A Survey of Major Approaches for Accelerating New Product Development

Product life-cycles are becoming shorter, leading firms to reduce the time to bring new products to market. Being early can provide a significant competitive advantage, making the acceleration of new product development (NPD) an important area for research and inquiry. Based on their review of a wide range of literatures in business strategy, marketing, new product development, manufacturing and organization management, Murray Millson, S. P. Raj and David Wilemon report a general set of techniques for reducing the developmental cycle time for new products. The article develops a hierarchy of available NPD acceleration approaches and discusses potential benefits, limitations and significant challenges to successful implementation.     

Accelerating New Product Development: A Preliminary Empirical Test of a Hierarchy of Implementation

Although time to market and a product's profitability are closely linked, simply speeding up new product development (NPD) is no guarantee of success. In fact, haphazardly adopting the numerous methods for accelerating NPD may jeopardize the potential success of the new product and the company. An article in a previous issue of The Journal of Product Innovation Management suggests that companies seeking to speed up their NPD process should take a hierarchical approach to implementing the various acceleration techniques. To improve the likelihood that efforts to accelerate NPD will pay off with shorter development time, greater market share, and improved profitability, it is recommended that a company start by focusing on simplification of the NPD process. From there, the company can proceed in sequence through techniques involving the elimination of unnecessary steps in the NPD process, parallel processing (i.e., performing two or more NPD steps at the same time), the elimination of delays, and speeding up of the NPD process. Ed J. Nijssen, Arthur R. L. Arbouw, and Harry R. Commandeur follow up on this earlier work by addressing several key questions regarding the proposed hierarchy of techniques for accelerating NPD. First, do companies that make extensive use of the proposed hierarchy develop new products faster than companies that do not? Second, do companies that make extensive use of the hierarchy enjoy better financial performance than those that do not? Third, regardless of the hierarchy, are products developed faster by companies that make more intensive use of acceleration methods than by companies that use fewer methods of acceleration? Finally, how does financial performance compare among companies that make more intensive use of acceleration methods without following the hierarchy and those that use fewer methods of acceleration? A survey of Dutch companies finds that the proposed hierarchy of techniques has a positive effect on NPD speed. The survey results also suggest that faster NPD is possible through the use of the various acceleration methods without regard for the order in which they are implemented. However, a strong positive relationship is evident between the hierarchy and the profitability of the product and the company. In other words, a random approach to NPD acceleration does not improve financial performance. By trying to accelerate NPD in accordance with the proposed hierarchy of methods, a company can avoid critical mistakes that might otherwise limit financial results.     

Stage‐to‐Stage Information Dependency in the NPD Process: Effective Learning or a Potential Entrapment of NPD Gates?

The new product development (NPD) process is a sequence of stages and gates. Each stage consists of NPD activities that provide NPD managers with information input about the new product project progression. Information input is used for review decisions at gates. Over the course of an NPD process, managers learn about a new product project as to ensure successful launch. The view is that a new product project is shaped by the path of NPD activities it has traveled. Because learning is assumed to take place over the course of the NPD process, stage‐to‐stage information dependency is an assumption of NPD research. A concern raised is that development activities for each NPD stage are rigorously followed by NPD managers. In other words, stage‐to‐stage information dependency may potentially trap NPD managers rather than create effective learning from end to end of the development process. The purpose of this paper is to explore the assumption of stage‐to‐stage information dependency in NPD. The investigated research questions are whether the selection of NPD activities is linked between stages and whether these information dependencies strengthen NPD gate decisions. For the information dependencies identified in the study, the innovation experience characteristics of NPD managers pursuing them and the influence of information dependencies on NPD gate decisions are analyzed so as to provide insights for a discussion of information dependency versus information independency in the NPD process. The applied research method is an experiential simulation of NPD gate decision‐making—NPDGATES. One hundred thirty‐one NPD managers from international product development strategic business units (SBUs) situated in Denmark participated in the study. Logistic regressions were conducted as the basis for the calculation of stage‐to‐stage information dependency probabilities. Based on the study findings, the assumption about information dependency in the NPD process held by NPD research is found to be flawed. End‐to‐end information paths in the NPD process are rare. Further, market condition changes are found to significantly influence the stage‐to‐stage information dependencies demonstrated by NPD managers. It seems that competition becomes a reassurance of NPD efforts. Also, the results show that NPD experience creates inflexibility in relation to the selection of NPD activities. The need for strict process management is strong among experienced NPD managers. In relation to NPD gates, the results show that information dependencies increase priority given to financial decision criteria at gates and lower priority given to customer and market decision criteria. Overall, stage‐to‐stage information dependency seems to create inflexibility that hinders successful NPD process implementation.     

