data made this thesis possible and I am very grateful. Finally, I would like to express my sincere appreciation to my parents, sister and loved ones for their wise counsel and sympathetic ear. They have provided me with unfailing support and continuous encouragement throughout my years of study and through the process of researching and writing this thesis, for which I am very grateful.
Thank you.
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1. Introduction
Technology is increasingly becoming more and more significant to every aspect of our everyday lives, therefore the need for new, more technologically efficient products is growing and the high-tech industry is booming. As a result, organisations find themselves having to invest more in product development (PD) in order to maintain a competitive advantage (Owens and Cooper, 2001). However, PD is surrounded by uncertainty and is complex, and companies need to manage all the risks involved and the high costs and minimize the time to market process (Büyüközkan and Arsenyan, 2012). As a result, many companies choose to collaborate in order to share those risks, improve quality and benefit from complementary knowledge (Littler et al. 1995, Noori and Lee 2004, Harmancioglu et al. 2007). An interesting aspect of the high tech industry is the importance of entry to market. Companies race to introduce a new technology or a new product to the market, and those who succeed get to associate their brand with innovation and increased market share. As a result, there is increased evidence that companies choose to collaborate, in order to beat their competitors in developing a new product, in modern, high-tech industries (Chesbrough, 2003; Faems et al., 2005; Hagedoorn, 2002).
According to Büyüközkan and Arsenyan (2012) collaborative product development (CPD) is: “a technology-centred process including two or more partners with diverse competence, experience, culture, skill and location joining complementary resources to design and develop new, innovative, improved products in order to gain competitive advantage, innovate, explore new markets, share risks and costs and accelerate the PD process…Collaboration may include only one phase of PD as well as the whole process from conceptual design to product launch” (2012, p. 48). CPD projects often take place in temporary organisations, a concept explored in a later section. Moreover, in the context of CPD four basic concepts were described by Lundin and Söderholm (1995); those were time, task, team and transition. However important to this thesis is the concept of team, which refers to the interpersonal relationships through which the tasks are undertaken (Lundin and Söderholm,1995) and will be described in more detail later on in the section of social structures.
It becomes clear that in CPD projects there is increased complexity when it comes to dealing with governance issues, and from this context, the concept of minimal structures has emerged. Kamoche and Cunha (2001) were the first to explore this concept and discussed PD within an organisation. They argued that combining a social structure and a technical structure can provide a structure for guiding the process of the PD and leave room for creativity and innovation (Kamoche and Cunha, 2001). Building on this, van der Meer-Kooistra and Scapens (2008) developed the notion of minimal structures to provide firmness and flexibility, and the minimal structures framework they used comprised of economic, institutional, social and technical structures. By drawing on the concept of minimal structures they argued that: “minimal structures are needed to ‘regulate’ lateral relationships, but these structures must leave room for manoeuvre to enable the parties to react to new situations as they arise” (van der Meer-Kooistra and Scapens, 2008: p. 366). A few years later the same researchers connected the concept of minimal structures to CPD projects and in that paper they studied how a minimal structure can provide both firmness and flexibility, which is necessary in collaborative development projects to stimulate creativity and provide coordination (van der Meer-Kooistra and Scapens, 2015). Consequently, minimal structures hold a role in collaborative development projects and is a concept worth exploring in more detail.
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as their shared motivation and enthusiasm for developing an innovative new product (van der Meer-Kooistra and Scapens, 2015). However, to cultivate this increased trust and positive work
environment will take time and resources, because as aforementioned, the employees involved are from different companies, often competitors, that come to work together and after the project is completed go back to their original companies. It should be noted that this whole process, of engaging the individuals, making them feel part of the new PD team and trusting each other, must happen under high time pressure. As previously mentioned, the success of CPD projects is important to the future of the companies involved. Additionally, time to market is very important in the process and since time and resources are limited it is imperative that companies use their existing resources to their
advantage and do everything in their power to ensure the success of the project. As a result, it is worth determining what can contribute to the success of such projects and worth spending valuable
resources on.
Consequently, the research question for this thesis is: How can the social structure contribute to the success of collaborative product development projects, in a context where the parties involved are drawn from multiple organisations? As mentioned earlier, cultivating a social structure is resource consuming, so the purpose of this thesis is to determine what events occur in the absence of a social structure (an inquiry that will determine the value of the social structure), what the requirements are of a well-functioning social structure (an inquiry that will show how to set up a well-developed social structure, because if it is not then it cannot be expected to yield the best results) and most importantly to determine if the social structure can cultivate critical success factors necessary for CPD success (this will reflect how it contribute to the success of such projects.). Finally, to draw a conclusion on how the social structure can contribute to the success of such a project and to advise managers on how to build a strong social structure. This research will prove very helpful to organisations setting up a CPD project, guiding them in how to effectively allocate their limited and valuable resources in a situation that is time sensitive and time to market is key to success. In addition, this research will contribute to the existing field of CPD literature by combining it with the notion of the social
structure. These two concepts are rarely found in combination in the literature and further research in this direction is necessary.
In order to answer the research question, this thesis will study the collaborative development of a new product in a project-based temporary organisation. This thesis will use a case study conducted by van der Meer-Kooistra and Scapens in 2010 on a CPD project, the Phenom Project. The concepts used in this process are those of CPD, temporary organisations, minimal structures and finally the social structure. These concepts are described in the next section. Then the research method will be outlined, discussing the collection of data, and its analysis addressing validity and reliability. Later the case study used in this thesis is described. The following section will discuss the implications of the case study and, finally, the last section will draw conclusions and provide some ideas for further research.
