Employee Collaboration, Learning Orientation, and New Service Development Performance

Abstract

Businesses rely on knowledge interfaces to gather and integrate knowledge that drives innovation and builds competitive advantage. But key knowledge interfaces such as cross-functional teams (CFTs), frontline employees (FLEs), and learning orientation have not shown consistent effects on innovation outcomes in prior research. This study addresses that problem by testing a mediation model that extends the service-dominant logic service innovation framework developed by Ordanini and Parasuraman. Based on analyses of 160 new service development (NSD) projects, the authors find that CFTs, FLEs, and learning orientation consistently influence NSD sales and process efficiency outcomes when they first create a service having (1) superior attributes and expert frontline employee service delivery (service marketability) and/or (2) a well-targeted launch with formal promotion to internal and external markets (launch effectiveness). Those NSD project characteristics in turn yield favorable new service performance results. Specifically, service marketability and launch effectiveness mediate the influence of CFTs on NSD outcomes. Launch effectiveness mediates the influence of learning orientation, and service marketability mediates the impact of FLEs. In ranking the organizational resources, the study finds that CFTs and learning orientation have greater effect on NSD sales performance than do FLEs. The results highlight the importance of aligning CFTs, FLEs, and learning orientation with NSD project characteristics in order to maximize sales performance and process efficiency.