Marketing–Industrial Design Integration in New Product Development: The Case of China*

Despite the acknowledgement of functional integration as an important driver of new product development (NPD) success and the growing recognition of the significance of industrial design (ID), the integration between industrial design and other functional units in NPD has been rarely researched. In this article, we examine the marketing and ID integration in NPD in the context of China. Mainly based on Cooper's (1994) stage‐gate phases of NPD process and Gupta, Raj, and Wilemon's (1985) categorization of NPD activities, we develop a conceptual framework that identifies 29 areas that might require integration or where integration might occur between marketing and ID. Specifically, we investigate and compare the current and the ideal integration between marketing and ID perceived by the two functions. An analysis of data from 113 companies reveals that the current level of integration fell short of the ideal level of integration in all the phases of NPD. Both managers believed in the descending trend of integration along the stage‐gate NPD phases and were dissatisfied with the current level of integration in all the NPD phases. Except for a few areas of agreement, marketing and ID managers showed significant differences with each other in their perceptions of the current and the ideal integration in most of the 29 areas. Despite the disagreements however, the two functions agreed with each other on the most important areas that require integration and achieved the highest level of marketing–ID integration. These findings suggest that firms should improve the marketing–ID integration in all the NPD phases and that management could improve the effectiveness of marketing–ID integration by prioritizing and focusing on the most important areas. Research and managerial implications, limitations, and future research directions are presented in the paper.     

Psychosocial antecedents of communication,trust, and relationship effectiveness in new product development projects: a functional manager perspective

The basic differences between marketing managers and their technically trained counterpart managers [e.g., research and development (R&D), engineering, and manufacturing managers] in terms of work experience, training, and differing decision‐making styles have often been suggested as a source of conflict, which acts as a barrier to effective working relationships and integration during new product development (NPD) work. In this paper, we empirically explore this issue by developing and testing a model of psychosocial differences (thought worlds and psychological distance) between the two groups of managers and their effect on communication, trust, and relationship effectiveness during NPD projects. We find that while thought world differences do still matter, it was from a marketing perspective that they had a stronger effect. These findings have implications for top management trying to manage the functional manager interface during NPD projects. We propose a semi‐formalized approach to relationship building that may speed up the acquisition of social data that is often necessary to elevate working relationships to trusting ones and improve the efficiency of NPD work. Our model is tested using data from two samples, 184 technically trained managers and 145 marketing managers from Australian companies involved in NPD work.     

Perceptions of Industrial Design: The “Means” and the “Ends”

It is widely accepted that industrial design can play an important role in the development of innovative products, but integrating design‐thinking into new product development (NPD) is a challenge. This is because industrial designers have very different perspectives and goals than the other members of the NPD team, and this can lead to tensions. It has been postulated that the communications between NPD managers and industrial designers are made more difficult because each group uses very different language. This research made the first empirical investigation of the language used by designers and managers in describing “good” and “poor” industrial design. In‐depth interviews were conducted with a sample of 19 managers and industrial designers at five leading companies. Multiple sources of data were utilized, including the repertory grid technique to elicit the key attributes of design, from the perspective of managers and designers. Using a robust, systematic coding approach to maximize the validity and reliability of qualitative data analysis, it was established that managers and industrial designers do not use a completely different vocabulary as previously supposed. Rather, it was found that managers and industrial designers use some common terms augmented by additional terms that are specific to each group: managers are commercially orientated in the “ends” they want to achieve and designers perceive more antecedents (“means”) necessary to achieve their “ends”—iconic design. This research led to a grounded conceptual model of the role of design, as perceived by managers and industrial designers. The implications of the results achieved are wide: they indicate how managers and designers can interact more productively during NPD; they highlight the need for more research on the language of designers and managers; and they point to issues that need to be covered in the education of industrial designers. Finally, this work suggests how managers and designers can engage in a more fruitful dialogue that will help to make NPD more productive.     

