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Building an innovation-based supplier portfolio: The use of patent analysis in strategic supplier selection in the automotive sector

Alexander Trautrims, Bart L. MacCarthy and Chetan Okade

International Journal of Production Economics, 2017, vol. 194, issue C, 228-236

Abstract: With an increasing proportion of external spend allocated to a smaller number of suppliers in their supply base, car manufacturers rely more and more on the performance of key supply chain partners outside their own organisational boundaries, particularly for product innovation. The identification and selection of innovative suppliers for strategically important supply categories require tools to determine which supply categories are supplier innovation-led and which suppliers are the most innovative. Here we discuss the use of patent analysis to identify product categories where supplier-led innovation is important, and which suppliers are leading innovation. We use data from the US patent office to analyse two important product innovation supply categories – car body technologies and car seats – from a leading premium automotive producer's supply portfolio. From the patent filings data we identify the innovation activities of car manufacturers and suppliers in each category over an eleven year period. It is evident from the analysis that innovation in car body technologies is dominated by the car manufacturers whereas innovation in car seats is strongly supplier-led. The results of the patent analysis are used to develop and discuss supply management options for the case company. Insights gained from patent analysis can be used to support procurement and sourcing processes at different levels: to identify innovation-active product categories at a supply portfolio level; to assess the innovativeness of potential suppliers at a product category level; and to identify which tier in a supply chain is active in product innovation at a supply chain level. Broader issues on the potential of patent analysis to inform and support procurement and sourcing processes are discussed.

Keywords: Supplier management; Supplier portfolio; Supplier selection; Innovation; Patents (search for similar items in EconPapers)
Date: 2017
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