2. Literature review
This part of the thesis will be looking at relevant literature, by focussing on the main concepts; i.e. CPD, temporary organisations, minimal structures and the social structure. In addition, insights gained from the literature will be used in the research design, data analysis and discussion parts of this thesis.
2.1. Collaborative product development and temporary organisations
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range of new products quickly, and at the same time limiting the risks associated with PD (Owens and Cooper 2001).
Moreover, the case study used in this thesis takes place in a temporary, project-based organisation formed for the CPD process by using dedicated staff from a number of different organisations. According to Sydow et al. (2004: p. 1475): “Project-based organizations refer to a variety of organizational forms that involve the creation of temporary systems for the performance of project tasks”. In such an organisation, the staff remain employees of their respective organisations and they come together to work on the joint PD of this project-based organisation (Kenis et al., 2009). The parties come together, interact in the development of a new product, and then go back to working for their original organisations (Morley and Silver, 1977). While the parties work together they form the temporary organisation for the collaboration to take place.
There are many motivating factors that urge firms to participate in CPD projects, and these factors can assist companies in deciding on whether or not they should choose to collaborate. In most cases found in the literature, the benefits that an organisation can gain from a CPD project are a motivational factor for them to participate in such projects. More specifically, the opportunity of sharing and reducing costs has been argued as a main motivational factor by studies such as Littler et al. (1995), Farrukh et al. (2003), and Camarinha-Matos and Abreu (2007). Reducing costs is a major benefit for the parties involved because they can use those additional saved resources in future projects and faster technological innovation. Another motivational factor is sharing technology, knowledge and
experience in order to faster develop the new product, as argued by Littler et al. (1995), Farrukh et al. (2003), Camarinha-Matos and Abreu (2007), Burlat and Benali (2007), and Mazzola et al. (2008), also leading to reduced time to market, a main motivation as argued by Littler et al. (1995) and Hou et al. (2006). And finally it is argued that such collaborations can help in expanding product family and innovation (Littler et al., 1995; Feller et al., 2005). As a result of all the aforementioned motivational factors firms seek to collaborate with each other in the PD process.
It has been established there are many reasons that companies choose to enter in CPD projects, however, there are many risks involved with such projects due to the nature and environment surrounding them. These risks could have a negative effect both on the success of the collaboration and on the individual parties involved. Specifically, a firm’s knowledge, skills or expertise could leak to their competitors (Littler et al., 1995; Parker, 2000; Knudsen, 2007). In addition, Parker (2000) and Littler et al. (1995) argued that companies could suffer from financial and time costs and from losing control over the PD process.
Since risks are part of CPD it is useful to look at the factors that can lead to the success of the project. It should be noted that, when talking about success of such a CPD project companies see it as
successful if it has been completed in the pre-agreed upon time frame, without overspending (Buyukozkana and Arsenyan, 2012). When reviewing the literature various aspects that lead to the success of such projects are defined, however it should be noted that given the uncertainty
surrounding CPD, these aspects do not guarantee success, but they can help to achieve it. Firstly, one of the most important aspects is having trust. Trust, can cultivate a safe environment were the
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and Buckley, 1997; Fraser et al., 2003; Emden et al., 2006; Buyukozkana and Arsenyan, 2012). Moreover, another factor that can help the success of such projects is commitment to the project and its completion and invested interest in the project. When partners are committed to the project, believe strongly in it and have real interest in seeing it succeed then they invest a lot of their resources
towards that project, and that has a positive impact on the success of the overall development (Marxt and Link, 2002; Fraser et al., 2003; Lam and Chin, 2005; Barnes et al., 2006; Shah and Swaminathan, 2008; Chin et al., 2008; Buyukozkana and Arsenyan, 2012). Additionally, another success factor identified in the literature is leadership. Researchers find that having strong leadership can encourage employees to perform their best, inspire team spirit, and increase their investment in the overall project (Barnes et al., 2006 and Chin et al., 2008; Buyukozkana and Arsenyan, 2012). An interesting success factor, closely related to the social structure is inter-team relationships. When individuals working in a development team have good working relationships with their other team members, communication and knowledge sharing are increased, and that as a result increases familiarity and breeds trust amongst the members, helping with the success of the overall project. (Gulati, 1995; Littler et al., 1995; Barnes et al., 2006; Chin et al., 2008; Buyukozkana and Arsenyan, 2012). At this point it has become clear that CPD projects are complex, surrounded by uncertainty and risk. However, there are factors that can help these projects to succeed but they cannot guarantee success. These factors will be addressed later on in this thesis.
2.2. Minimal structures
As aforementioned, in CPD projects the concept of minimal structures can help in dealing with increased complexity in governance issues. In the PD literature Kamoche and Cunha (2001) argued that PD could be seen as a creative process, connecting it to jazz improvisation, in the way that jazz musicians can improvise in their creative process to create a final product that is new and different. In addition, they argued that the structure necessary in that process was a set of guidelines and
agreements, which they moved to conceptualizing as minimal structures (Kamoche and Cunha, 2001). Their research proposed a minimal structure that allowed flexibility and firmness in the PD process and allowed “wide zones to manoeuvre” (Kamoche and Cunha 2001, p. 750) but at the same time defined in a clear way “the levels of responsibilities, priorities and procedures” (Kamoche and Cunha 2001, p.750). Furthermore, Kamoche and Cunha (2001) see their proposed minimal structure as comprising of two elements, the social and the technical structure. They conceptualise the social structure in terms of behavioural norms and communicative codes and the technical structure in terms of quality standards, templates for product concept, knowledge and technology involved in the process (Kamoche and Cunha, 2001).