Involving purchasing in new product development

Purchasing is evolving into a strategic business activity and thus also a potential contributor to the successful development of new products. However, the literature on the involvement of purchasing in new product development (NPD) is sorely lacking. We conducted an exploratory study to investigate purchasing's involvement in NPD, the drivers of this involvement and the influence on new product success. We conducted telephone interviews with purchasing and NPD managers from 43 firms. The results show that firms differ in the extent to which they involve purchasing in NPD and that higher involvement has a positive effect on NPD performance. R&D managers can use the results to design a more effective purchasing–R&D interface and increase the success of NPD.     

Cooperation and the Ability to Minimize the Time and Cost of New Product Development within the Spanish Automotive Supplier Industry

New product development (NPD) cycle time has become a strategic competitive weapon for corporations and a focus for research on product development management. Reducing NPD cycle time may create relative advantages in market share, profit, and long‐term competitiveness. This article follows recent research that already has moved beyond anecdotes and case studies to test factors empirically and variables that are associated with the company's NPD time and cost minimization abilities. One emerging research area is the impact of comprehensive lists or sets of firm variables (not project variables) on the ability to speed up NPD. At the same time, several authors' findings suggest a contingency approach to speeding up innovation. Contingency theory argues that there is not one “best answer” to a particular problem: Instead, the appropriateness of managerial interventions is dependent on the prevailing conditions that surround that problem. On the issue of NPD, several scholars point out that cooperation accelerates learning and product development: Firms that combine resources can gain a competitive advantage over firms that are unable to do so, and this is viewed as one of the key benefits of interfirm cooperation. A firm's network of cooperations represent a valuable resource that can yield differential returns in the same way as other tangible and intangible assets such as product brands or R&D capabilities. Combining both lines of research, this study seeks to add to the growing literature and further to inform practicing managers in speeding up NPD by analyzing the relationship between cooperation and the use of some NPD firm practices. This article shows the results of a survey of 63 Spanish automotive suppliers to test the moderation effect of cooperation in the relationship between the use of NPD firm practices and the company's NPD time and cost minimization abilities. Factor and regression analyses were used to test the article's hypotheses. It was found that high‐cooperation companies used more intensively sets of firm practices than low‐cooperation companies. It also was found that two out of four identified factors of NPD firm practices—Design‐Manufacturing Interface and Cross‐Functional Design—were related positively to the company's NPD time and cost minimization abilities in the subsample of high‐cooperation companies but not in the low‐cooperation companies. These results support late research in the area of speeding up NPD. The article discusses some implications for managers.     

Managing Seller–Buyer Relationships during New Product Development*

Ineffective relationship management with potential buyers during new product development (NPD) can be an important contributor to new product failure in technology‐based, industrial markets. However, empirical research on managing these relationships remains underdeveloped. This study addresses this deficiency by developing an empirically based taxonomy of relationship approaches used by sellers to develop technology‐based, industrial innovations, identifying situational characteristics that correlate with the choice of a particular relationship approach, and evaluating sellers' satisfaction with their relationship approach. The study's conceptual model is rooted in transaction cost analysis (TCA) and draws from extant literature on seller–buyer relationships during NPD. It was tested with data from 334 small to mid‐sized firms in a variety of technology‐based industrial markets. The results indicate that sellers use three basic relationship approaches during NPD: a bilateral approach, a buyer‐guided approach, and a seller‐guided approach. While the bilateral approach relies on a mutual exchange of information, the buyer‐guided and seller‐guided approaches do not. Juxtaposed with the high levels of satisfaction experienced by sellers in the sample, the study suggests that no one relationship approach is universally desirable. Therefore, managers may need to engage in a portfolio of relationship approaches with buyers during NPD; further, these approaches should correlate with buyer‐related (i.e., perceived buyer knowledge and prior relationship history) and innovation‐related (i.e., product customization and technological uncertainty) characteristics. Collectively, these results can help sellers optimize their relationships with buyers during NPD.     

