Does black-box supplier involvement help buyers' product modular and architectural innovation? The moderating role of product modularity

Abstract

Purpose In product modular design tasks, especially in the high-tech manufacturing industry, buyers and supplies play distinct roles, which may have different impacts on product architectural and modular innovation. Prior research has tended to view product innovation as a holistic concept, overlooking the importance of this differentiated influence. This study, from a modular design perspective, aims to clarify the impact of black-box supplier involvement on product architectural and modular innovation, as well as the influence of product modularity on these relationships. Design/methodology/approach Based on the theory of product modular design, this study decomposes product innovation into architectural and modular innovation from the perspective of the product internal structure to conduct in-depth theoretical analysis and model construction. A total of 276 valid questionnaires are collected from typical Chinese high-tech manufacturing firms and used to empirically test the constructed theoretical model using multiple hierarchical regression analysis. Findings The results show that black-box supplier involvement positively affects modular innovation and takes an inverted U-shape, as moderated by product modularity. However, the impact of black-box supplier involvement on architectural innovation shows contradictory differences at different modularity levels. Under a low level of product modular design, black-box supplier involvement has a negative impact on architectural innovation, but under a moderate level of modular design, it has a positive impact. After the degree of modular design exceeds a certain threshold, the impact gradually weakens. Practical implications The results provide valuable insights for managers, highlighting the need to avoid oversimplifying the innovation impact of black-box suppliers solely based on overall product innovation. Instead, a more accurate assessment of the innovation contributions of both the buyer and supplier should be based on the degree of architectural and modular innovation. Additionally, the findings suggest that managers should consider the alignment between their company's product modular design features and innovation priorities (i.e. modular innovation or architectural innovation) when determining an appropriate supplier collaborative development strategy. Originality/value This study not only reveals the different impacts of black-box supplier involvement on architectural and modular innovation, but also proves the significant synergistic innovation effect of the relationship between black-box supplier involvement and product modularization. It constitutes an enriched and deepened exploration in the existing research on supplier involvement in product innovation.