bluuebunny/crossref_metadata_2025 huggingface dataset:
An Ecological Perspective on New Product Failure: The Effects of Competitive Overcrowding
Authors: Redmond William H.
Published: October 2003

Practitioners and researchers have carefully explored the causes of new product failures. Studies have been conducted, results analyzed, and recommendations offered. Yet despite these efforts, new product failure rates have not decreased. In fact, they appear to be increasing in some product categories. Are we missing something?

Noting that most research on new product failures has focused on a firm's activities in specific projects, William H. Redmond proposes that new product outcomes might also be influenced by macro‐level or environmental factors. By focusing on environmental factors rather than a firm's activities in specific projects, we might better understand why competent firms in one industry consistently experience higher failure rates than those of firms that are no more competent, but operate in a different industry. For example, failure rates for new food products are consistently higher than those for new industrial products. With no evidence that product development professionals in industrial firms are simply superior to their counterparts in the food industry, Dr. Redmond suggests that we need to look beyond specific product development projects and consider the effects of the market in which these products are introduced.

Encouraged by past successes, many firms in the food manufacturing business seek sales growth through the development and introduction of additional new products. Over time, this creates a market in which customer demand is fragmented into increasingly small niches and distribution channels are flooded with product choices. As a result, the failure of a new product is more likely than it might have been under less crowded conditions. In much the same way that the population of deer on an island is limited by the available food and physical space, food products are apparently faced with the market equivalent of natural selection. In the absence of available market niches and a clear competitive advantage, a new product's chances for success are meager. In a market that is overcrowded by existing products and new product introductions, it becomes increasingly difficult and uneconomical to identify opportunities for meaningful differentiation.

On the other hand, industrial products face a much different set of environmental conditions. Compared to the food manufacturing business, relatively few new industrial products are introduced, and those introductions are typically successful. In most cases, the new products are simply replacements for inefficient or obsolete products. In such an environment, failed introductions are probably the result of errors in the product development process.
From Experience Dreams to Market: Crafting a Culture of Innovation
Authors: Zien Karen Anne , Buckler Sheldon A.
Published: October 2003

Do certain common principles guide uncommonly innovative companies down the risk‐riddled road to value creation? Or do successful innovators break boldly through the barriers to new product development along pathways of their own unique making? Karen Anne Zien and Sheldon Buckler discern a strikingly consistent model of how companies craft and sustain cultures in which innovation is nurtured, rewarded, even demanded.

An article by the authors in the September 1996 issue of JPIM recounts seminal tales from the cultures of innovation consciously nourished by 12 leading‐edge corporations in the United States, Europe, and Japan. Gathered through an extensive series of interviews with key personnel in the management, technical, manufacturing, and marketing divisions of each firm, the stories revealed seven traits widely shared from one company to the next, irrespective of business focus, geography, or nationality. These traits, as discussed in this article, not only serve to reconcile the culturally contradictory demands of the three critical stages of innovation—the “fuzzy front end,” the product development process, and marketplace operations—but also condition the company as a whole to sustain its innovative capacity over time.

The principles at work in highly innovative companies encompass corporate as well as individual attitudes and behaviors. On the one hand, company leaders demonstrate in every decision, action, and communication that innovation propels profitability. So, for the CD project at Sony, the R&D general manager heeded “a voice from above that does not question the possibilities and absolutely believes” in the potential of the enterprise.

On the other hand, actively helping individuals create a linkage between their “work life” and longer term “life work” is a crucial step in generating an environment where innovation and high productivity flourish together. Thus, a divisional chief executive at ICI/Imperial Chemicals Industries recognizes the need to “create an environment where people will work at what they are best at doing and what they like doing best.”

Although the trail to successful innovation inevitably follows the unique contours of any company's environment, some universal guideposts point the way.
Teamwork Barriers in Japanese High‐Technology Firms: The Sociocultural Differences Between R&D and Marketing Managers
Authors: Song X. Michael , Parry Mark E.
Published: October 2003

Building and maintaining internal harmony is a fundamental concern for managers in many Japanese firms. Discussions of Japanese management practices often point to the intense socialization of new recruits, the rotation of employees through different functions, and the significant role of seniority in determining salary levels and promotions. Considering this emphasis on harmony, can we reasonably assume that the orientations of Japanese R&D and marketing managers do not differ in any ways that may pose significant barriers to teamwork between their departments?