Development of a Design Audit Tool for SMEs*

There is strong evidence of the importance of good design to company success. However, it is apparent that despite this evidence, design skills are often marginalized in small and medium‐size enterprises (SMEs). This article presents a design audit tool that captures good design principles in a form accessible to industry. Previous audit approaches have focused extensively on the management of new product development (NPD). In this research, the audit tool is based on process maturity principles and explicitly targets the design related activities in NPD—specifically in small firms. The design audit has been developed iteratively by application in action research mode and is supported by evidence from literature and exploratory cases. This inductive development enabled the generation of a robust audit tool through intervention in small firms to improve design practices. The resulting audit tool is designed for use in a multifunctional workshop setting. Typical outputs from application include the generation of action plans for improvement in future performance. This audit tool is based around a model of good design that explicitly distinguishes between management and design related activities in NPD. The audit tool has succeeded in encouraging managers to pay greater attention to the design related elements of NPD. This complements the satisfaction of managerial goals typically emphasized in many NPD processes.     

Navigating the purchasing power gap in new product development in multinational corporations

Multinational corporations (MNCs) face a significant purchasing power gap of customers between developed and emerging economies. In R&D intensive industries making physical products, MNCs can benefit from economies of scale. Therefore, managers strive to achieve a product standardization–adaptation (S‐A) balance when navigating the purchasing power gap. Through focusing on five MNCs headquartered in developed countries, I examined how MNCs can achieve such a balance through new product development (NPD). I found that (1) an S‐A balance can be achieved through three NPD strategies (product simplification, product retaining, and reverse innovation); (2) managers need to take into account five key factors when choosing NPD strategies (product complexity, product modularity, brand strategy, position in local competition, and internal technical standards); and (3) the NPD strategies can be implemented through structural separation, temporal separation, and a shared value. This research reveals the complexity of achieving an S‐A balance when managers navigate the purchasing power gap in NPD. Different NPD strategies have certain advantages and shortcomings. High product complexity and product modularity can serve as favorable conditions for a product simplification strategy. A brand strategy of leading‐edge technologies can serve as an adverse condition for a product retaining strategy. Strong local competitors in emerging markets can be a motivation for a reverse innovation strategy, while stringent internal standards for safety can be an adverse condition. This research also reveals the nuances of implementation of NPD strategies in terms of managing innovation and refinement activities. MNCs may need temporal separation when adopting both downhill and uphill NPD strategies.     

The Roles of Sustainability Orientation and Market Knowledge Competence in New Product Development Success

Firms’ sustainability orientation (SO) is widely understood as a strategic resource, which can lead to competitive advantage and superior (financial) performance. While recent empirical evidence suggests a moderate and positive relationship between SO and financial performance on a corporate level, little is understood about the influence of SO on new product development (NPD) success. Building on the natural‐resource‐based view (NRBV) of the firm, we hypothesize that firms’ SO positively influences NPD success, because of efficiency gains and differentiation advantages. However, scholars have also argued that the win–win paradigm postulated by NRBV might not always hold because NPD managers might find it difficult to balance sustainability objectives with the needs of their customer and the competitive dynamics in their markets. It is, therefore, proposed that market knowledge competence (MKC) is an important capability, which helps firms to balance social and ecological objectives with economic goals such as profitability and market share. Using data from 343 international firms from 24 countries that was collected by the Product Development and Management Association, structural equation modeling results suggest that (1) SO positively influences NPD and that (2) this relationship is partially mediated by firms’ market knowledge capabilities. The findings suggest that strategic‐level SO and MKC are complementary in that they help in balancing trade‐offs between sustainaility objectives and profitability goals. In this way, the study contributes to a better understanding of how critical NPD practices can help managers to translate firms’ SO into NPD success. The article concludes by highlighting implications for product innovation managers.     

Development Resource Planning: Complexity of Product Development and the Capacity to Launch New Products

Overcommitment of development capacity or development resource deficiencies are important problems in new product development (NPD). Existing approaches to development resource planning have largely neglected the issue of resource magnitude required for NPD. This research aims to fill the void by developing a simple higher‐level aggregate model based on an intuitive idea: The number of new product families that a firm can effectively undertake is bound by the complexity of its products or systems and the total amount of resources allocated to NPD. This study examines three manufacturing companies to verify the proposed model. The empirical results confirm the study's initial hypothesis: The more complex the product family, the smaller the number of product families that are launched per unit of revenue. Several suggestions and implications for managing NPD resources are discussed, such as how this study's model can establish an upper limit for the capacity to develop and launch new product families.     