Building on the previous research of Kamoche and Cunha, van der Meer-Kooistra and Scapens (2008) developed the concept of minimal structures, which is necessary in the governance of lateral
relationships because they provide ‘firmness and flexibility’. They argued that the minimal structure should be extended to include an economic and an institutional structure. The reason being that these structures could provide a setting in which the PD would take place and they are connected to the everyday tasks of the PD process (van der Meer-Kooistra and Scapens, 2008). Moreover, they argue that the four structures put together describe the different elements of a CPD process and if they allow room for innovation and creativity they can be considered a minimal structure (van der Meer-Kooistra and Scapens, 2008).
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requirements, and the parties’ general understanding of their positioning in the market”. In addition, they define the institutional structure as: “the external legal and other regulations, together with the internal organisational arrangements, the type of contracts and the formal nature of the relationship” (van der Meer-Kooistra and Scapens 2008, p. 374). Finally, they define the technical structure as: “the technical interfaces between the parties, the technical features of the products and production
techniques, the technical competencies of the parties, the information systems and information processing techniques and the knowledge of available accounting procedures and techniques are all elements of the technical structure” (van der Meer-Kooistra and Scapens 2008, p. 375).
In a later paper, van der Meer-Kooistra and Scapens (2015) extended their previous work on minimal structures and studied how the structures can govern product co-development projects. They explored how the four structures worked together as a minimal structure with firmness and flexibility to govern the relationships of the parties involved in the CPD project (van der Meer-Kooistra and Scapens, 2015). This is a unique study as it investigates an area of CPD projects in a way that has not been done before, i.e. how it is governed by minimal structures.
The final structure, the social structure is the focal point of this thesis and needs to be analysed in more detail now that the environment that it exists in has been described. The analysis of the social structure will follow in the next section.
2.3. Social Structure
As mentioned above, the minimal structure is needed to provide room for flexibility and
manoeuvring; to do so the collaborating parties need trust, and in order for them to develop such trust there is a need for a strong social structure (van der Meer-Kooistra and Scapens, 2015).
The social structure was first described by Kamoche and Cunha (2001), where they see the social structure to be comprised of various elements. Firstly, behavioural norms which are shared
expectations of appropriate behaviour (Bastien and Hostager, 1988. Secondly, communication and specifically the sharing and communication of information. Another element they find is trust, the faith that the partners will perform with integrity (Kamoche and Cunha, 2001). Moreover, they introduce the element of leadership, which includes the mentoring and empowering of individuals in PD (Kamoche and Cunha, 2001). Finally, the last element they describe is ‘culture’, a shared interest amongst those involved (Kamoche and Cunha, 2001). It should be noted that Kamoche and Cunha (2001) conducted their study in a traditional and more simple PD process that took place in a specific organisation. And that is quite different to the case study explored in this thesis, although various elements remain the same, it is necessary to explore the way the social structure is defined in research that is conducted in CPD projects conducted in separate (temporary) organisations.
As aforementioned van der Meer-Kooistra and Scapens (2008) developed the notion of minimal structures to provide firmness and flexibility in the governance of lateral relationships, extending the minimal structures proposed by Kamoche and Cunha (2001) from two to four. In their research van der Meer-Kooistra and Scapens (2008) defined the social structure as follows: “the social ties between the parties which shape the character of the interactions between the individuals who are involved: how they should behave, the norms, values which are important, their commitments to each other, how they communicate and share information, who takes the leadership role and when, how they learn, and so on” (van der Meer-Kooistra and Scapens 2008, p.374-375). This definition is more fitting for this thesis as it focuses on lateral relationships, that exist in CPD projects.
Moreover, six years later van der Meer-Kooistra and Scapens (2015) used the minimal structure framework they developed in their previous paper (van der Meer-Kooistra and Scapens, 2008) to study the governance of product co-development projects. They move to define the social structure as: “the competences and ways of working of the PD team, as well as their shared motivation and
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73). It can be seen that this definition brings in the concept of shared motivation for innovation and development amongst the team members. This concept was found earlier to be a factor that could lead to the success of such projects, specifically their commitment to the project. As a result, this thesis will research if the social structure can build up this notion, leading to success.
Moreover, van der Meer-Kooistra and Scapens (2015) argue that trust is needed where economic and technical structures leave space for creativity, and that in order to develop that trust a well-developed social structure is required (van der Meer-Kooistra and Scapens, 2015). As was mentioned in the section reviewing CPD literature, trust is a factor that can help influence the success of the overall project. Moreover, trust has a prominent role in many fields and has been researched as part of the strategic alliances literature, production management, supplier network management etc. The reason that trust has been researched to this extent is because it can have positive effects for the collaborating parties. Firstly, trust amongst the partners can reduce the costs, such as monitoring, contractual and other costs (Zaheer et al. 1998; Dyer and Chu 2003; Buyukozkana and Arsenyan, 2012). It can also reduce the risks involved, including knowledge appropriation, financial and time losses, and loss of control (Das and Teng, 2001; Buyukozkana and Arsenyan, 2012). Moreover, trust has been found to increase the performance of both the exchange (the PD process) (Gulati and Nickerson, 2008) and to support learning and continuous improvement in PD (Sako, 1997; Buyukozkana and Arsenyan, 2012). Finally, research has found that trust encourages partners to share information and improve their coordination skills (Dyer and Chu, 2003; Buyukozkana and Arsenyan, 2012). Thus, trust has positive effects on the collaborative process and is important to the success of such projects. Consequently, it will be investigated in this thesis if the social structure can cultivate the trust needed for the success of these projects.
