IDENTIFICATION AND GENERATION OF INNOVATIVE IDEAS IN THE PROCUREMENT OF THE AUTOMOTIVE INDUSTRY: THE CASE OF AUDI AG

Abstract

Open innovation and the use of suppliers and start-ups as external idea sources have become increasingly important in the automotive industry. Since the purchasing function in a company has correspondingly become more strategic, scholars have taken the role of procurement in innovation more intensely into account. This study examines procurement’s role in the innovation process of the automotive industry and investigates which and how open innovation instruments are used in order to benefit from the innovation capability of suppliers and start-ups. The empirical evidence is based on an in-depth case study of the automotive manufacturer AUDI AG. Several arguments are elaborated which justify a key role for procurement in the innovation process (e.g., interface role, economic activities). Furthermore, we identified nine pull and push instruments enabling procurement to contribute to Audi’s innovation performance. Since the instruments are designed to meet different internal requirements (e.g., in relation to a vehicle project or not), interesting insights for scholars and practitioners are provided.