Navigating the new product development process

The quest for success in new product development (NPD) requires management to navigate complex processes. This study presents empirical evidence of the evaluative criteria used by well-experienced NPD managers from the UK and the Netherlands to control performance at different gates of the NPD process. The emerging usage patterns suggest that these criteria are aligned to the specific requirements of each stage in the process. This allows for detection of problems and initiation of adjustments that increase the chance for overall success of the new product. Based on these findings, recommendations are provided for managers to safeguard strategically the performance of their NPD efforts.     

The Role of Departmental Thought Worlds in Shaping Escalation of Commitment in New Product Development Projects

The debate over whether and how thought worlds of different departments (especially marketing and research and development [R&D]) affect managers' decision-making behavior in new product development (NPD) is ongoing. A key challenge of these decisions is to deal with deteriorating NPD projects, which are often subject to escalation of commitment (EoC), with many firms wasting billions of dollars by throwing good money after bad NPD projects. However, understanding departmental thought worlds and their role for EoC in NPD could help firms stop this profusion. Thus, this research provides answers to the question of how thought worlds affect managers' tendency toward EoC in NPD decision-making—both in general and under certain project characteristics. To do so, we conducted four studies based on real-life scenarios with 460 highly experienced NPD managers from marketing and R&D, thus ensuring high validity and reliability. Our research is the first to explore the impact of thought worlds on EoC, thereby detecting that the importance of managers' thought worlds for shaping EoC varies with the NPD project's characteristics. Thus, depending on the specific project situation, different types of managers may be more or less capable of making proper NPD decisions. Moreover, results show that belief updating serves as a respective key mediator. Doing so enriches the theory by showing that managers' thought worlds can substantially influence a major mechanism (i.e., belief updating) of coping with cognitive dissonance. Finally, post hoc tests reveal departmental differences in EoC behavior between marketing and R&D that vary with a project's characteristics. These results imply that firms need to carefully consider who is in charge of making decisions on NPD project continuance in different project situations.     

Strategic orientation and new product development performance: The role of networking capability and networking ability

While strategic orientation can represent an important antecedent to new product development (NPD) performance, research suggests that adopting a strategic orientation alone is not sufficient and a better understanding of contingencies is necessary. Based on the dynamic capability view of the firm, this study examines the effect of a firm's ability to connect with external network partners (networking capability) and the ability of NPD project managers to network with stakeholders within the firm (networking ability). The empirical results indicate that market orientation and entrepreneurial orientation are positively associated with NPD performance when a firm has sufficient networking capability to manage network dynamics and when the managers of NPD projects possess networking ability to successfully mobilize the support and advocacy of stakeholders within the firm. The results also show that NPD performance is highest when market (entrepreneurial) orientation, networking capability, and networking ability are all high, thus supporting the proposed three-way interaction.     

Exploring the Nonlinear Impact of Organizational Integration on New Product Market Success

This article explores the nonlinear relationship between organizational integration and new product market success (NPMS). The concept of organizational integration was measured by assessing the degree of integration among various groups of people involved in the development of new products including new product development (NPD) teams that are typically the focal points of NPD efforts. New product market success was measured by examining four often‐used measures of NPD success. The mail survey research approach was used to gather empirical data from NPD managers in three major industries. The data gathered from this survey process were used as the basis from which to extract information to address this study's major research questions, which include: (1) How is the degree of new product market success related to the nonlinear degree to which groups of people (including NPD teams) integrate during NPD processes? and (2) How is the degree of new product market success related to the nonlinear degree to which separate groups of people (e.g., customers, suppliers, and functional departments) integrate during NPD processes? This study found that high levels of organizational integration (overall organizational integration and supplier organizational integration) during NPD processes are associated with high levels of new product market success. Additionally, this study found that the relationship between new product market success and organizational integration (customer organizational integration and functional organization integration) during NPD processes exhibit nonlinear, U‐shaped relationships. Therefore, the first important finding of this study confirms that various forms of organizational integration impact in a positive way the market success of new products. This suggests that management responsible for all NPD projects should consciously integrate important groups of people to support such developments. This study's findings also confirm and imply that new product developers in the studied industries should integrate marketing and research and development (R&D) over the duration of the NPD process. This suggests that new product managers must be proactive to assure that members of NPD teams are actively engaged with groups of supporting people within and outside new‐product–producing organizations. Unlike prior research, a major finding of this study suggests that the association between organizational integration and new product market success does not form inverted U‐shaped relationships. Data from this research imply that new product market success is linearly influenced by overall and supplier organizational integration. However, this study's data suggest that new product market success is nonlinearly influenced by customer and functional organizational integration. This study's data suggest that when customer organizational integration and/or functional organizational integration is increased, new product market success can be increased at a rate which is greater than a linear rate.     

