Paper info

Collaborative Customization and Innovation in Business networks: How does Proximity Matter?

Raffaella Tabacco and Roberto Grandinetti

The paper was published at the 27th IMP-conference in Glasgow, Scotland in 2011.

Abstract:
The success achieved in the past by industrial districts and geographical clusters has shown
that spatial proximity matters, especially when referred to subcontracting relationships.
However, in the last two decades globalization of production, development and diffusion of
ICTs, and growing modularization of products have significantly reduced the traditional
advantages of geographical clusters, and, more generally, the importance of spatial proximity
to the definition of an efficient and effective management of inter-organizational
relationships. It is then appropriate to ask if the geographical proximity can still matter in a
globalized world, and the reasons why this happens. The paper analyses the case of a global
mid-sized company that has recently activated new relationships with local strategic suppliers
at the same time of a growing internationalization. The case study suggests that the choice of
increasing spatial proximity derives from a very specific process of customization, which
cannot be achieved by adopting the modularity-postponement approach largely analysed in
the literature. We propose the concept of collaborative customization to identify a
customization process that is based on an intense collaboration between the focal firm and its
strategic suppliers.
Keywords: Geographic proximity, supply chain, collaborative innovation, customization