In addition, it is noted that “the institutional structure will shape the context within which the project team has to work in, and it may influence the way team members work together” (van der Meer-Kooistra and Scapens 2015, p.73). Thus, the institutional structure is closely related to the social structure in projects like these and this comes as no surprise as all four structures are co-dependent and collaborate in order to form the minimal structure. Hence, they all influence and affect one another and can have both positive and negative effects. According to van der Meer-Kooistra and Scapens (2015, p. 85): “The good relationships which existed between the senior managers of the collaborating organisations provided the basis for the institutional trust”, thus the fact that the
managers had good relationships was due to the institutional structure that brought them together (the regional development agency- BOM1 ) and that set a positive note for building trust throughout the
project.
However, as can be seen from the CPD literature, there are a lot of risks associated with projects like this. So the collaborating parties need to ensure, at the maximum possible level of certainty, that the project will be successful. The CPD literature revealed multiple factors that can contribute to the success of such projects. However, what the literature seems to ignore is how the collaborating parties are to cultivate those factors in the project. In addition, the social structure literature has revealed that these projects have to do with the people involved, their behavioural norms, their social ties, their interaction, knowledge and information sharing as well as their shared motivation for the product developed. Thus it can be deduced that the people involved in these projects need to cultivate the aforementioned success factors. Consequently, this thesis will explore how the social structure can contribute to the success of CPD projects by cultivating the aforementioned factors. The theoretical framework of this study is depicted in Figure 1 and Table 1 gives an overview of the CPD success factors.
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Figure 1 Theoretical Framework
Table 1 Overview of CPD success factors Overview of CPD success factors Trust
Communication Partner selection
Commitment & invested interest in project Leadership
Inter-team relationships
In the following section the research methods for this thesis will be described and the case will be introduced in order to provide some background.
3. Methods
At this point the methodology section of this thesis will be described. The first part will discuss the research method, the collection of data, and its analysis addressing validity and reliability. The
following section will describe the case study used in this thesis in order to provide some background. 3.1. Research Method
The purpose of this thesis is to study how the social structure can contribute to the success of CPD projects. In order to offer practical solutions to the aforementioned problem qualitative research will take place as the research question requires an understanding of underlying relationships and rich explanations (Eisenhardt, 1989). The case study method is especially suitable for studying phenomena in highly complex contexts, such as high-tech industries and specifically CPD projects that have to deal with high time pressure, and as such it was deemed most appropriate for exploring the research question for this thesis.
The case study used in this thesis was conducted in 2010 by van der Meer-Kooistra and Scapens (2015). The case used in this thesis is the Phenom project as it fits the requirements for studying this research question, it brought together multiple people from different organisations to work together on developing a new product. The product being developed was a desktop electron microscope, and the main goal was to transform the technology that was available in the lab into a marketable product. The electron microscope developed was called the Phenom and thus the project was the Phenom project.
Moreover, this thesis controlled for validity and reliability. To guarantee construct validity I ensured that the interview questions used in this thesis, taken from the original case study, were based on concepts derived from the literature and that they reflected both the social structure and CPD
literature. In addition, I controlled for both internal and external validity. For the former I ensured that the problem was analysed and results were derived from an adequate theoretical frame, i.e. the reviewed literature and ensured that the setup of the study was credible. The latter I controlled by ensuring that the proposed relationships amongst the people involved in the project, can also hold in other collaborative development projects. Moreover, to control for reliability, the case selected was made sure to reflect CPD richly, the study was carried out and then reviewed by multiple researchers, and multiple research instruments were used (triangulation) such as interviews, notes etc. Lastly, researcher bias is controlled by the fact that this case study relied on the published work of the
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aforementioned researchers, who were both present during interviews and checked their results with each other. In addition, all the aspects of the case were reviewed once again by myself for the purpose of this thesis.
As aforementioned the data for this thesis is derived from a case study conducted on the Phenom Project by van der Meer-Kooistra and Scapens. Additional data was collected from information shared by the authors with me including their reports on the case, the paper: Governing product co-development projects: The role of minimal structures (Van der Meer-Kooistra, J., & Scapens, R., 2015), that also studies the Phenom project and more information about it can be found in that paper, consequently it will be referred to repeatedly in this section. Additionally, the researchers shared the chapter: The governance of collaborative product development, published in Accounting, innovation and interorganisational relationships, Routledge publications (2018) also involving the Phenom project and finally multiple conversations took place with one of the authors about this case in order to gain additional information and insight.
The authors held interviews with several key actors in the project. To begin with, an interview was held with the project team leader in 2009 in order to obtain information about the project and the key parties involved. Later in 2010, interviews were conducted with a team leader (or senior person) who was involved with the daily operations of the project. Following this, interviews were conducted with senior managers from all major parties involved, as they were the liaison between the Phenom project and the original organisations. The daily activities of the Phenom project occupied between ten and thirty employees, on average six people from each major party. As aforementioned, interviews were held with both representatives from the organisations contributing to the project, as well as an actor who was involved with the daily operations of the project. That way the role of the social structure was explored both by people directly involved in the project and by people overseeing it. During the interviews questions were asked about various aspects about the project but this thesis focusses on the parts concerning the social structure, and the social relationships that were built in the project team. The interview questions can be found in the Appendix. All the above information was obtained from van der Meer-Kooistra & Scapens (2015), and more information on the interview process, and their data collection methods can be found in that paper.
The data analysis for this thesis was conducted in the following way. Firstly, the conversations with one of the authors took place in order to obtain background information on the case and to gain relevant insights. Following that, all relevant additional information around the Phenom case was collected. That information is mentioned in a previous paragraph and will not be repeated at this point. After all the information was gathered, it was carefully read and reviewed. After that the data was filtered to show only the parts concerning the social structure. That was done by coding for themes such as: social structure; team; people; staff; parties; trust; social skills; communication; meetings; groups; conflict; etc. Following that the information was further categorised into groups in order to answer the following questions, by insights gained from the literature section:
- What events occur in absence of the social structure? An inquiry that will determine the value of the social structure.