Coordination of Design Supply Chains for Bundling Physical and Software Products*

Research on product development management has concentrated on physical products or on software, but not both. This article explores a special new product development (NPD) approach in which the internal development of core physical products is augmented by bundled and largely outsourced software features. We studied a medical device producer that has established a new medical information product group (MIPG) within their NPD organization to create software features that are bundled with their core physical products. The MIPG has conceptualized these software features as multiple software development projects, and then coordinated their realization largely through the use of external software suppliers. This case study centers on the question: how can firms effectively coordinate such product development processes? Our analysis of case evidence and related literature suggests that such product bundling processes, when pursued through design supply chains (DSC), are more complex than is typical for the development of streams of either physical products or software products individually. We observe that DSC coordination transcends the requirements associated with traditional “stage‐gate” NPD processes used for physical product development. Managers in DSC settings face a tension inherent to distributed work: keeping internal and external development efforts separate to exploit the design capabilities within a network of software suppliers, while ensuring effective delivery of a stream of bundled products. Many managers face this coordination tension with little, if any, prior knowledge of how to create a streamlined and effective DSC. Our research indicates that these managers need to make a series of interrelated decisions: the number of suppliers to qualify and include in or exclude from the DSC; the basis for measuring and modifying the scope of the suppliers' work; the need to account for asymmetric cost structures and expertise across the DSC; the mechanisms for synchronizing development work across elements of the DSC; and the approaches for developing skills—both technical and administrative—that project managers need for utilizing in‐house competencies while acquiring and assimilating design know‐how from external development organizations. When managers take a flexible approach toward these decisions based on a modular set of software development projects, they can improve their NPD outcomes through technical and organizational experimentation and adjust their own resource deployment to best utilize the suppliers' capabilities within their DSC.     

Drivers and Pathways of NPD Success in the Marketing–External Design Relationship

Marketing often cooperates with external design in the new product development (NPD) process. While this relationship is crucial for NPD success and is a typical case of interorganizational collaboration between a business‐oriented function (marketing) and a creative partner (external design), a comprehensive understanding of this relationship remains lacking. As the NPD field evolves to open systems that have changed concepts like functional integration into interorganizational integration, this study contributes to NPD literature by developing an integrated conceptual framework leading to a model of drivers and pathways of NPD success in the marketing–external design relationship. Building on the literature on NPD, design management and relationship marketing, and on nine dyadic case studies from the luxury fragrance and cosmetics industry, a content analysis was conducted, enriched by a crisp‐set qualitative comparative analysis (QCA). This research confirms several NPD success drivers suggested in the literature and reveals three new drivers: source of design expertise, designer brand commitment, and number of NPD stages involving designer. The first new driver (source of design expertise) impacts the relationship process, which then impacts NPD success, while the other two drivers (designer brand commitment, and number of NPD stages involving designer) directly influence NPD success. The paper also identifies the pathways of NPD success, showing that contact authority and designer brand commitment are necessary conditions for NPD success, especially when combined with a high number of NPD stages involving designer or a previous relationship. The results also indicate that pathways of NPD success may differ according to the source of design expertise. From a managerial perspective, this study provides recommendations to managers to select the right design partner and choose from a range of drivers and pathways to devise more effective ways to work with external designers, thereby leading to NPD success.