New Product Development Capability Research Articles

The Impact of Company Resources and Capabilities on Global New Product Program Performance

Product innovation and the trend to globalization are two important and interrelated dimensions driving business today. In this article, the results of five published research articles on the topic of global new product development (NPD) are summarized to provide an integrated overview of the factors that impact global NPD program performance. The overall conceptual framework is based on three types of literature—NPD, globalization, and organization. The main theoretical approach for establishing relationships between factors is the dynamic capability/resource-based view. Accordingly, factors linked to outcome are seen as operating on different organizational levels, with more actionable initiatives or ‘capabilities’ largely mediating the softer and longer term background ‘resources’ of the firm. The analyses are based on a broad cross-industry sample of 467 firms (North America, Europe, B2B, goods/services). Three global NPD-related background resources (global innovation culture, resource commitment, and senior management involvement), labeled the ‘behavioral environment’ of the firm, are identified and shown to be linked to global NPD program performance via the mediated effect of four specific NPD capabilities (NPD process, strategy, team, and IT/communication). A qualitative synthesis of the findings is provided, along with recommended management initiatives with which firms can enhance their performance in the global NPD effort. Both sets of factors are found to be essential and highly interrelated, but it is the strength of the behavioral environment resources that distinguish the best performing firms, setting the stage for success in global NPD.

Improving Supplier New Product Development Performance: The Role of Supplier Development

Suppliers play an increasingly central role in helping firms achieve their new product development (NPD) goals. The literature implicitly assumes that suppliers are able to meet or exceed the quality standards and technological expectations of the firm, and yet, in practice, suppliers often lack the technological capabilities needed to undertake collaborative NPD. In such situations, a firm may choose to intervene and actively develop the supplier's technological and product development capabilities. We develop a theoretical framework that conceptualizes supplier development activities within interorganizational NPD projects as part of a bilateral knowledge‐sharing process: design recommendations, technical specifications, and new technology flow from supplier to the firm, and in turn, the firm can implement supplier development activities to upgrade the supplier's technological capabilities. Antecedents (supplier responsibility, skills similarity, single sourcing strategy) and consequences of supplier development activities (on supplier, product, and project performance) are examined using a sample of 153 interorganizational NPD projects within UK manufacturers. We find broad support for our hypotheses. In particular, we show that the relational rents (in the form of improved product and project performance) attained from supplier development activities in new product development are not achieved directly, but rather indirectly, via improvements in the supplier's creative and technological capabilities. Our results emphasize the importance of adopting a strategic view of the potential returns available from investing in the NPD capabilities of key suppliers, and provide clues about underlying reasons for the suboptimal experiences of many companies' collaborative NPD projects.

Searching for a Simple Model of Dynamic Capabilities

A fundamental issue for academics and practitioners is to better understand the nature and role of dynamic capabilities. Since dynamic capabilities have been viewed mostly as a “black box,” we first seek to identify, articulate, and propose a simple and measurable model of dynamic capabilities. Drawing upon the dynamic capabilities literature, we identify a set of capabilities - sensing the environment, learning, coordinating, and integrating - that are proposed to reconfigure existing operational capabilities into new ones that better match the environment. Second, to overcome concerns that dynamic capabilities are tautologically linked to performance and are only valuable in turbulent environments, we propose a structural model where dynamic capabilities indirectly affect performance in New Product Development (NPD) groups through the mediating role of operational NPD capabilities. The proposed indirect effect of dynamic capabilities on performance is also proposed to be moderated by environmental turbulence. Data from 180 NPD business units empirically support both the proposed simple model of the nature of dynamic capabilities and the structural model by which dynamic capabilities influence NPD performance through operational NPD capabilities in different levels of environmental turbulence. We discuss the study’s implications for better understanding the nature and role of dynamic capabilities.

