Author: Yun-kyung Whang

Publisher:

Published: 2009

Total Pages: 0

ISBN-13:

The convergence issue has long drawn the attention of both researchers and practitioners. For some decades in the past, the theme of convergence was directed at the level of technologies - the process by which technological bases in different sectors become similar (Rosenberg, 1976); while in recent times, it seems to be focused more at the product level - the phenomenon of combining several products, once in disparate sectors, into a single product. Convergence of products may increase the complexities and uncertainties that the company should deal with because it continually augments the technologies and markets that already exist. Nevertheless, very little thorough investigation into the convergence process has yet been undertaken. The purpose of the thesis is therefore to explain the convergence processes and their driving forces, especially focusing on product-level convergence. The thesis begins by reviewing several notions relating to convergence in various literatures, and distinguishes several different types of convergence. The thesis is guided partly by the industry dynamics based on product life cycle approaches, and partly by dynamic capabilities perspectives. Those two perspectives are combined in such a way as to provide a useful framework for the empirical study. Moreover, national systems of innovation approaches arc also incorporated to provide some clues to explaining the differential rates of product convergence in different countries. On those bases, a cyclical two-phase model of convergence in the mobile handset industry is developed, which alternates between producerside convergence and supplier-side convergence, and later tested with an industry case study of Korea. The notion of a simple sequence between producers-side and suppliers-side convergence did not fit properly with the industry study- close interaction with the demand side is also critical to the convergence as the literature on innovation has already emphasized. Producers interact with both the supply of technologies and the demand for their products and try to align changes of technologies and markets. The convergence process shows the coupled dynamics of technologies (suppliers), producers and demand (users), involving evolutionary interactions and dynamics of all relevant parties. Such results fit better with the threefold classification of demand-production-supply of von Tunzelmann (2003), rather than the conventional type of traditional supply and demand duality, and reflect 'dynamic interactive capabilities' of firms involving 'successful interaction between evolving consumer and supplier capabilities and evolving producer capabilities' (von Tunzelmann and Wang, 2007). Moreover, the interactive convergence processes in Korea were largely facilitated by the newly shaped systems of innovation in Korea, fostering close interaction between the actors. This implies that NS Is play an important role in shaping the dynamic capabilities of national firms, as they give different conditions for the interactions and cooperation in the innovation process. Such a role for NS Is is emphasized especially in rapidly changing environments where changes in technologies and markets are so fast that any single organization can hardly develop all the necessary capabilities and has to depend on others, requiring close interactions. The result highlights the need to consider the interlinked nature of those two approaches, of national systems of innovation and dynamic capabilities, and suggests that dynamic capabilities are mediated by the institutions and competencies of the national system.