- What are the requirements for a well-developed social structure? (how is it built- through what processes) An inquiry that will show how to set up a well-developed social structure, because if it is not then it cannot be expected to yield the best results.
- Does the social structure cultivate the critical success factors found in collaborative CPD literature? This will reflect how it contribute to the success of such projects.
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The following section will describe in more detail the Phenom project, and then the results of this case study will be described.
3.2. The Phenom project
To provide some background for this research the Phenom project will now be described. The following information on the Phenom project has been derived from: Governing product co-development projects: The role of minimal structures (van der Meer-Kooistra, J., & Scapens, R., 2015), the chapter: The governance of collaborative product development, published in Accounting, innovation and interorganisational relationships, Routledge publications (2018) and the case reports from the case study that was conducted. If more details or information on this case is required one can refer to the aforementioned sources.
As previously mentioned, the product that the Phenom project set out to develop was a desktop electron microscope, which would produce images at very high magnification and then selling it as a marketable product. The product being marketable means that, the basic technology is already available in the lab and needs to be ‘translated’ into a product to be sold on the market (van der Meer-Kooistra & Scapens, 2015). I the Phenom project, the technology for such a microscope had been developed by Phillips Research, and FEI Electron Optics bought that technology. FEI did not possess the necessary resources to develop it into a marketable product and that is when the regional
development agency (BOM) connected FEI with other companies in the Eindhoven region in order for them to collaborate and develop the microscope together.
The Phenom project included various collaborating parties. The parties involved in this project can be seen in Table 2 below:
Table 2 Overview of the main parties involved in the Phenom project
Party Responsibility Position
FEI Technology owner, seller of
final product
Risk reward party
NTS Mechatronics developer,
project leader
Risk reward party
Sioux Software developer (supplier) Risk reward party
Benchmark Electronics developer
(supplier)
Development risk, Fixed fee contract
Van Berlo Studios Product designer Fixed fee contract
Source: Governing product co-development projects: The role of minimal structures (van der Meer-Kooistra, J., and Scapens, R., 2015, p. 75).
The first three parties (FEI, NTS & Sioux) were risk reward parties in the project, meaning that they shared both development risks (such as having to undertake more development work than had originally been planned due to unforeseen circumstances) and market risks (such as not making back the investment made for the development if the microscope sales were not good) (van der Meer-Kooistra and Scapens, 2015). As for the reward part, NTS and Sioux were to be paid for their work by sharing the profits from the sales of the Phenom microscope. Moreover, the development risk that was taken on by Benchmark meant that they were exposed to development costs being higher than
expected leading to losses for the company.
In May of 2005 four teams in total were set up. The first was the overall project team, the second was the mechanical team, the third team was the software team and finally the fourth team was the
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architects (initially some were from FEI’s head office in the US), and a FEI sales and marketing representative. The chairman of the mechanical team from NTS, chaired the overall project team. As for the following three engineering teams they consisted of a FEI architect and then chaired by a lead designer who was assigned by the relevant supplier NTS assigned the lead designer to the mechanical team, Sioux the software team, and Benchmark the electronics team. The following table describes the timeline of the Phenom project.
Table 3 Timeline of the Phenom project
Key dates in the Phenom project
Autumn 2004 Preliminary discussions between FEI, NTS and
Sioux.
January 2005 Start of discussions about the contract between
FEI, NTS and Sioux (FEI and Benchmark established a separate contract).
April 2005 Start of the Phenom project; the overall project
team started to draft the specifications of the product.
May 2005 Establishment of the operational teams
(mechanical team, software team and electrical team).
November 2005 Final design of the mechanical/optical product,
the Alpha model.
Early 2006 Testing of the reliability of the
mechanical/optical product
February 2006 FEI, NTS and Sioux sign the contract.
May/June 2006 Beta products are completed and sent to the
Beta customers’ sites: they use/test the product and give feedback.
End 2006 End of the testing phase.
April 2007 First release of the product.
May 2007 FEI formally accepted the product.
2009 Establishment of Phenom World for the
marketing and sales of the product.
Source: Governing product co-development projects: The role of minimal structures (van der Meer-Kooistra, J., and Scapens, R., 2015, p.78)
Another important part of understanding the Phenom project is how meetings were structured, who was involved in them and their frequency; these aspects are important to the following results section. For the duration of the Phenom project there was a large number of meetings held, especially in the early stages of the project, but also later on in the process. There were also a lot of meetings held in order to address specific issues and problems that arose during the development process. The meetings that were formally organised are described in the following paragraph in order of their frequency.
Firstly, there were daily meetings set up for the members of the three operational engineering teams (mechanical team, software team, and electronics team). The operational teams had a lot of contact with each other and even though their teams were in different locations they came together very often. The mechanical team and the software team had their own room in the NTS building, but over time the software team moved to the Sioux building, and finally the electronics team was located at
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In addition, there were weekly meetings involving the overall project team; they met every week in the NTS building. At the very beginning there was some input from Philips Research, which had developed the technology for the miniaturised microscope, but subsequently they did not participate in the overall project team.
Moreover, on a quarterly basis (or every three months) “Reconciliation meetings” were held. At these meetings senior managers from the various companies and the entire project team (comprising the members of the overall project team and the three engineering teams) discussed such issues as the functional models developed by the engineering teams, test results, and costing and pricing. Finally, the least frequent meetings were the management meetings, which took place two or three times a year, brought together the senior management of FEI, NTS and Sioux to discuss contractual matters, review the progress of the project, and consider financial and sales issues.
The following section will analyse the results of this thesis following the research methodology that was described in the previous section.