X. Michael Song and Mark E. Parry test this assumption by examining the sociocultural differences between R&D and marketing managers in Japanese high‐technology firms. Using responses from both R&D and marketing managers in 223 firms, their study groups the respondents’ employers as either low‐ or high‐integration firms. They examine the sociocultural differences between the R&D and marketing managers in the study along five dimensions: time orientation, bureaucratic orientation, professional orientation, tolerance for ambiguity, and preferences for high‐risk, high‐return projects.

Contrary to expectations, the responses reveal several significant differences between the R&D and marketing managers in this study. Compared to their colleagues in marketing, the Japanese R&D managers in this study generally have a stronger preference for high‐risk, high‐return investments. The R&D managers in the study also have a longer time orientation than the Japanese marketing managers. However, marketing managers from the high‐integration firms in the study have a longer time orientation than their counterparts in low‐integration firms. Compared to the R&D managers, Japanese marketing managers in the high‐integration firms studied have a greater tolerance for ambiguity. And relative to managers in low‐integration firms, marketing and R&D managers in the high‐integration firms in this study typically have a more bureaucratic organization.

Perhaps most important, a significant number of R&D managers in this study perceive the marketing managers in their firms to have higher organizational status. Specifically, responses from R&D managers indicate that they perceive their marketing colleagues to have higher salaries, more power, and brighter career prospects. Such perceptions may foster morale problems among R&D professionals in these Japanese firms, and thus require management intervention to ensure that R&D performance does not suffer.
Incapability of Technological Capability: A Case Study on Product Innovation in the Japanese Facsimile Machine Industry
Authors: Kusunoki Ken
Published: October 2003

Technological leadership in an industry certainly seems like a ticket to ongoing success. However, overemphasis on existing technological capabilities may produce a form of myopia in product development. In other words, by focusing primarily on developing and improving their core technologies, organizations miss opportunities to exploit new technologies and thus create breakthrough products.

Ken Kusunoki proposes that problem‐solving approaches in a technologically leading firm paradoxically may impede radical product innovation. Suggesting that such firms are inherently oriented toward incremental innovation, he presents a conceptual framework of the dynamic interaction between technological and product development problem‐solving in the context of product innovation. He then illustrates this conceptual framework by examining a case of radical innovation in the Japanese facsimile industry.

For a technological leader, product innovation typically is driven by technology development. In other words, such a firm quite reasonably relies on the technological advantage it holds over competitors as the basis for its product developments. By refining and enhancing its industry‐leading technological capabilities, the firm can successfully introduce incremental innovations in its products. Because of this strong emphasis on exploiting existing technological capabilities, however, the technological leader may fail to capitalize on new technologies that can produce radical innovations.

In the race to develop high‐speed, digital facsimile equipment during the early 1970s, for example, Matsushita held a decided technological advantage over competitors such as Ricoh. Notwithstanding Matsushita's technological edge, however, Ricoh brought this radical innovation to market two years before Matsushita introduced its first digital machine, causing a serious decline in Matsushita's market share.

Ricoh's approach to technological and product problem‐solving—an autonomous team structure, with a strong project manager and frequent transfers of engineers among interdependent units—contrasts dramatically with Matsushita's functional structure and strong emphasis on technological problem‐solving. Interestingly, Matsushita regained its technological advantage by 1976, thanks to a rapid series of incremental innovations in its product technologies.
The Keisho1 of Development Technology: The Case of the Japanese Aircraft Industry
Authors: Nakayama Takashi
Published: October 2003

In many respects, development of highly innovative products such as fighter aircraft comes down to a quest for technological superiority. If such products lack best‐in‐class technologies, they face almost certain defeat at the hands of the competition (or, in the case of fighter aircraft, the enemy). In addition to the latest and greatest technologies, however, this type of development effort must draw on the past.

Takashi Nakayama explores the role that keisho—or inheritance—of development technology plays in the Japanese aircraft industry. He illustrates the concept of keisho through examples ranging from the projects that culminated in development of the famed Zero fighter aircraft during the 1930s to those that produced the FSX (recently renamed the F‐2) support fighter during the 1990s. Drawing on these historical perspectives, he addresses three key questions regarding keisho. First, why do Japanese manufacturers insist on keisho of development technology, even in the development of the latest aircraft? Second, what does the term development technology mean? And finally, how is keisho of development technology to be carried out? He then presents two models to show how keisho of development technology is carried out under different circumstances.

The term development technology refers to the tacit knowledge that each member of the organization brings to a development effort. In other words, development technology comprises fieldwork knowledge, which consists of intuition, experience, and analogy. In essence, development technology represents the insight necessary for understanding the overall circumstances of a project and actively reframing or integrating various technologies to fit the needs of that project.

