How Knowledge Management Capabilities Help Leverage Knowledge Resources and Strategic Orientation for New Product Advantages in B-to-B High-Technology Firms

ABSTRACT

Purpose: Current understanding of how new product development (NPD) teams use knowledge management capabilities to acquire, disseminate, and apply knowledge resources to achieve competitive advantages is limited by a lack of compelling theory supported by empirical evidence. This study provides a theoretical framework and empirical validation for how an NPD team manages knowledge resources and strategic orientation to enhance its knowledge management capabilities, which, in turn, lead to business-to-busienss (B-to-B) new product advantages.

Methodology/approach: A total of 100 sets of data was collected from B-to-B firms in U.S. high-tech industries. In order to validate the proposed hypotheses, we estimated the main effects using path analysis in AMOS, and tested for interaction effects using interaction term regressions.

Findings: Our findings show that the two dimensions of NPD knowledge management capabilities—acquisition and application—are important but differential drivers of product quality superiority and product differentiation. In testing whether NPD management capabilities matter for two product advantage constructs, we confirmed that product quality superiority can be enhanced by both NPD knowledge acquisition and application capabilities, whereas product differentiation can be increased strongly by NPD knowledge acquisition capabilities.

Research implications: Our research confirms the importance of strategic orientation as a driver of NPD knowledge management capabilities, which enhances understanding of how strategic factors operate under a resource-based view. Our results further provide direct empirical support for the knowledge-based view of firms, in that an NPD team’s abilities to manage and deploy knowledge-based resources by acquiring and applying NPD knowledge lead to competitive advantages, for outcomes of quality superiority and differentiation.

Practical implications: Our findings have relevance for managers in three ways. First, NPD knowledge acquisition and application capabilities have differential impacts on product quality superiority and differentiation. Second, in exploring NPD resource factors as antecedents, managers should manage levels of NPD market intelligence, resource tacitness, and NPD resource deployment differentially to directly improve NPD teams’ acquisition and application capabilities. Third, managers should not underestimate the importance of market and technological orientations in enhancing NPD knowledge management capabilities. Market orientation drives both NPD knowledge acquisition and application capabilities; technological orientation drives NPD knowledge application capabilities. Originality/value/contribution of the paper: An NPD team’s knowledge management capabilities generally, but differentially, mediate the relationships of knowledge resources and strategic orientation factors with new product competitive advantage. However, simply enhancing NPD knowledge management capabilities is not a panacea for developing product competitive advantage in B-to-B settings, because of their differential effects.     

Alliance-Based New Product Development Success: The Role of Formalization in Exploration and Exploitation Contexts

Purpose: Although alliances offer tremendous strategic potential, firms still struggle to successfully manage new product development alliances (NPD alliances). A prominent explanation for this is the institutional economics' view (see Williamson 1985 Williamson, O. E. 1985. The economic institutions of capitalism: Firms, markets, relational contracting, New York: The Free Press.  [Google Scholar]) that, in general, a key disadvantage of alliances versus vertical integration is that administrative control mechanisms are weaker. Here, a key control mechanism is formalization (the use of explicit rules to govern business activities).

However, regarding formalization's influence on both NPD and alliance performance, conceptual views and empirical findings are mixed, which suggest that unexamined variables moderate formalization's influence on NPD performance.

Therefore, it is surprising that there is no research on whether formalization's influence differs in alliances pursuing an NPD exploration strategy versus an NPD exploitation strategy because both (1) require varying levels of freedom of action and adherence to procedural rules to achieve success, and (2) are extensively employed in NPD.

Further, there is also surprisingly little intrafirm NPD and non-NPD alliance research on formalization in exploration and exploitation contexts because here as well formalization's influence on performance (1) is central, and (2) differs based on the project's innovative and learning intent.

The purpose of this research is to begin to close important literature and industry practice knowledge gaps about formalization's influence on NPD alliance performance in exploitation versus exploration strategic contexts.

Originality, value, and contribution: This research is the first examination ever of two key NPD strategies—exploration and exploitation—in an NPD alliance context. The research sheds light on conflicting views about formalization's NPD performance-enhancing and inhibiting aspects, and offers implications for industry best practices.

Methodology/approach: Empirical examination of survey data from 151 NPD alliances via hierarchical regression and tests of group moderation.