4. Results
This section will describe the results that were derived from the research methodology described in a previous section. It will commence by looking into what occurs in the absence of a social structure. At the beginning of the execution phase of the project the social structure was only just emerging, and was definitely not well developed, this generated various problems in the project. The managers involved in the project already knew each other, as they had collaborated in the past and they trusted each other. However, multiple individuals with various levels of expertise were drawn from the different parties and it was necessary that their work was integrated into the project (van der Meer-Kooistra and Scapens, 2015). These individuals did not know each other, they had never worked together before and had different academic backgrounds. The engineers from FEI (American company) were usually academically trained to PhD level, whereas the engineers in NTS (Dutch company) had professional training following a master’s degree from a technical university or a bachelor’s degree from a polytechnic institute (van der Meer-Kooistra and Scapens, 2015). These engineers had to work together to complete the development work and in absence of a strong social structure, tension developed. The FEI engineers were concerned about the technical competences of NTS and Sioux engineers and whether or not they were competent to deliver what was expected. Van der Meer-Kooistra and Scapens (2015, pg. 79): “The FEI engineers questioned whether the NTS engineers had the necessary academic training to solve the technical problems which would inevitably arise in the Phenom project”. These engineers did not trust each other, they had not interacted with each other and as a result the aforementioned events took place. It is evident that were the social structure was not there to guide these engineers’ relationships, tension, mistrust and
misunderstandings arose. As a result, this underlines the fact that when the social structure is not present things can go wrong that can affect the entire project.
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day is one factor that built a well-developed social structure. The individuals came together in a room and had to communicate, discussing the project. This was emphasised by the project leader, that the meetings were necessary to “create good communication” and he proceeded to say:
“There were a lot of complete group [the entire project team] sessions where we said we want to go through the designs so everybody knows where we are and what the planning is. And then we go and have dinner and a drink. It creates a good feeling and everything needed to make communication as easy as possible during the work.” (van der Meer-Kooistra and Scapens, 2015, p. 80).
Thus, it can be deduced that the meetings are important to setting up a well-developed social
structure. And that is partly due to the fact that they provide the setting for other factors to take place that in turn create a well-developed social structure. One of those factors being communication. Communication is essential to a well-developed social structure. Individuals can discuss their ideas, interact with each other, get to know each other better and function better as a team.
Moreover, a very important factor to the social structure is the people involved in it, as they are the ones it concerns. The Phenom project leader noted the following:
“Choosing the right people is very important” (van der Meer-Kooistra and Scapens, 2015, p. 80). And the following event occurred:
“In one instance the NTS project leader realised that he had not allocated the appropriate engineer to a specific task, because the person allocated lacked certain technical skills and, more particularly, the requisite social skills to work within the team of people who now comprised the Phenom project” (van der Meer-Kooistra and Scapens, 2015, p. 79).
As a result of that event, the engineer had to be replaced, and another one that had all the necessary skills put in his position. The fact that the wrong person was put in that position caused such problems that he had to be replaced, costing both time and money. Thus, having the right people, with the appropriate skills working in the team is very important, for the reason that they are the ones
developing the product, comprising the teams and doing all the work. Thus, selecting people that are able to work well with others, have the technical competencies and good social skills is also a strong component to a well-developed social structure. This however, can be extended to selecting the right leaders to guide the team through the process.
Leadership has been strongly highlighted in the literature section of this thesis. In the words of the Phenom project leader:
“I stimulated the people to communicate. I tried to get an organisation in which the people are at the same level, and are not afraid to say what they think without looking at hierarchical lines” (van der Meer-Kooistra and Scapens, 2015, p. 80).
And from the Sioux CEO:
“I am responsible for where we go, but not for how we do it. I leave that to the employees” (van der Meer-Kooistra and Scapens, 2015, p. 81).
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“It’s getting the mind-set, or creating the playing field, so that the teams can do it themselves…to do that you need a certain playing field and managers should create it – should create the conditions so that people can do it.” (van der Meer-Kooistra and Scapens, 2015, p. 81).
These managers did not micromanage their employees, they did not attempt to solve every problem that arose themselves. Instead they provided guidance, the conditions necessary for their employees to take action and solve problems and conduct their work on their own. The managers were leaders in this case, encouraging their employees to take initiative and act. Thus strong leadership that provides flexibility and guidance to the employees is a factor leading to a well-developed social structure. Moreover, the Phenom project leader: “emphasised that it is important for all members of the project team to have the same interests in the successful outcome of the project” (van der Meer-Kooistra and Scapens, 2015, p. 81).
Also FEI’s VP for New Business commented:
“This project was very fast, by far the fastest project of FEI. People were so excited just doing it. It was just fun. People worked day and night to meet the schedule.” (van der Meer-Kooistra and Scapens, 2015, p. 81).
The people involved in the Phenom project were very committed to it, and most importantly
committed to its success. The whole team had a common goal and that was to see this project succeed. That drove them to work a lot and efficiently. This meant that they all had a shared goal, a shared aspiration and they could bond and socialise over that. It made them work better as a team. That common goal acted like glue for the team members, bringing them all together and uniting them under that one shared idea. This whole process strengthened and solidified the social structure in the
Phenom project and made people more committed to the project than their own company (van der Meer-Kooistra and Scapens, 2015).
As aforementioned, at the beginning of the project the team members did not have faith in each other’s competencies. This problem was solved when the social structure came to be:
“These concerns were overcome in practice as the NTS engineers were able to solve problems as they arose, sometimes with simple, but practical solutions, while the American engineers would probably have adopted far more complex and consequently more costly solutions. By working together competence trust increased as the social structure evolved” (van der Meer-Kooistra and Scapens, 2015, p. 79).