During a development effort, each member of the organization internalizes this tacit knowledge (that is, development technology). By retaining and assigning these people to subsequent developments, an organization carries out the keisho of development technology. In this straight inheritance (optimal) model of keisho, engineers move from a completed project to another large‐scale, next‐generation project, continually using, refining, and enhancing the tacit knowledge shared by all members of the organization. The result is successive generations of new, excellent products. In intermediary inheritance (the minimal requisite keisho model), the core of development technology is inherited through various medium‐scale intermediate projects, rather than directly from one large‐scale project to the next.
Success Through Customer‐Driven New Product Development: A Comparison of U.S. and New Zealand Small Entrepreneurial High Technology Firms
Authors: Souder Wm. E. , Buisson David , Garrett Tony
Published: October 2003

Although high‐tech, entrepreneurial firms may be small in size, they often play a large role in developing innovative products and thus spurring economic growth. Managers from firms of all sizes may gain useful insights by examining the new‐product development (NPD) practices of these small, technology‐based firms. And in an era of increasingly global competition, those managers can benefit from understanding the NPD practices of firms from various countries.

William Souder, David Buisson, and Tony Garrett contribute to that understanding by describing the results of a study that compares the relative NPD proficiency of small, technology‐based firms in the United States and New Zealand. The firms participating in the study (26 from the U.S. and 29 from N.Z.) operate in rapidly growing, highly competitive markets characterized by evolving customer needs. The participating companies share similar goals: creating technically superior products with unique features for emerging markets, with the ultimate goal of becoming the product and market leaders within their respective industries. Despite these similarities, the study reveals several important differences between the U.S. and N.Z. participants.

Overall, the N.Z. respondents had higher levels of NPD performance than those of their U.S. counterparts. In particular, the relationship marketing and customer‐focused NPD practices of the N.Z. firms set them apart from the U.S. firms. Top‐level managers from the N.Z. participants report higher levels of satisfaction than their U.S. counterparts with the results of their NPD efforts.

The results of the study indicate that repondents from the two countries differ in terms of the focus of their NPD mangement systems and the manner in which they strive to achieve success. For the U.S. firms in the study, their NPD management systems focus on the characteristics of the project manager. The N.Z. respondents place greater emphasis on marketing skills and NPD proficiencies. The results suggest that the higher levels of NPD performance acheived by the N.Z. firms in the study arise from greater insights into their users' needs, together with better capabilities for acting on those insights.
Adoption of New Products by the Sales Force: The Construct, Research Propositions, and Managerial Implications
Authors: Atuahene‐Gima Kwaku
Published: October 2003

Some firms take salesforce commitment to any new product as a given, seemingly adopting the attitude, “If we build it, they will sell.” However, management has no guarantee of salesforce commitment to a new product. For various reasons, salespeople may fail to sell a new product, or they may engage in dysfunctional behavior during the selling process—for example, misrepresenting the product's benefits to gain short‐term sales. Ensuring salesforce adoption of a new product requires careful consideration of the characteristics of the product, the competitive environment, the firm, and the members of the salesforce. In other words, managers who hope to engender support for a new product would do well to view the salespeople as a first line of customers.

Successfully launching a new product to the company's salesforce requires the same high levels of creativity, energy, and managerial insight as does the product's launch into the marketplace. Consequently, managers and researchers need to examine more closely the factors underlying the successful launch of a new product to a firm's salesforce. As a first stop toward gaining greater insight into those factors, Kwaku Atuahene‐Gima develops a model for exploring the characteristics that affect new‐product adoption by the salesforce.

His model suggests that a salesperson's commitment to a new product depends, to a large extent, on the salesperson's learning style, performance orientation, and problem‐solving style. For example, he proposes that, compared to their colleagues with systematic problem‐solving styles, salespeople with intuitive problem‐solving styles are more likely to adopt a new product and are less likely to engage in dysfunctional behavior in the selling process.

