Stage-Specific Effects of Organizational Structure and Boundary-Spanning on the Performance of New Product Development Teams

Abstract

In this paper, we analyze the influence of organizational design and boundary-spanning activities on the performance of new product development teams, differentiated by the stage of the innovation process. The organizational antecedents considered are organic vs. mechanistic tructures of such teams. It is proposed that due to differing information needs and different levels of uncertainty, organic structures are more suited in the early initiation stage, while mechanistic structures are more appropriate in the following implementation stage. Boundary spanning is proposed to influence performance positively in both the early and the late stage. We test our hypotheses using a sample of 133 new product development (NPD) projects. The analysis yields that not all organic structures are beneficial (detrimental) to the early (late) stage. Similarly, not all mechanistic structures are beneficial (detrimental) to the late (early) stage. This suggests that a more differentiated approach to the organizational design of NPD teams is needed. As proposed, boundary-spanning activities are positively associated with team performance in both project stages. Managerial implications and directions for future research are discussed.