As aforesaid, institutional trust was present in the project but trust between the individuals had to be cultivated. In order for the individuals to communicate, share information and knowledge, they need trust. The social structure will never work properly if its members do not trust each other, that trust is the basis. However, it cannot be developed if the previous factors do not occur first. People need to communicate and interact before they can trust each other. Thus it can be concluded that trust is another fact that builds a well-developed social structure.
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The first success factor to be examined is inter-team relationships. As has been aforementioned the social structure is all about the people involved in the project and their relationships. Moreover, one of the components of the social structure is inter-team relationships. What seems to be important is good inter-team relationships, where people like each other, work well together and make a good team. A well-developed social structure can cultivate such relationships. From the authors notes:
“The emerging personal relationships comprise part of the social structure, which had to be established for this project…individual relationships were essential in building an effective PD team”.
Thus it becomes clear that the social structure builds inter-team relationships as they are part of the structure, and those relationships are important to the success of the projects. Hence the social structure contributes towards that.
Another important success factor indicated by the literature is leadership. Leadership involves the relationship between the manager and his employees and thus falls under the scope of the social structure. Moreover, we deduced earlier that leadership, is also a factor of well-developed social structures. The social structure provides the context for leadership to emerge and for mangers to be able to lead. And in the Phenom project they did. As can be seen from the aforementioned quotes on leadership, the managers guided their employees and encouraged them to be part of the decision making process. The social structure that was in place allowed them to show leadership skills that contributed to the success of the project, and that is another way that the social structure contributes to the success of such projects.
Moreover, the literature suggests that communication leads to the success of such projects. The social structure comprises of the individuals’ interactions and thus their communication. It can be seen in the case that when there was no social structure in place the individuals did not communicate with each other, they did not share, and that had negative effects. But as the social structure emerged through the meetings and discussions that these individuals had to have communication increased. And from increased communication came increased sharing of knowledge and information. The project leader: “The meetings were essential to create good communication” (van der Meer-Kooistra and Scapens, 2015, p. 80).
And since the social structure was well developed their interactions did not stop after work hours. The project leader continues:
“And then we go and have dinner and a drink. It creates a good feeling and everything needed to make communication as easy as possible during the work.” (van der Meer-Kooistra and Scapens, 2015, p. 80).
It is clear that the social structure in place provided the setting and the positive atmosphere for people to communicate and most importantly to want to communicate and to share, that then resulted in making their development process easier and more effective, contributing to the overall success of the project.
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the project by making them feel as they are the project, making them a new team that identifies with the project and its success. So the project’s success is their success. As can be seen in the Phenom project:
Benchmark Project Manager: “Our engineers are more committed to their project than to their own company.” (van der Meer-Kooistra and Scapens, 2015, p. 81).
CEO of NTS Group: “Everybody is responsible for the end goal: the product with specific features, and not for a specific part. If there is a problem, it is everybody’s problem. The people from all the parties, not only from the risk-reward parties, had to work in this way” (van der Meer-Kooistra and Scapens, 2015, p. 81).
FEI’s VP for New Business: “These young people were very eager to make the project a success – the project was a step in their career” (van der Meer-Kooistra and Scapens, 2015, p. 81).
The aforementioned points demonstrate how the social structure can cultivate commitment and invested interest in the project.
Finally, a very important factor highlighted in the literature is trust. As mentioned earlier, when there is trust individuals communicate more freely and openly, share more information and knowledge, and feel safe in doing so. The Sioux manager:
“The good relationships between the senior managers of the companies contributing to the project can help to develop trust between the individuals working on the project” (van der Meer-Kooistra and Scapens, 2015, p. 81).
The social structure also encompasses the relationships between the managers. It can be deduced therefore, that those good relationships cultivated the environment for the other employees to develop trust amongst themselves. However, this is not something new, van der Meer-Kooistra and Scapens (2015) have already proved that in order to develop that trust a well-developed social structure is required. Hence it is clear that the social structure provides the context and setting for trust to be developed and that is another way it contributes to the success of such projects.
Those were the findings that resulted from the research methodology described in the previous section. In the following section of this thesis a discussion of the results and their implications will take place.
5. Discussion and Conclusion
The purpose of this thesis was to research how the social structure can contribute to the success of collaborative development projects, in the context where the parties involved are drawn from multiple organisations. In addition to the main research question, subsequent research questions arose that helped structure the research process. The subsequent research questions aimed to determine what events occur in absence of the social structure, what the requirements are for a well-developed social structure, and finally if the social structure cultivates the critical success factors found in CPD literature.
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As a result, it underlined the fact that when the social structure is not present events can occur that can affect the success of the entire project. Previous literature had indicated that trust is needed where economic and technical structures leave space for creativity, and that in order to develop trust a well-developed social structure is required (van der Meer-Kooistra and Scapens, 2015). Meaning that in the absence of the social structure, trust cannot be developed. In addition, Kamoche and Cunha (2001) found that the social structure is needed to guide the PD process, which means that when it is absent there is room for mistakes to be made. In that sense my findings give support to previous literature and extend the negative effects of not having a well-developed social structure to include tension, mistrust and misunderstandings that can affect the success of the project.
As aforementioned, during the initiation phase of the Phenom project, the social structure was absent, even though most of the collaborating parties had previously worked with each other. However, because of their previous collaborations the parties had institutional trust, an element of the institutional structure that was already in place at the initiation of the project. In addition, both an economic structure (i.e. risk reward model) and a technical structure (technical specifications of the product) were present at the initiation phase, allowing flexibility for the social structure to emerge. Kamoche and Cunha (2001) found that the structures need to work together to provide firmness and flexibility and van der Meer-Kooistra and Scapens (2015) found that the four structures are
overlapping and affect one another. Even though the focus of this thesis is the social structure it does not stand alone. The social structure is part of the minimal structure in place. The structures can influence the setup of another structure and that is indeed the case here. The social structure emerged during the initiation phase of the project in the setting that the minimal structure already in place provided.