The model also suggests that the salesforce's perceptions of the firm's commitment to new products, tolerance for failure, and attitude toward intradepartmental conflict during the product development process play key roles in determining whether the salesforce will take an active, positive approach to selling the new product. For example, a firm that views occasional failures as opportunities for learning and growth offers an environment in which salespeople can accept the risks that selling a new product entails. The proposed model also takes into account the moderating effects of the product's innovativeness, the intensity of market competition, and the type of sales control systems that the firm uses.
Evaluating Customer Support During New Product Development—An Exploratory Study
Authors: Goffin Keith
Published: October 2003

Anyone who has struggled with a balky computer understands the importance of product support. Useful support for a high‐tech product may take various forms, including installation, documentation, field service, user training, and product upgrades. All these forms of support share a common goal: achieving customer satisfaction with the product. To increase the likelihood of customer satisfaction with a high‐tech product, a firm must carefully consider the product's support requirements during the design stage of the new‐product development (NPD) effort.

As Keith Goffin points out, however, relatively little research has been published about the manner in which product design influences product support. He suggests that firms may benefit from considering product support requirements during the design stage, in much the same way as design for manufacturability (DFM) techniques enable firms to increase ease of manufacture. In a survey of high‐tech firms, he explores the ways in which companies evaluate product support requirements during the design stage. The study also examines whether firms use quantitative goals to focus the design team's attention on a product's support needs. To provide deeper understanding of the interrelationship between support requirements and product design, he also presents a case study involving Hewlett‐Packard's development of a complex medical device.

With responses from 66 companies, the survey offers the first empirical data on how companies plan for product support. Whereas DFM techniques involve consideration of manufacturability during the early stages of design, more than two‐thirds of the companies in the study begin planning for support during the second half of the product development process. Only slightly more than one‐half of the respondents report the use of a formal product support plan, although use of this type of document is more prevalent among the computer firms in the study.

The companies in this study do not consider all aspects of support during product planning. The respondents also do not set quantitative goals for all aspects of support during the design stage. They typically set quantitative goals for service‐related aspects of support—for example, product reliability targets such as annual failure rate—rather than for such support areas as user training. The survey responses identify a range of measures which could be used for performing a more comprehensive evaluation of support requirements during the design stage.
Towards Holistic “Front Ends” In New Product Development
Authors: Khurana Anil , Rosenthal Stephen R.
Published: October 2003

Any firm that hopes to compete on the basis of innovation clearly must be proficient in all phases of the new‐product development (NPD) process. However, the real keys to success can be found in the activities that occur before management makes the go/no‐go decision for any NPD project. In other words, the most significant benefits can be achieved through improvements in the performance of the front‐end activities—product strategy formulation and communication, opportunity identification and assessment, idea generation, product definition, project planning, and executive reviews.

Noting the inherent difficulty of managing the front end, Anil Khurana and Stephen R. Rosenthal discuss findings from in‐depth case studies of the front‐end practices in 18 business units from 12 U.S. and Japanese companies. They offer a process view of the activities that the front end comprises, and they discuss the insights that their case studies provide regarding key success factors for managing the front‐end activities. The case studies involved companies in industries ranging from consumer packaged goods to electronics and industrial products.

Foremost among the insights provided by the case studies is the notion that the greatest success comes to organizations that take a holistic approach to the front end. A successful approach to the front end effectively links business strategy, product strategy, and product‐specific decisions. Forging these links requires a process that integrates such elements as product strategy, development portfolio, concept development, overall business justification, resource planning, core team roles, executive reviews, and decision mechanisms.

The case studies suggest that firms employ two general approaches for achieving these links. Some companies rely on a formal process to lend some order and predictability to the front end. Other companies strive to foster a company‐wide culture in which the key participants in front‐end activities always remain focused on the following considerations: business vision, technical feasibility, customer focus, schedule, resources, and coordination. This cultural approach is more prevalent among the Japanese firms in the study; the U.S. firms tend to rely on formality of the front‐end process. The case studies also suggest that the front‐end approach must be compatible with the firm's product, market, and organizational contexts. For example, standardized approaches seem to work best for incremental innovations.
Book Reviews
Authors: Rosenau Milton D. , Rothberg Robert R.
Published: October 2003

The first review discusses a provocative book about innovation and the impact of technological change. Although the book also provides all readers with an invaluable historical perspective, the reviewer believes that it lacks predictive utility for practitioners. The second review covers a book devoted to strategic breakthroughs. The reviewer finds that the focus on the customer and the role of top management can be valuable for practitioners. The third review describes a book covering competitive advantage. Our reviewer praises the book highly, finding it of particular value for practitioners, both seasoned and novice. The fourth review is of a book devoted to improving new product development. The reviewer recommends the book as providing detailed practical guidance.

