Antecedents and performance consequences of external involvement in new product development

Abstract

This study enriches the external involvement literature, through examining the impacts of demand uncertainty, supply uncertainty, technology uncertainty, top management support and information technology (IT) implementation on two dimensions of external involvement, and the effect of external involvement on firm performance. We propose and empirically test a comprehensive model using data collected in Chinese manufacturing companies. Our findings indicate that technology uncertainty and top management support have positive impacts on both customer involvement and supplier involvement. IT implementation has a significantly positive impact on customer involvement but has no significant impact on supplier involvement. The results also suggest that demand uncertainty and supply uncertainty do not impact on either customer involvement or supplier involvement. Both customer involvement and supplier involvement can improve firm performance significantly.