New technology can be the basis for new products, new services and new companies, but it is also a threat to existing companies. As a consequence great companies are challenged when new technology enters into their existing products. This was also true for large engineering corporations in Sweden when digital electronics made an entrance into their traditional mechanical products some 50 years ago.
How did early adopters in Sweden, like Ericsson and Saab, handle this challenge? They did not choose to rely entirely on in-house competence. They also hired very qualified R&D related ICT consultants. A new ICT consultancy industry, which was very different from the ERP consultancy business, was born. As a consequence consultants played an important role in research and product development and helped large engineering corporations to master the dynamics of innovation.
The R&D related ICT consultancy industry, focusing on developing new products and services for their customers, still plays an important part in Swedish industry. In a recent quantitative study, made for the Swedish Governmental Agency for Innovation Systems, more than 350 such companies with about 13 000 employees, were identified. The sector is dominated by a handful domestically owned and operated companies, which serve the Swedish industry with development of embedded systems and software. In this article we study how this new consultancy industry evolved and how the customer base has grown larger over time.
One conclusion is that thanks to the externalization of R&D the competence has not been locked in. Instead engineering companies in one industry has been able to benefit from competence and experience developed in other companies in different industries.
2013. 13- p.