This issue also reviews two new books of special interest to professors. The first, by Robert Dolan, is a short text‐and‐cases book dealing with new product development and commercialization, primarily from the standpoint of strategic needs, data sources, and decision analytic methodologies. The second, by Richard Nelson, is a compendium of thoughtful essays dealing with the national innovation systems of fifteen different countries.
Analyses of U.S. and Japanese Management Processes Associated with New Product Success and Failure in High and Low Familiarity Markets
Authors: Souder Wm. E. , Song X. Michael
Published: October 2003

As detailed in the pages of JPIM and other publications, considerable research effort has been devoted to identifying the preconditions for new product success. Studies of Japanese and U.S. new product development (NPD) practices have shown that such factors as sales and marketing expertise, technical expertise, decentralized decision making, R&D/marketing integration, project manager competency, and support from senior management can play key roles in influencing new product success.

As William Souder and X. Michael Song point out, however, previous studies have not examined Japanese management practices across a range of environments. They also suggest that the similarities and differences between U.S. and Japanese NPD practices require more in‐depth exploration. To help address these issues, they describe the results of a study involving 15 U.S. firms and 15 Japanese firms. Each participating firm provided information about two successful products and two unsuccessful products.

Their conceptual model groups the various factors that influence new product success into three general classes: NPD climate, expertise, and management functions. In this model, a firm's level of familiarity with its target market moderates these influences. For example, greater expertise may be necessary to succeed in an unfamiliar market. Each participating firm in the study provided information about one successful product and one failure targeted for high familiarity markets; the other two products from each firm were targeted for low familiarity markets.

The U.S. and Japanese models developed in this study exhibit some marked differences from one another. In a familiar market, the U.S. model emphasizes sales and marketing expertise and competent project managers. Under conditions of low market familiarity, this basic model is supplemented with high degrees of R&D/marketing integration, senior management involvement, and decentralization. In this way, the U.S. models reflect a degree of flexibility in adapting the approach to match the prevailing market conditions. In contrast, the two Japanese models of new product success (under low and high familiarity) point to a more invariant system. In other words, the findings from this study reinforce the notion that successful management of NPD requires careful consideration of the firm's environment. Practices that have been proven successful in a particular culture and market environment may not be directly transferable to another setting.
New Product Development in Rapidly Changing Markets: An Exploratory Study
Authors: Mullins John W. , Sutherland Daniel J.
Published: October 2003

Rapid technological change can be both a blessing and a curse. For example, investors and firms of all sizes hope to reap the rewards that may arise from the apparent convergence of the computer, telecommunications, and entertainment industries. With the high level of uncertainty inherent to such rapidly changing markets, however, those potentially dazzling returns are counterbalanced by a daunting level of risk.

John Mullins and Daniel Sutherland suggest that firms operating in such markets require NPD practices that can mitigate risk, manage uncertainty, and, of course, increase the likelihood of new product success. To gain insight into the NPD practices that can meet those challenges, they conducted in‐depth interviews with managers who were directly involved in NPD projects at US WEST, Inc., a large, multinational firm in the telecommunications industry. The study focused on identifying practices that help the firm bring new products into rapidly changing markets quickly, efficiently, and effectively. A key objective of their study was to go beyond the basics—for example, the use of cross‐functional teams—to identify specific practices that allow the firm to address the various levels of uncertainty that characterize its markets.

They identify three levels of uncertainty that confront firms operating in rapidly changing markets. First, potential customers cannot easily articulate needs that a new technology may fulfill. Consequently, NPD managers are uncertain about the market opportunities that a new technology offers. Second, NPD managers are uncertain about how to turn the new technologies into products that meet customer needs. This uncertainty arises, not only from customers' inability to articulate their needs, but also from managers' difficulties in translating technological advancements into product features and benefits. Finally, senior management faces uncertainty about how much capital to invest in pursuit of rapidly changing markets as well as when to invest.

The study identifies six practices that help the firm address the uncertainty and risk inherent in its rapidly changing markets. For example, market research in this firm's NPD process focuses more on probing than it does on measuring. Involvement of prospective customers in idea generation and the use of prototypes early in the NPD process help the firm uncover customer needs and market opportunities. Large‐scale, quantitative market research focuses primarily on determining market size and price points.
An Examination of Collaboration in High‐Technology New Product Development Processes
Authors: Jassawalla Avan R. , Sashittal Hemant C.
Published: October 2003

For more than a decade, researchers have explored the benefits of eliminating organizational boundaries between participants in the new product development (NPD) process. In turn, companies have revamped their NPD processes and organizational structures to deploy cross‐functional teams. These efforts toward interfunctional integration have produced a more responsive NPD process, but they don't represent the endgame in the quest for more effective NPD. What's next after the interfunctional walls come down?