At this point it was evident that a well-developed social structure is important to CPD. Thus I moved to determine what the requirements are for a well-developed social structure (i.e. how it can be developed, through what processes). The results indicated that a well-developed social structure can be built through regular meetings, communication, assigning the right people to the project (i.e. those who possess the appropriate skills, and importantly social skills), leadership that inspires and unites employees, trust and everyone involved to have the same common goal. To the best of my knowledge the literature does not reflect this aspect of the social structure and thus this thesis contributes to it. Moreover, the CPD literature indicated several success factors of collaborative development projects. For the purpose of this thesis I researched if the social structure can cultivate any of those success factors. The findings indicate that the social structure does indeed cultivate many of those success factors. More specifically it develops good inter-team relationships, and thus this thesis corroborates and extends findings of previous literature (Gulati, 1995; Littler et al., 1995; Barnes et al., 2006; Chin et al., 2008), that good inter-team relationships can create a positive environment and trust for the people involved, and that the social structure cultivates this success factor. Moreover, this thesis found that the social structure can cultivate the success factor ‘communication’ highlighted in the CPD literature (Littler et al., 1995; Hou et al., 2006; Shah and Swaminathan, 2008; Buyukozkana and Arsenyan, 2012), corroborating that this is indeed a factor that can lead to CPD success and extending it to indicate that the social structure can cultivate it. In addition, the social structure was found to cultivate both leadership and trust, success factors highlighted in CPD literature. These findings agree with previous literature (Sako, 1992; Littler et al.,1995; Glaister and Buckley, 1997; Fraser et al., 2003; Barnes et al., 2006; Bstieler, 2006; Emden et al., 2006; Hou et al., 2006; Shah and
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Arsenyan, 2012). Its importance to the success of such projects has been reaffirmed and extended to the social structure.
However, the social structure does not develop the success factor of partner selection found in CPD literature (Littler et al.,1995; Glaister and Buckley, 1997; Fraser et al., 2003; Emden et al., 2006; Buyukozkana and Arsenyan, 2012). This is a process that takes place before the social structure is even set in place and thus it is impossible to help with that. However, this finding does not contradict previous literature. It underlines the fact that the social structure is important but cannot stand alone, it is always part of the minimal structure and the other structures can help cultivate the aforementioned success factors. In the Phenom project good partner selection was ensured by the institutional environment, specifically the stimulating and facilitating role played by BOM, as most partners had worked together in the past and knew each other. And since the institutional structure is part of the minimal structure it can be deduced that the minimal structure could also contribute to the success of such projects.
Finally, the aforementioned research questions lead to the reasoning that the social structure
contributes to the success of collaborative development projects by cultivating the following success factors: good inter-team relationships, communication, leadership, trust and finally commitment and invested interest in the project. Thus answering the main research question of this thesis.
Consequently, the results of this thesis have several theoretical and managerial implications. Firstly, concerning theoretical implications, this thesis extends our knowledge of two existing fields, CPD and minimal structures. This thesis highlights the importance of the social structure to the success of CPD projects. In addition, it combines the two fields and focuses specifically on the social structure, a combination previously ignored in the literature, and thus enriching the existing field. Moreover, this thesis has several managerial implications. Firstly, it points out to managers that the social structure is important because it contributes to the success of such projects and that they should take the time and put in the effort to develop it properly. In addition, it acts as a guide to developing the social structure well, managers can then follow the findings of this thesis and put in place a well-developed social structure. Thus, if managers want to do so, they need to set up regular meetings, encourage
communication, assign the right people to the project (i.e. those who possess the appropriate skills, and most importantly social skills), ensure strong leadership, build trust and finally inspire to everyone involved the same common goal. This research will prove very helpful to organisations setting up a CPD project, guiding them in how to effectively set up a well-developed social structure in a situation that is time sensitive and time to market is key to success.
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7. Appendix
Overview of interview questions Position of the interviewee:
What is your position in your company?
What is your position in the project (your relationship with the other members of the project team)? Why are you involved in this project?
How was the decision made about your involvement?
Have you been involved since the start of the project or even before the go-decision? Do/did you collaborate with the same parties in other projects?
What is the percentage of time you are spending on this project? How does your company evaluate your performance?
What is the importance of the project for your organisation?
Governing the relationships between the parties:
How do you exchange knowledge with the other parties in the project?
If the project faces problems, e.g. financial, technical, co-operation or compliance problems, how do you solve these problems?
Could you give an example of such a problem and elaborate on how you did solve this problem? When another party faces problems that influence the project, do you try to help this party to solve its problems?
Could you give an example of such a problem and tell us how you did help your partner?
Have you developed norms about how to co-operate with each other (at the start of the project or over time)?
How do you perceive the co-operation with your partners and how do you perceive the co-operative attitude of your partners?
What is crucial for a good co-operation?
How do you perceive the relationship with the representatives of the partners in the project?
Working with the other parties:
What are the key issues that make the collaboration easier or more difficult? What are the interfaces between your work and the work of your partners?
How often do the members of the project team meet each other (formal and informal meetings)? How does the project team react to changing circumstances (e.g. the current economic downturn)? Do you assess and discuss the collaboration with your partners (how and how often)?
Do you feel yourself liable for all the project activities, even those executed by your partners? How do you plan the daily project activities?
How do you evaluate the progress and the success of the project (perception of the interviewee)? Has the project team made any mistakes (innovative activities need room for making mistakes)?
