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Value-chain innovation in aquaculture: insights from a New Zealand case study

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Abstract:

We report a case study of value-chain innovation in a niche, export-oriented aquaculture industry, namely, Chinook/King salmon, that contrasts with the much more common Atlantic/Norwegian salmon. The firm in question is vertically integrated, thus offering a ‘cradle-to-grave’ vista of innovation that spans ‘production’ (i.e. farming), processing, marketing, and distribution. A major finding is the need for a delicate balance between the relative expenditures on production research and developmental research in integrated aquaculture firms, especially those that focus on niche species. Interaction effects between the two research strands complicate the trade-off: production research adds value at the fish farm by lowering the unit cost of production – and in turn facilitates new product development as it is easier to add value to a lower-cost product than a higher-cost product. From the case study findings, we synthesize a process model of value-chain innovation that is applicable for integrated aquaculture firms. We also induce several implications for the management of Research & Development and innovation in such firms.

Document Type: Research Article

DOI: http://dx.doi.org/10.1111/j.1467-9310.2006.00441.x

Affiliations: 1: Department of Information Systems & Operations Management, The University of Auckland, Private Bag 92019, Auckland, New Zealand., Email: j.sankaran@auckland.ac.nz 2: Department of Management & Employment Relations, The University of Auckland, Private Bag 92019, Auckland, New Zealand., Email: s.mouly@auckland.ac.nz

Publication date: September 1, 2006

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