Pointing out that many high‐tech firms have already taken such steps as integrating customers and suppliers into the NPD process, Avan Jassawalla and Hemant Sashittal suggest that such firms need to go beyond integration and start thinking in terms of collaboration. Using information from a study of 10 high‐tech industrial firms, they identify factors that seem to increase cross‐functional collaboration in NPD, and they develop a conceptual framework that relates those factors to the level of cross‐functional collaboration achieved in the NPD process.

Compared to integration, collaboration is described as a more complex, higher intensity cross‐functional linkage. In addition to high levels of integration, their definition of cross‐functional collaboration includes the sense of an equal stake in NPD outcomes, the absence of hidden agendas, and a willingness on the part of participants to understand and accept differences while remaining focused on the organization's common objectives. Collaboration also involves synergy—that is, the NPD outcomes exceed the sum of the capabilities of the individual participants in the NPD process.

Their framework suggests that structural mechanisms such as cross‐functional teams can provide significant increases in NPD‐related interfunctional integration. However, high levels of integration do not necessarily equate to high levels of collaboration. Characteristics of the organization and the participants also affect the level of collaboration. For example, achieving a high level of collaboration depends on participants who contribute an openness to change, a willingness to cooperate, and a high level of trust. Their framework also points to key organizational factors that affect the level of collaboration—for example, the priority that senior management gives to NPD and the level of autonomy afforded to participants in the NPD process.
Some Approaches to Complementary Product Strategy
Authors: Sengupta Sanjit
Published: October 2003

Without complementary products, many high‐tech innovations might be relegated to the scrap heap. For example, the development of desktop computers was not the sole impetus for the personal computing revolution. This innovation also depended on the development of word processing, spreadsheet, and desktop publishing software, as well as peripheral devices such as laser printers. Development of complementary products clearly offers increased opportunities for firms in many high‐tech markets. However, managers must balance those opportunities with the added risks their firms face in attempting to develop products that may extend beyond their core lines of business.

Focusing on the early business analysis stage of the product development process, Sanjit Sengupta identifies some alternative approaches that firms use for developing and marketing complementary products. Using data from 103 projects in the computer, consumer electronics, software, and communications industries, his study explores the relationships between a firm's complementary product strategy and such conditions as complementary product opportunity, organizational fit, and the multiplier effect of the complementary product on sales of the primary product. His study also examines the sources of competitive advantage in complementary product strategies.

Contrary to the notion that only large, well‐funded firms can pursue a complementary product strategy, the study identifies various alternatives to expensive, in‐house development efforts. Depending on the level of resources available for a particular project, a firm may choose various modes for adopting a complementary product strategy, including co‐development alliances, proprietary interface development, co‐marketing alliances, and original equipment manufacturer (OEM) agreements.

Findings from this study indicate that competitive advantage in complementary product strategy comes from the multiplier effect on sales of the primary product and from the innovativeness of the complementary product. Even if the complementary product has low sales potential by itself, the product may still offer a significant competitive advantage through its multiplier effect on the sales of the primary product. Somewhat surprisingly, the results suggest that organizational fit and complementary product opportunity have no effect on competitive advantage. However, organizational fit does appear to be an important condition for adopting a complementary product strategy. (c) 1998 Elsevier Science Inc.
Innovation Strategy and Sanctioned Conflict: A New Edge in Innovation?
Authors: Dyer Barbara , Song X. Michael
Published: October 2003

Teamwork and harmony are worthy objectives, but a healthy dose of conflict also plays an important role in fostering innovation. In their pursuit of teamwork and harmony, companies run the risk of suppressing the creative tension that brings vitality to new‐product development (NPD) efforts. Furthermore, a firm's choice of innovation strategy may have a significant effect on the organization's capability for managing conflict.

Using results from a survey of 290 marketing and R&D managers from U.S. firms in the electronics industries, Barbara Dyer and X. Michael Song explore the link between strategy and conflict, and the effect this link has on NPD success. Their study examines the following issues: the influence of business strategy on specific conflict‐handling behaviors; the relationship between those conflict‐handling behaviors and positive conflict outcomes; and the relationship between constructive conflict and new‐product success. The study classifies firms predominantly pursuing a more aggressive NPD strategy as prospectors and less aggressive firms as defenders. Three conflict‐handling mechanisms are identified: integrating behaviors, forcing behaviors, and avoiding behaviors.