Findings: Results shed light on when and why formalization moderates the influence of key fundamental alliance success mechanisms on NPD alliance performance based on strategic context.     

Exploring the need for (extreme) speed: motivations for and outcomes of discontinuous NPD acceleration

ABSTRACT

New product development (NPD) speed is an important concern for firms in today’s fast-paced economy. While existing literature has focused on continuous NPD speed improvements, this paper explores discontinuous NPD acceleration, or dramatic reductions in development time relative to firms’ normal NPD cycles. Across two studies, the authors interview managers to develop a typology of strategic motivations for discontinuous NPD acceleration, followed by a survey of 218 NPD managers to validate the typology and identify important differences across firm types, including those in new product performance, innovation levels, and configurations of organisational characteristics. The results suggest that discontinuous NPD acceleration is most profitable when firms are proactive and have specific configurations of culture, capabilities, and structure. The authors also discuss implications for theory, practice, and future research.     

Multi-stakeholder brand narratives: an analysis of the construction of artistic brands

Abstract

In the case of visual artists, the product they create is inextricably linked to their identities, personalities and career histories in terms of how the art is produced, presented, consumed and positioned and valued in the market. Although artists’ branding initiatives are considered relevant to branding and marketing theory, identifying how these are constructed and managed and identity negotiated through this process is an area that needs further development. This research therefore uses a multi-stakeholder approach to branding theory to examine contemporary artists’ careers to understand how value is added to their ‘product’. Qualitative analysis of artists’ biographies and career histories in the London art market illustrates how value is co-constructed through relationships in a temporal manner that must be strategically managed.     

Polyethnic market orientation and performance: A fast-moving consumer goods perspective

Abstract

The paper explores the market-oriented behaviour and performance consequences for firms operating in a market characterised by national heterogeneity. Through a case-study design, a posteriori propositions based on interview data from six multinational firms operating in a polyethnic market are developed. Findings indicate a positive relationship between the need for responsiveness and a market's polyethnicity with firms customising elements of their product strategy to ethnic segments or European consumers at large. Moreover, findings indicate that market-oriented firms that customise their product strategies to the cultural idiosyncrasies of the Greek market enjoy the highest market share among foreign consumers. As a result, the paper opens up a discussion on the performance implications of adopting a market-oriented approach in polyethnic markets, which are, increasingly, a feature of our globalised world.     

Retraining the process of new product development: From “stages” models to a “blocks” framework

The traditional view of the process of new product development (NPD), which is often prescribed as a series of activity “stages”, is critically reviewed. A number of problems are identified with this and other approaches to NPD as accurate representations of the process, such as their concentration on intra‐firm aspects and their ordered and sequential structure. The paper argues for an alternative approach, based on variable “blocks” of NPD activities, which also takes account of external organizations' involvement in the process.     

Market-Oriented New Product Design of Functional Orange Juice Beverages: A Qualitative Approach

Abstract

The functional beverages category is considered one of the most significant drivers of new product development (NPD) in recent years. Fifteen in-depth interviews and three focus groups were held between February and March 2003 to identify the most important attributes influencing consumers' purchase decisions for orange juice, and to explore consumers' attitudes towards existing and new functional orange juice beverages. The results suggested that functional food and beverage manufacturers should place a greater emphasis on the base product when evaluating new product concepts. This study highlighted the key role of qualitative research in facilitating the integration of consumers with the concept stage of the NPD process.     

Taiwanese Retailing: Market Analysis and Retail Branding Model Application

ABSTRACT

The Taiwanese retail market is in a highly competitive stage. In the past three decades, the Taiwan retail grocery market has experienced many developments and changes, and recently, has started to realize the importance of developing its own retail brand. Although the idea of retail branding is still new in Taiwan, the major hypermarket players have tried to build up their own brand image and create new own label products which differ from other competitors. This paper explores retail branding in the Taiwan hypermarket industry through macro/micro environment analysis and applying retail branding models to the Taiwanese retail market. The macro/micro environment analysis is undertaken by the two STEPs model and the retail branding model is created from Dawson's three levels model combined with previous studies and theories. The approach in this study involves literature reviews and secondary research in the field of the Taiwanese retail market. The outcome of this study is to highlight key issues that deserve further research.     

New Product Development Process Implementation in a Business-To-Business Firm: The Driving and Moderating Factors for Improved Program Performance and Time-To-Market

Purpose: The study aims to examine the critical factors affecting the implementation of a formalized new product development (NPD) process in a business-to-business (B-to-B) company with product-driven growth.

