Global and local knowledge dynamics in an industry during modular transition A case study of the Airbus production network and the Aerospace Cluster in Hamburg, Northern Germany Dissertation with the aim of achieving a doctoral degree at the Faculty of Mathematics, Informatics and Natural Sciences, Department of Geosciences of Universität Hamburg submitted by Sonja Buxbaum-Conradi May 2018 in Hamburg Univ.-Prof. Dr. Jürgen Oßenbrügge Universität Hamburg Institut für Geographie Univ.-Prof. Dr. Max-Peter Menzel Alpen-Adria-Universität Klagenfurt Institut für Geographie und Regionalforschung Date of the oral defense: 04.07.2018 i Table of Contents List of Tables iv List of Figures iv List of abbreviations vi Acknowledgements viii Foreword viii Abstract (English) x Abstract (German) xi 1 Introduction 1 1.1 Background and research interest 1 1.2 Analytical framework and methodology 5 1.3 Outline and structure of the thesis 6 2 Theoretical framework and conceptual model 10 2.1 Exchange relations in production systems 11 2.1.1 Cyber-Physical Systems 11 2.1.2 Global value chains and global production networks 13 2.1.3 Embeddedness of actors and relations 23 2.1.4 Individual and systemic trust 26 2.1.5 Summary and conclusions for the further analysis 28 2.2 Knowledge and production 30 2.2.1 Explicit and tacit knowledge 30 2.2.2 Codified knowledge and knowledge embodied in artifacts 31 2.2.3 Industrial and technological standards as a form of codified knowledge 32 2.2.3.1 The functional character of standards 32 2.2.3.2 The normative character of standards 32 2.2.4 Standards in global value chains and global production networks 33 ii 2.2.5 Knowledge codification and standard formation processes 36 2.2.6 Knowledge infrastructures 40 2.2.6.1 Development and formation of knowledge infrastructures 41 2.2.6.2 Embeddedness of knowledge infrastructures 41 2.2.7 Summary and conclusions for the further analysis 44 2.3 The architecture of knowledge exchange relations in modular production networks 46 2.3.1 Modular product and design architectures 46 2.3.2 Knowledge infrastructures in modular production 52 2.4 Modularization as a dynamic multi-dimensional process 58 2.4.1 Modularization as a strategic process 58 2.4.2 Modularization as an emergent and path-dependent phenomenon 60 2.4.3 Phases of modularization 63 2.4.4 Summary and conclusions for the further analysis 64 2.5 Modularization and territorial development and change 67 2.5.1 Global production networks and territorial development 67 2.5.2 Socio-spatial disembedding and re-embedding of knowledge and production relations 70 2.5.3 Synthesis: Conceptual model and research question 71 3 Case study of the Airbus production network and the aerospace cluster in the Metropolitan Region of Hamburg 75 3.1 Introduction and methodological approach 75 3.1.1 The Airbus production network and the aerospace cluster in Hamburg as a heuristic single case study 77 3.1.2 Grounded theory as an interpretative, explorative approach 83 3.1.3 Case study analysis and theory building 93 3.2 Operationalization of the analysis 94 3.2.1 Selection and definition of the case example 95 3.2.2 Operationalization of the temporal dimension and time frame of the analysis 97 3.2.3 Triangulation of data sources and data collection methods 99 3.2.3.1 Semi-structured expert interviews 100 3.2.3.2 Semi-overt participant observation/participant observation 102 3.2.3.3 Collection of documents and technical data 103 3.2.3.4 Overview of empirical database 103 iii 3.2.4 Combination and aims of data analysis methods and different steps in the process of data analysis 104 3.3 Some concluding remarks on the reliability, validity and scope of results 106 4 Case study results 108 4.1 Modular transition and globalization of the Airbus production network 108 4.1.1 The Airbus production network and the European aerospace industry 108 4.1.2 Airbus and the aerospace industry in Hamburg and Northern Germany 111 4.1.3 Changing product architectures and reconfiguration of production relations 116 4.1.4 Building a new knowledge infrastructure 123 4.1.4.1 Technological and codification infrastructure 123 4.1.4.2 Social infrastructure and diffusion of standards in the Airbus production network 125 4.1.4.3 Socio-spatial embedding 129 4.1.5 Synthesis and conclusion 132 4.2 The impact of modular transition on the aerospace cluster in the metropolitan region of Hamburg 135 4.2.1 Former embedding of suppliers in vertical production and knowledge relations 135 4.2.2 Disembedding and re-embedding of production and knowledge exchange relations 136 4.2.3 Changing relations of trust 142 4.2.4 Horizontal exchange relations and embedding in local institutions 143 4.2.5 Summary and conclusion 149 5 Conclusion and discussion of results 153 5.1 Contribution to the field of economic geography 156 5.2 Practical implications and consequences for regional development policies 158 5.3 Limitations and Outlook 159 Appendix xiii List of references xvi Declaration on oath xxx iv List of Tables Table 1: Firms as actors in global production networks ......................................................................... 