New product development period and competitive advantage resulting from manufacturing-marketing interaction: an empirical study of SMEs in the Yangtze Delta in China

Abstract

To better understand the advantages and disadvantages of manufacturing-marketing interaction (MMI) in new product development (NPD), this paper focuses on verification of project period dimension and product competitive advantage which is one dimension of possible benefit from MMI in NPD. A path analysis of data from 322 small and medium enterprises (SMEs) in the Yangtze Delta which have completed NPD projects shows that increased MMI at each stage of product development is associated with greater product competitive advantage, which in turn is associated with high project return on investment (ROI). While the results of our analysis indicate that MMI is associated with almost all NPD performance dimensions as expected, the results indicate that the influence of MMI on project ROI is much more strongly positive than negative. MMI is strongly associated with greater product competitive advantage, which in turn is a strong driver of ROI. Although MMI is also associated with longer project period, at least in market analysis and product commercialisation project stages, the impacts of these associations on ROI appear to be negligible. Thus, the total effect of MMI on ROI is strongly positive.