Learning from Failure, Collective Efficacy and New Product Performance

Abstract

Although the virtues of the learning from failure in breeding innovation have been widely promoted, teams are still an under-researched objective when it comes to learning from failure. Moreover, much less is known about how team learning from failure affects innovation performance especially under the influence of collective cognition. Incorporating social learning theory and social cognitive theory, our study examines how experiential learning from failure (ELFF) and vicarious learning from failure (VLFF) affect new product performance (NPP) in new product development (NPD) teams. We further explore the moderating role of collective efficacy. Survey data from 152 paired NPD project teams in high-tech firms illustrates that both ELFF and VLFF facilitate NPP in terms of NPD speed to market and new product creativity. Further, a high level of collective efficacy intensifies the positive relationship between ELFF and NPD speed to market, but attenuates the positive relationship between VLFF and new product creativity. Our results illustrate that both ELFF and VLFF should be encouraged to promote innovation performance in the NPD team. However, the NPD team should hold a fine-grained view regarding the double-edged sword effect of collective efficacy on the relationship between learning from failure and NPP at the team level.