State and development of innovation networks - Evidence from the European vehicle sector

Purpose - Innovation is one of the key drivers of economic success. However, the global environment is changing and makes innovation management more competitive. In order to sustain an advantage, companies seem to adopt more flexible schemes of organization. Specifically, innovation networks appear useful to researchers and practitioners. This paper aims to explore the current empirical relevance of this phenomenon in the automotive sector, the goals and performance of innovation networks as well as their formation and governance. Design/methodology/approach - Through a series of semi-structured interviews with managers from European automobile firms, insights into network approaches and strategies based on the analysis of 39 innovation networks are presented. The study comprises all relevant actors in the industry such as large OEMs as well as small and medium-sized second-tier and third-tier suppliers. Findings - The empirical survey was able to confirm that innovation networks are of high relevance in the automobile sector. It can be expected that innovation networks will spread further and gain more importance in the coming years. The most important goals that the involved companies aim to realize by using innovation networks include flexible access to technologies, intensified contact with clients and markets and long-term bonding of suppliers and clients. The companies report a fairly good performance of their innovation networks. Finally, various aspects of network formation and governance have been identified. Practical implications - Several deficits in current network management practices are identified. Improving these issues, the performance level of innovation networks could be raised even higher. Originality/value - Building on previous work in this field, this paper adds empirical insights on innovation networks in the automobile business.