Compared to the prospector firms, the defender firms in this study perceived significantly higher levels of conflict in their organizations. In handling conflict, the prospector firms perceived a higher level of integrative behavior than the defender firms. The defenders perceived higher levels of forcing and avoiding conflict behaviors. The study identifies a strong, positive relationship between integrative behaviors and constructive conflict. Positive relationships are also identified between constructive conflict and the success of cross‐functional relationships, as well as between constructive conflict and NPD business success.

For the firms in this study, the results indicate that strategy is associated with the conflict‐handling mechanisms the firm uses. For example, the results suggest that an NPD manager in a prospector firm will encounter high use of integrative behaviors, a high number of complex conflicts, a relatively low level of perceived conflict, a high level of formalization, and frequent exchanges of written and verbal communication among the firm's personnel. The results suggest that managers may help to create an environment conducive to NPD success by assessing their firms' strategies, emphasizing integrative conflict‐handling behaviors, and employing formalization of organizational procedures.
Accelerating the Process of Engineering Change Orders: Capacity and Congestion Effects
Authors: Loch Christoph H. , Terwiesch Christian
Published: October 2003

Engineering change orders (ECOs) are important drivers of development costs and lead time. This article analyzes the process of administering engineering change orders in the case of the climate control system development within a large vehicle development project. This administrative process encompasses the emergence of a change (e.g., a problem or a market‐driven feature change), its management approval, and final implementation. Despite strong time pressure, this process can take several weeks, several months, and, in extreme cases, even over 1 year. Such a long lead time is especially remarkable as the actual processing time for the change typically does not exceed 2 weeks. Based on our case study, we develop an analytical framework that explains how such an extreme ratio between theoretical processing time and actual lead time is possible. The framework identifies congestion, stemming from scarce capacity coupled with processing variability, as a major lead time contributor. We outline five improvement strategies that an organization can use in order to reduce ECO lead time, namely, flexible capacity, balanced workloads, merged tasks, pooling, and reduced setups and batching. © 1999 Elsevier Science Inc.
Managing the Process of Engineering Change Orders: The Case of the Climate Control System in Automobile Development
Authors: Terwiesch Christian , Loch Christoph H.
Published: October 2003

Engineering change orders (ECOs) are part of almost every development process, consuming a significant part of engineering capacity and contributing heavily to development and tool costs. Many companies use a support process to administer ECOs, which fundamentally determines ECO costs. This administrative process encompasses the emergence of a change (e.g., a problem or a market‐driven feature change), the management approval of the change, up to the change's final implementation. Despite the tremendous time pressure in development projects in general and in the ECO process in particular, this process can consume several weeks, several months, and in extreme cases even over 1 year. Based on an in‐depth case study of the climate control system development in a vehicle, we identify five key contributors to long ECO lead times: a complex approval process, snowballing changes, scarce capacity and congestion, setups and batching, and organizational issues. Based on the case observations, we outline a number of improvement strategies an organization can follow to reduce its ECO lead times. © 1999 Elsevier Science Inc.
A Laddering Approach to the Use of Methods and Techniques to Reduce the Cycle Time of New‐to‐the‐Firm Products
Authors: Langerak Fred , Peelen Ed , Nijssen Ed
Published: October 2003

Millson, Raj, and Wilemon have developed the earliest extant knowledge on the implementation of methods and techniques to reduce new product development (NPD) cycle time by suggesting a hierarchy of generic NPD acceleration approaches. The purpose of this article is to extend Millson, Raj, and Wilemon's hierarchy by recasting and augmenting the conceptual basis of their hierarchy for new‐to‐the‐firm products. Taking this hierarchy of generic NPD acceleration approaches as a starting point, the authors set out to form a number of generic NPD acceleration approaches by surveying the literature and conducting an experience survey with academics and managers. A logical and purposeful implementation sequence subsequently is established by using the laddering technique. The results indicate that managers make tradeoffs in NPD with regard to speed, development costs, and customer value, and that not all generic NPD acceleration approaches need to be implemented in order to obtain the greatest effectiveness. © 1999 Elsevier Science Inc.
From Experience: Reaping Benefit from Speed to Market
Authors: Smith Preston G.
Published: October 2003

Many companies have gained great benefit from a speed‐to‐market program. Others have tried but failed to achieve measurable, sustained value. Still others have not even tried, being concerned about adverse consequences.