19 Table 2: Production versus knowledge relations in modular production systems ................................. 56 Table 3: Phases of modularization (Key actors and elements)............................................................... 63 Table 4: Illustration of the Coding Paradigm .......................................................................................... 88 Table 5: Overview empirical data base ................................................................................................ 104 Table 6: Overview combination and aims of different steps in the process of data analysis ............... 106 Table 7: Development of turnover and employment from 1995 -2016 .............................................. 112 Table 8: First Tier Structure of the production network ...................................................................... 121 Table 9: Processes of disembedding and re-embedding during modular transition ........................... 151 List of Figures Figure 1: Dimensions of a production system I ...................................................................................... 29 Figure 2: Dimensions of a knowledge infrastructure ............................................................................. 41 Figure 3: Infrastructures as distributions along a technical/social and global/local axes ...................... 43 Figure 4: Dimensions of a production system II ..................................................................................... 45 Figure 5: 4-level system architecture from a static (left) and dynamic perspective (right) ................... 50 Figure 6: Integrated system architecture (left side) versus modular system architecture (right side) . 51 Figure 7: Technological and organizational interfaces in modular systems ........................................... 53 Figure 8: Dimensions of a production system III .................................................................................... 57 Figure 9: Emergence of knowledge infrastructures ............................................................................... 62 Figure 10: Phases of modularization ...................................................................................................... 66 Figure 11: The inter-dimensional embeddedness of modularization processes.................................... 72 Figure 12: Multi-dimensional dynamical conceptual framework........................................................... 73 Figure 13: Open Coding in ATLAS t.i. (illustrative example) ................................................................... 87 Figure 14: Network view: Code-to-Code Links (Advanced phase of axial coding) ................................. 90 Figure 15: Phases of coding in qualitative data analysis ........................................................................ 91 Figure 16: Extract of geographical mapping of the Airbus production network .................................... 96 Figure 17: Global distribution of Airbus production network .............................................................. 109 Figure 18: National distribution of Airbus production network (EU) ................................................... 110 Figure 19: Division of labor and knowledge in the Airbus production network .................................. 111 Figure 20: Overview Airbus commercial aircraft production sites in northern Germany .................... 114 Figure 21: Agglomeration and Specialization of local supply base ....................................................... 115 v Figure 22: Open Integrated Modular Avionics ..................................................................................... 118 Figure 23: Main phases of modularization of Airbus industrial organizational model ......................... 122 Figure 24: Location and institutional background of standard setting organizations and regulatory agencies ............................................................................................................................................... 131 Figure 25: Dimensions of a knowledge infrastructure in the Aerospace Industry ............................... 133 Figure 26: Socio-technological trajectory of the A380 program .......................................................... 134 Figure 27: Local disembedding and global integration of the supply base in Hamburg .....................