Effects of relational proclivity and marketing intelligence on new product development

Purpose – A number of studies in the marketing and strategy literature show that a firm's resource endowment is a major driver in the formation of advantage-generating capabilities. Some researchers have suggested, however, that capabilities are path dependent and that a firm's behavioral predispositions and proclivities should be viewed as antecedents to capability formation. The purpose of this paper is to examine how a firm's behavioral tendencies, along with its existing business resources, contribute to the formation of new product development (NPD) capability. Design/methodology/approach – Hypotheses are tested by using survey data from more than 150 US-based firms. Structural equation modeling was used to evaluate the proposed model and analyze hypothesized relationships. Findings – Results of the paper suggest that a firm's competency in marketing intelligence and its tendency to engage in partner-style relationships have both direct and interactive effects on NPD capability. This capability is further shown to positively relate to organizational performance, and this relationship is moderated by technological uncertainty. Practical implications – The paper underscores that certain proclivities provide access to resources that reside outside a firm's boundaries and highlight the importance of considering firm proclivities in capabilities-based research. Originality/value – To date, little research has examined how NPD capability is influenced by a firm's internal marketing intelligence capability along with its tendency to seek external market knowledge. The examination of the direct and interactive effects of these constructs on NPD capability is novel and the findings highlight implications for scholars and practitioners alike.

What we will do versus what we can do: The relative effects of unit-level NPD motivation and capability

Although a firm's innovation performance has been commonly attributed to its innovative capability, in a study of 102 Chinese automobile assemblers, we find that employees' collective motivation for new product development (NPD) is more important than NPD capability in determining firms' innovation performance. This finding suggests that researchers need to simultaneously consider both unit-level capability and unit-level motivation in studying the mechanisms that drive innovation. Furthermore, our results indicate that a firm's strategic orientation focusing on NPD affects its employees' collective NPD motivation and NPD capability through relevant, mediating HRM practices. Copyright © 2013 John Wiley & Sons, Ltd.

IT investments and product development effectiveness: Iranian SBs

PurposeThe purpose of this paper is to examine if, and how, investments in IT at different levels can create new product development (NPD) capabilities in terms of IT leveraging competence in NPD and NPD effectiveness. The paper also investigates how Iranian small businesses (SBs) can achieve desired marketing performance through developing these capabilities.Design/methodology/approachThe paper is consistent with the perspective on IT‐enabled organizational capabilities. A questionnaire‐based survey was conducted to collect data from 218 businesses or NPD managers of SBs in Iran.FindingsIT leveraging competence in NPD and NPD effectiveness are valuable key capabilities that transform the value of IT resources to a firm's performance for Iranian SBs. Investments in both technical and human IT resources have positive effects on the development of NPD capabilities, and thus performance in the surveyed SBs.Research limitations/implicationsAmong other limitations, relying on a small sample size and cross‐sectional data of this research, and lack of generalizability of findings tend to have certain limitations.Practical implicationsThe results suggest that the investments in both technical and human IT resources increase firms' ability to develop effectiveness in NPD. However, IT investments strategy should be aligned with effective use of IT functionalities, as the effect of IT leveraging competence in development of NPD effectiveness is more pronounced. Second, IT leveraging competence in NPD and NPD effectiveness are important intermediate organizational capabilities through which the benefits of both technical and human IT resources are converted into performance effects at the firm level for Iranian SBs.Originality/valueThis case study explores how Iranian SBs can develop NPD capabilities, and subsequently, marketing performance, a topic that has received little attention to date.

Modelo de referência para o processo de desenvolvimento de produtos mecatrônicos (MRM): validação e resultados de uso

Este artigo apresenta o modelo de referência para o desenvolvimento de produtos mecatrônicos (MRM) enfatizando o trabalho de validação do modelo pela implantação de melhorias no processo de desenvolvimento de produtos (PDP) de uma empresa desenvolvedora. A aplicação e validação do modelo foi realizada por meio de uma pesquisa-ação. O conteúdo do modelo é sumarizado e sua metodologia de aplicação e validação é apresentada. As melhorias introduzidas aumentaram a capabilidade do PDP da empresa tanto na análise dos principais atores da implantação quanto para executores do processo não envolvidos na implementação. Estes últimos reportaram uma percepção de melhoria de indicadores de tempo, custo e qualidade do PDP. Os resultados mais significativos ocorreram no controle de documentos e configurações de produto e isso se deveu a aspectos regulatórios do mercado de equipamentos médicos. Embora tenha havido forte investimento em melhorias na área de gestão de projetos, seus resultados em controle de prazos e custos foram limitados por aspectos vinculados à integração entre as áreas de engenharia e marketing.