This article helps newcomers decide how to approach time to market. It first addresses some common fears about development acceleration, such as increased project expense and lapses in quality. An effective program overcomes these concerns, but it must do much more. It must stem from a statement, clear to all developers, explaining how faster development is tied directly to improved competitiveness and thus to higher profits for the company. A general corporate goal of a 50% across‐the‐board cut in cycle time will not do, nor will an underlying hope that faster development will improve developer productivity.

To help establish a clear link from speed‐to‐market to profitability, I suggest calculating how much a week of delay impacts profit, and I show how to align a development acceleration program with corporate programs to improve quality or productivity.
Life‐Cycle Management of Supplier Literature: The Pertinent Issues
Authors: Boston Oliver P. , Culley Stephen J. , McMahon Christopher A.
Published: October 2003

In order to support the design and development of new products that are of enhanced quality, reliability, and performance, the need for design information to be accurate, current, and accessible should be a major influence and priority for individuals and organizations alike. This article identifies standard supplier literature as a key source of design information; it is widely used and heavily relied upon within the early phases of new product development where the cost and quality of an artifact are largely defined. Subsequently, it presents and discusses the results of an extensive investigation into the way this information source was organized and handled within a typical engineering organization. In general, this revealed that an array of deficient “systems” were used for classifying it, and there were no formal procedures in place for its life‐cycle management, with corresponding consequences for the effectiveness of the design operation.
Effects of Organizational and Decision‐Maker Factors on New Product Risk Taking
Authors: Mullins John W. , Forlani David , Walker Orville C.
Published: October 2003

Using samples of evening MBA students having considerable managerial experience, two experiments were conducted, through which we explore the effects of organizational and decision‐maker factors on managers' new product investment decisions. Subjects were asked to choose among new product development projects having equal investments and expected values but differing degrees of risk. Riskier projects were chosen by managers whose organizationally imposed goals were based on aspirational versus survival reference points, whose prior project decisions had resulted in the accumulation of additional financial resources, for whom prior project outcomes were attributed to the manager's guidance of the project versus competitive factors, and by managers whose propensities to take risks were higher. These results have important implications for the design and staffing of new product decision processes, for the creation of organizational cultures that foster new product risk taking, and for other organizational practices.
Product Innovativeness and Entry Strategy: Impact on Cycle Time and Break‐even Time
Authors: Ali Abdul , Krapfel Robert , LaBahn Douglas
Published: October 2003

New product development time, or cycle time, has become a critical competitive variable, particularly for small high‐tech manufacturing firms. The business press is filled with examples about large firms that have successfully reduced cycle time. This article investigates the relative impact of product innovation and entry strategy on cycle time and initial market performance of small firms. Using a sample of seventy‐three small manufacturing firms, Abdul Ali, Robert Krapfel, Jr., and Douglas LaBahn find that faster product development is associated with shorter break‐even time. Their results also indicate that these firms are achieving shorter cycle time not by sacrificing product quality, but by keeping the technical content of the product simple. Past research has not taken into account this relationship, and this may be one of the reasons why researchers have often suggested conflicting impact of entry strategy on market performance.
Significant Issues for the Future of Product Innovation
Authors: Devinney Timothy M.
Published: October 2003

In recognition of JPIM's second decade of publication, the Editor‐in‐Chief solicited a series of thoughtful contributions from members of the Editorial Board. Members were asked to reflect upon changes and opportunities that they see influencing our profession during the coming years. In this issue, Timothy Devinney asks why globalization has so far had so little impact on many companies' approaches to the management of product innovation. He wonders if innovation is an inherently local activity, or whether other explanations are at work. Among them, he singles out the way firms acquire and process information as an important influence on innovation practices. Too often, we examine markets on a national rather than on a cultural basis, and this limits and even distorts our ability to formulate appropriate strategies and to detect opportunities. Like earlier contributions, this short essay is designed to introduce new perspectives. It is not essential that you agree with the recommendations, but we hope that you are stimulated as you reflect on the included issues.
Multicollinearity and Reduced‐Form Price Equations For Residential Markets: An Evaluation of Alternative Estimation Methods*
Authors: Gau George W. , Kohlhepp Daniel B.
Published: October 2003

One of the problems that has plagued researchers in their estimation of reduced‐form price equations for specific housing markets has been multicollinearity—the lack of statistical independence of the explanatory variables. This paper evaluates the suitability for structural analysis and prediction of stepwise regression and principal components regression as alternatives to the standard regression model in the estimation of equations with interdependent data. In general, the results of this study indicate that under conditions of multicollinearity principal components regression is the superior estimation technique.