Factors influencing the relationship between product modularity and supply chain integration

Abstract

Purpose: The purpose of this paper is to explore the relationship between product modularity (PM) and supply chain integration (SCI), and to identify factors influencing this relationship. Design/methodology/approach: A case study approach involving in-depth interviews on three modular and two non-modular design projects in the Hong Kong and Pearl River Delta region was conducted. Within and cross-case analyses were adopted. Findings: Results support the current view that modular design is related to a loosely coordinated supply chain, whereas integrated design is associated with a tightly coordinated supply chain. However, this relationship is affected and explained by four contingency factors: new module/component development, technological knowledge leakage and creation, project team size and supply chain efficiency. Research limitations/implications: The paper used a case study approach so the generalizability of the study is limited. This approach, however, enabled us to examine explicitly the relationship between PM and SCI, where empirical research was lacking. The rich content of each case suggested how and why modular design affects supply chain management. Originality/value: The findings of this paper increase the understanding of the dynamics of modular product design and supply chain management. The paper also explores four contingency factors affecting the relationship.