CAPABILITIES OF PRODUCT DEVELOPMENT PROCESS OF A FIRM: AN EMPIRICAL STUDY

Many researchers and industrial professionals recognize new product development (NPD) as a potential alternative for improving and sustaining competitive position in the market and made attempt to identify factors and variables that contribute to the capability of a firm in new product development. However, it is necessary to quantify these factors and variables in order to establish their relationships with the capability of NPD of a firm. Quantification of the factors is essential in order to achieve adequate control over the NPD activities. In this research work, a methodology is developed to quantify the factors and to establish empirical relationships of capability of NPD of a firm with its various main and support functions of new product development. In each of the selected function, the variables which contribute to NPD capability are identified by respondents/experts participated in a questionnaire survey. Out of the variables identified, three best variables are selected based on the importance assigned by the respondents. Utility functions and fuzzy analytical method are used for establishing the relationships between variables and the capabilities of the functions. The methodology is applied to an industrial product of a construction equipment-manufacturing firm that actively involves all the main functions and support activities as required for new product development. This methodology based on regression analysis may be used to monitor the product development process over a planning period on a continuous basis in a manufacturing firm.

SCM 협력, 신제품 개발, 조직문화의 관계

Although many prior studies have investigated the relationship between supply chain and new product development (NPD), the causal relationship between them has not been clearly established. Therefore, this study investigated systematically over the entire process of supply chain management (SCM) from trust to NPD capability, including not only the associations between trust, commitment, collaboration, supply chain quality, and NPD capability, but also the impact of organizational culture in the context of supply chain. In particular, this study examined the mediating effect of commitment on the relationship between trust and collaboration of channel members. In addition, it studies the moderating effect of organizational culture on the relationship between collaboration, supply chain quality, and NPD capability. Using a questionnaire survey, 112 usable responses are obtained. PLS (partial least square) is employed to assess the relationships among related constructs. The results of the data analysis show that (1) commitment mediates the link between trust and collaboration (2) supply chain quality is positively associated with NPD capability, and (3) organizational culture significantly moderates the association between collaboration and supply chain quality, yet it does not the relationship SC quality and NPD capability. Finally, the implications of the results are discussed, and directions for future research are suggested.

Climbing the value chain

PurposeIncreasing productivity gaps and declining manufacturing bases create complex challenges for mature small to medium enterprises (SMEs). One solution advocated by academia is to reposition along the value chain – moving to a position of greater value. The purpose of this paper is to examine strategies used by firms to reposition through creating a new product development (NPD) capability. In doing so, the paper seeks to resolve gaps in extant literature on NPD in mature SMEs.Design/methodology/approachAn exploratory approach is taken, analysing in‐depth case studies of three mature UK manufacturing SMEs.FindingsFour strategic approaches to enable the creation of a NPD capability (strategic alliances, licensing key technologies and ideas, outsourcing and deploying an internal development process) are found. Each may facilitate an SME to reposition but the findings highlight that these strategies are not mutually exclusive as different combinations were employed to accelerate and leverage change.Research limitations/implicationsLimited number of case studies constrains wider understanding despite providing richness. The findings highlight four different strategies for repositioning but there may be other routes.Practical implicationsDeeper understanding of how to climb the value chain, providing valuable lessons for mature SMEs facing a need to reposition to generate new growth opportunities.Originality/valueThe paper provides an understanding of how mature manufacturers utilise different strategies to overcome resource constraints and generate a NPD capability to assist in repositioning. This resolves weaknesses in current literature that so far have not adequately examined the process of shaping a NPD capability and the strategies used to reposition.

An integrated framework for new product development using who-when-where-why-what-how (5W1H), theory of inventive problem solving and patent information – a case study

Companies are not expected to compete and survive with their same/similar products in today's dynamic and turbulent market conditions. Therefore, companies are in search of an agile new product development (NPD) approach in order to respond to rapid changes in the market without ignoring innovativeness as well. Beside these considerations, the companies are still calling for a cheap, robust and fast available method which can enhance the whole product development process. The existing NPD capabilities of the companies would be better to be utilised in order to overcome the well-known obstacles. There are a lot of creativity management tools, techniques and sources available without additional charge in order to achieve the above purpose. It should be noted that those tools and techniques are quite similar with special pros and cons of each. In this article, a novel framework is proposed for NPD process that integrates three of those techniques. The proposed framework merges theory of inventive problem solving methodology with a patent alarm system which enables tracking of 'trend changes' in patenting activities. It also introduces a modified idea-generation scheme with who- when- where- why- what- how (5W1H) methodology that helps companies to drive inventions/innovations and inspires ideas that escape from 'ordinary' and 'linear' thinking.