Methodology/approach: Case study using a combination of survey, artifacts, and long interviews

Findings: The findings suggest that (1) the initial phase proficiency can improve NPD effectiveness (NPD program performance) and NPD efficiency (i.e., time-to-market), but this relationship is moderated by the effective communication of the new NPD process throughout the entire firm; (2) the process formalization enhances time-to-market and NPD program performance, but its effects are asymmetric and contingent upon the decision concerning the inclusion of ad hoc and extended NPD team members; and (3) the product approval (executive) committee’s (PAC) ineffective communication could alienate team members from NPD efforts while resource availability moderates the influence of PAC’s decision making quality on time-to-market.

Research implications: Future research could examine the PAC decision-making quality as a multidimensional construct, composed of rigor and timeliness dimensions. That way, a more granular understanding of the effect of PAC decisions could be achieved. Future studies could make a clear distinction of the NPD process type in the study context when NPD decisions are examined.

Practical implications: Managers should acknowledge that decision-making processes and their comprehension by worker bees affect an NPD program’s success. It is interesting to note that removing go-no go decisions by the product approval committees at each phase may not lead to faster product development as these executive committee meetings have double entendre: they are not only to get the executives informed and get their signoff, but also is a facilitator to capital approvals. Hence, appropriate measures must be taken to remove or ease all bottlenecks in the NPD process.

Originality/value/contribution: This study uncovers several crucial factors that can improve the effectiveness and time-to-market of an NPD program in B-to-B companies, especially when firms implement a new formalized NPD process.     

Case Study

ABSTRACT

This is a case study of one of the highest growth restaurant chains in overall system wide sales and unit growth in restaurant industry history as reported by The Nation's Restaurant News(2001). The inception of a small fledgling restaurant chain in Atlanta, Georgia to a multi-billion dollar company has changed the shape of restaurant industry growth and development. The practices of franchise growth and market penetration have allowed Applebee's International to record double digit profits over the last ten years. Future growth patterns, market saturation, and changing consumer preferences will be challenges that Applebee's will face in the future. This case study will outline Applebee's history and competitive strategies that have made the company successful. Further along in the case study an analysis of franchising in the restaurant industry and the franchising strategies Applebee's has produced over the years. This study will conclude by uncovering future issues that Applebee's may face and pose future questions to ponder about the company.     

The causes of product deletion in British manufacturing companies∗

Increasing technological and market changes present companies with business opportunities which demand that firms match their capabilities to these changes. In short, the greater the change in the firm's environment, the greater the need to develop the product mix in consonance with the environment. This need for the development and redevelopment of the product mix—which is the essence of product policy—has resulted in a continual interest on the part of both academics and practitioners in innovation and new product development (NPD) (Rothwell et al. 1974, Gardiner and Rothwell 1985, Cooper 1979, 1984, Johne and Snelson 1987, Parkinson 1980). Yet to equate product mix change with product proliferation leads to an incomplete understanding of product policy which eclipses the crucial tasks of identifying and withdrawing products which no longer contribute to the company's goals. This article addresses the latter issue by discussing the way in which products like these come under the scrutiny of management and it explores the various triggers of product deletion.     

Benefits or Problems as Market Segmentation Bases—A Comment

Abstract

This comment constructively re-examines Van Auken's and Lonial's (1984) article in regards to its capacity to (1) conclude that problems and benefits are independent theoretical constructs and (2) to determine the suitability of segment congruence analysis (SCA) and the log-linear modeling in market segmentation research. A few conceptual and methodological caveats are identified, with the objective of facilitating future research into the potential of “problem data” and the value of SCA and log-linear modeling.     

Consumer spirituality

ABSTRACT

Consumers increasingly turn to the marketplace in search of spiritual well-being. In this introduction to the special issue, we unpack the concept of consumer spirituality. We define consumer spirituality as the interrelated practices and processes engaged in when consuming market offerings (products, services, places) that yield 'spiritual utility'. The market offerings are purposely designed to quench consumers’ thirst for meaningful encounters with one’s inner self or a higher external power. We identify three vehicles – materiality, embodiment, and technology – that consumers engage with to access consumer spirituality. By unpacking the concept of consumer spirituality along three themes - (1) shaping markets for consumer spirituality, (2) the means for accessing consumer spirituality, and (3) making sense of and researching consumer spirituality - we provide a future research agenda to advance scholarly explorations of consumer spirituality and to facilitate a systematic development of this nascent body of literature in marketing and consumer research.     

