An Empirical Evaluation of R&D–Marketing NPD Integration in Chinese Firms: The Guanxi Effect
Authors: Perks Helen , Kahn Kenneth , Zhang Cong 
Published: August 2009

Research examining new product development (NPD) practices recognizes the importance of research and development (R&D)–marketing integration to performance. Although a plethora of work has been carried out in the R&D–marketing domain, including Chinese firms, the study of cross‐country contexts has relied on country type as the demarcation to explain country differences. No specific cultural elements inherent in the respective countries have been examined. In the case of China, this study introduces the cultural more of guanxi. Seen as an alternative to formal institutionalized interactions, guanxi characterizes the bond between people in Chinese society. To date, the construct of guanxi has received scant attention in NPD literature. The present study examines whether guanxi affects the nature of R&D–marketing integration in Chinese firms. This work is carried out to infer whether specific cultural mores play a role in influencing R&D–marketing integration versus just recognizing a country context. A quantitative survey‐based method was adopted to address the research objectives. The sample comprised Chinese high‐technology (specifically information technology [IT]) organizations, which were managed by Chinese nationals with headquarters physically located in China. Many Chinese‐based IT companies have indigenous R&D departments and are embarking on radical and incremental new‐to‐the‐market product development. Pretest qualitative data were collected through telephone and respondent interviews. The final questionnaire was sent to target senior managers, resulting in a sample comprising 100 marketing and 100 R&D personnel. Study measures were developed, and factor analysis was applied to the NPD integration items. Correlation and logistic regression analyses were employed. The findings identify particular aspects of integration practices between Chinese R&D and marketing managers that differ from the West in light of the significant effect reflected by the guanxi construct. The results show that reliance on informal social systems, through guanxi, can act as a significant support for integration in certain activity areas and that guanxi can influence integration in mid‐ to late‐phase activities. This study's findings suggest that guanxi can act as a unifying force in underdeveloped processes (e.g., NPD) and may, paradoxically, reinforce acceptance of formalized structures. It appears that guanxi is highly utilized to make up for the deficiencies of formal external institutional structures (e.g., regulatory and legal specifications). These findings suggest that where the basis for guanxi exists, traditional and culturally derived interpersonal relationships still impact the way people work together. The results of this research provide new knowledge of how guanxi positively influences the integration of R&D and marketing departments as well as successful NPD performance. Guanxi may underlie how R&D–marketing integration is facilitated in China. The study's findings provide a finer understanding of why Chinese firms may reflect different R&D–marketing integration practices. Managerial and research implications are presented in the paper.