Creating a New Product Development capability: the organisational enablers for moving up the value chain

The UK's innovative and productive performance remains a subject of considerable concern, not least because of its increasing productivity gap, but also because of concerns relating to manufacturing's reliance on gaining process efficiencies. Resolution of this position has been argued to involve a move up the value chain, through such means as New Product Development (NPD). Many examples of 'good' NPD practice exist within the literature. However, these examples and the associated determinants of NPD success principally focus on large organisations. In this paper, SMEs are argued as being different in their approach to developing new products, specifically focusing on their journey to create a NPD capability. This exploratory research incorporates two detailed case studies on UK based manufacturing SMEs in order to contribute to new knowledge and understanding, by identifying the key enablers to create a NPD capability.

Successful Product Development after Firm Acquisitions: The Role of Research and Development

A major reason for carrying out a merger and acquisition (M&A) is to gain access to technological knowledge and to increase new product development (NPD) capabilities. To achieve the desired effect of improving a firm's capacity for innovation, this knowledge must be combined with the acquiring firm's existing resources. Previous research, however, has made it clear that M&A transactions tend to disrupt a company's innovation processes, resulting in reduced investment in research and development (R&D) activities as well as a lower innovative output in terms of patents and new products introduced to the market. In this regard, a successful postmerger integration of the firms' R&D units plays a decisive role. Conceptually, this exploratory article distinguishes between the strategic approach to integration and the integration instruments or measures to be employed within the approach. Whereas the former sets the general strategic direction of the integration or, in other words, establishes some kind of acquisition posture, the latter describe the relevant fields or dimensions to be addressed during integration. These integration strategies and instruments are subsequently investigated in a sample of 35 M&A transactions. It is shown that companies typically revert to three distinct integration strategies, depending on the need for strategic interdependence and organizational autonomy: symbiosis, absorption, and adjustment. Together with the integration instruments that relate to structural linking, process redesign, systems standardization, and culture building, the integration strategies are analyzed using seemingly unrelated regression models. It turns out that technological success and, hence, NPD capabilities benefit most from a symbiosis and an absorption strategy. Apparently, only wide‐ranging reorganization efforts in R&D focussing on common structures, processes, and systems can fully realize the benefits from a combination of resources. To achieve economic success or high integration quality, an adjustment strategy appears to be the best choice as reorganization efforts are rather limited. With respect to the integration instruments, the research shows that the structural linking exhibits a great impact on technological and economic success but no effect on integration quality. Obviously, common structural patterns and interlinked structures within the R&D units have a positive effect in that they facilitate better collaboration and research outcomes. A common organizational structure hence serves as a basis for realizing innovative resource combinations and streamlining the NPD process. A standardization of systems exhibits strong positive links with all success variables. Apparently, a consistent unification, offering orientation and comparability, is of high importance to achieve the best possible implementation of the integration and to foster innovative capabilities. Significant effects of culture building can be substantiated for economic success. Moreover, there tends to be a positive effect on integration quality. This underpins the importance of measures to encourage the build‐up of a common corporate culture. To sum up, the research provides a couple of insights on how to strengthen NPD capabilities following a merger.

A Hierarchical Product Development Planning Framework

Uncertainty in new product development (NPD) planning embraces market, creative, technological, and process dimensions to a much greater extent than in non‐NPD project planning. Yet, NPD management is becoming increasingly decentralized, both within the firm and across the supply chain. Hence, planning for NPD uncertainty often results in path‐dependent scenarios cutting across the strategic, tactical, and operational levels of planning. To coordinate this resulting complexity, we propose a stochastic hierarchical product development planning framework with multiple recourses, i. e., corrective actions, to maximize performance across a firm's entire NPD program. We also argue the necessity for a fourth planning level, the infrastructural, that reestablishes norms for market projections, technological forecasts, scheduling, and requirements as latent uncertainty in the environment is continually revealed. An illustration from the automotive industry is presented to demonstrate a deployment of our framework. We additionally discuss the applicability of this framework for managing NPD capabilities over time.