Romanticism,Introspection and Consumption: A Response to Professor Holbrook

This paper is concerned to challenge representational discourses which profess to identify the existence of a distinct and objectively identifiable “women's market” for financial services. Aided by an array of postmodern deconstructive techniques this paper reveals the discourse of a “women's market” as productive of, as well as constituted by, a particular form of modern society, one dominated by mass consumption to individualised subjects desperate for a sense of collective meaning and identity both as distinctive and embedded in a recognisable culture.     

Local Heroes,Regional Champions or Global Mandates? Empirical Evidence on the Dynamics of German MNC Subsidiary Roles in Central Europe

SUMMARY

In this paper we analyze the influence of a subsidiary's external environment, of its task and of its mode of ownership and its mode of market entry on the development of its role for the case of German subsidiaries in Central Europe. We define a subsidiary's role as a three-dimensional construct, consisting of a subsidiary's tasks, its value chain activities and its respective geographical scope. Drawing on a sample of 99 subsidiaries from the Czech Republic, Hungary, and Poland, we find that a subsidiary's host country, its tasks and its mode of market entry influence the development of its role. We find no evidence for the influence of subsidiary's mode of ownership. Especially, “geographical market proximity seeking”-subsidiaries seem to follow a different path of development than subsidiaries where this task is of minor importance as they tend to perform a smaller number of value chain activities and tend to expand these value chain activities with regard to their geographical scope more incrementally.     

Towards a conceptual model of country market selection: Selection processes of retailers and C&C wholesalers

Abstract

International market selection is discussed in general, particularly in respect of decisions on evaluation stages, selection criteria and evaluation methods. The present analysis focuses on the configuration of country selection models, which has received little attention in international retailing research. In order to illustrate the special features of market selection in retailing, we have used an innovative approach. Following a review of general theoretical perspectives, a case study of the Metro Group addresses the process used, inter-country selection and country-specific selection, and also shows the role of corporate principles and firms' situational factors. Based on existing literature and the case study information, we propose a strategic approach in modelling country selection processes. Three steps in the construction of a selection model are discussed and related to corporate principles and situational factors of a retail firm. The analysis is a further step towards understanding the processes of retailing internationalization.     

Exploring the Role of Product Development Capability for Transforming Marketing Intelligence into Firm Performance

ABSTRACT

Purpose: This study examines the role of product development capability for transforming marketing intelligence activities into firm performance on industrial markets.

Methodology/Approach: The authors apply structural equation modeling to analyze survey data from 342 industrial manufacturing companies.

Findings: Results reveal that sales integration and holistic macroeconomic view are particularly important features of the marketing intelligence capability on industrial markets to gain additional insights in order to develop products successfully. Results also reveal that product development capability transforms the marketing intelligence activities into firm performance on industrial markets.

Research Implications: This study offers new insights on marketing theory by extending and concretizing the concept of market orientation to a broader concept of the marketing intelligence capability for industrial markets. Further, this research reveals that the product development capability serves as a mediator to business performance.

Practical Implications: This study’s systematic and tangible outline of the dimensions of marketing intelligence and its link to the product development capability helps firms to better understand how to capitalize on market orientation’s potential values.

Originality/Value/Contribution: This research (a) reveals the relevant dimensions of marketing intelligence on industrial markets and (b) shows how the product development capability tranforms marketing intelligence activities into firm performance on industrial markets.     

A Neural Network for Predicting Manufacturers' Perceived Cooperation with Distributors in the New Product Development Process

ABSTRACT

This research has two objectives. The first is to develop a conceptual neural network for studying manufacturer-distributor cooperation in the new product development (NPD) process and to compare the neural network directly with the traditional multiple regression. The second objective is to examine the relative importance of the antecedents of manufacturer-distributor cooperation. Data from 295 U.S. manufacturing firms are used to test the neural models. The study demonstrates that neural network analysis is a good method predicting manufacturer-distributor cooperation in the NPD process. The results also show that the ranking of antecedents of manufacturer-distributor cooperation from most to least important is: relative dependence, shared values, communication, commitment, and trust. Implications for NPD managers are offered at the end of the paper.