Increasing Learning and Time Efficiency in Interorganizational New Product Development Teams*

Despite the growing popularity of new product development across organizational boundaries, the processes, mechanisms, or dynamics that leverage performance in interorganizational (I‐O) product development teams are not well understood. Such teams are staffed with individuals drawn from the partnering firms and are relied on to develop successful new products while at the same time enhancing mutual learning and reducing development time. However, these collaborations can encounter difficulties when partners from different corporate cultures and thought worlds must coordinate and depend on one another and often lead to disappointing performance. To facilitate collaboration, the creation of a safe, supportive, challenging, and engaging environment is particularly important for enabling productive collaborative I‐O teamwork and is essential for learning and time efficient product development. This research develops and tests a model of proposed factors to increase both learning and time efficiency on I‐O new product teams. It is argued that specific behaviors (caring), beliefs (psychological safety), task‐related processes (shared problem solving), and governance mechanisms (clear management direction) create a positive climate that increases learning and time efficiency on I‐O teams. Results of an empirical study of 50 collaborative new product development projects indicate that (1) shared problem solving and caring behavior support both learning and time efficiency on I‐O teams, (2) team psychological safety is positively related to learning, (3) management direction is positively associated with time efficiency, and (4) shared problem solving is more strongly related to both performance dimensions than are the other factors. The factors supporting time efficiency are slightly different from those that foster learning. The relative importance of these factors also differs considerably for both performance aspects. Overall, this study contributes to a better understanding of the factors that facilitate a favorable environment for productive collaboration on I‐O teams, which go beyond contracts or top‐management supervision. Establishing such an environment can help to balance management concerns and promote the success of I‐O teams. The significance of the results is elevated by the fragility of collaborative ventures and their potential for failure, when firms with different organizational cultures, thought worlds, objectives, and intentions increasingly decide to work across organizational boundaries for the development of new products.     

Knowledge Sharing in Interorganizational Product Development Teams: The Effect of Formal and Informal Socialization Mechanisms*

Working collaboratively with suppliers is increasingly cited as a “best practice” in product development. The importance of sharing knowledge between buyer and supplier in this context has been well recognized, although comparatively little research exists on the interorganizational socialization mechanisms that facilitate it. The present research proposes and tests a theoretical model of the impact of formal and informal socialization mechanisms on the level of knowledge sharing within interorganizational product development projects and the subsequent effect on buyer firm performance. Results from this study of 111 manufacturing organizations in the United Kingdom largely support its hypotheses. It is revealed that informal socialization mechanisms (e.g., communication guidelines, social events) play an important role in facilitating interorganizational knowledge sharing, whereas formal socialization mechanisms (e.g., cross‐functional teams, matrix reporting structures) act indirectly through informal socialization to influence knowledge sharing. The results also show that interorganizational knowledge sharing is positively associated with supplier contribution to development outcomes, which, in turn, improves buyer product development performance and, ultimately, financial performance. Product development managers are encouraged to build social ties between interorganizational development teams to increase the flow of knowledge and to improve both product development outcomes and financial performance.     

Exploring New Product Development Project Review Practices*

Most organizations use new product development (NPD) processes that consist of activities and review points. Activities basically solve problems and gather and produce information about the viability of successfully completing the project. Interspersed between the development activities are review points where project information is reviewed and a decision is made to either go on to the next stage of the process, stop it prior to completion, or hold it until more information is gathered and a better decision can be made. The review points are for controlling risk, prioritizing projects, and allocating resources, and the review team typically is cross‐disciplinary, comprising senior managers from marketing, finance, research and development (R&D), or manufacturing. Over the past four decades, research has greatly advanced knowledge with respect to NPD activities; however, much less is known about review practices. For this reason, the present paper reports findings of a study on NPD project review practices from 425 Product Development & Management Association (PDMA) members. The focus is on three decision points in the NPD process common across organizations (i.e., initial screen, prior to development and testing, and prior to commercialization). In this paper, the number of (1) review points used, (2) review criteria, (3) decision makers on review committees and the proficiency with which various evaluation criteria are used are compared across incremental and radical projects and across functional areas (i.e., marketing, technical, financial). Furthermore, the associations between these NPD review practices and new product performance are examined. Selected results show that more review points are used for radical NPD projects than incremental ones, and this is related to a relatively lower rate of survival for radical projects. The findings also show that the number of criteria used to evaluate NPD projects increases as NPD projects progress and that the number of review team members grows over the stages, too. Surprisingly, the results reveal that more criteria are used to evaluate incremental NPD projects than radical ones. As expected, managers appear to more proficiently use evaluation criteria when making project continuation/termination decisions for incremental projects; they use these criteria less proficiently during the development of radical projects, precisely when proficiency is most critical. At each review point, technical criteria were found to be the most frequently used type for incremental projects, and financial criteria were the most commonly used type for radical ones. Importantly, only review proficiency is significantly associated with performance; the number of review points, review team size, and number of review criteria are not associated with new product performance. Furthermore, only the coefficient for proficiently using marketing criteria was significantly related to new product program performance; the proficiency of using financial and technical information has no association with performance. Finally, across the three focal review points of the NPD process in this study, only the coefficient for proficiency at the first review point, (i.e., the initial screen) is significantly greater than zero. The results are discussed with respect to research and managerial practice, and future research directions are offered.     

Can You Hear Me Now? Communication in Virtual Product Development Teams*

Globalization and technological advances are driving organizations to extend the boundaries of new product development (NPD) teams from traditional colocated settings to dispersed or virtual settings. Virtual NPD teams have a wide array of information and communication technologies (ICTs) at their disposal. ICTs allow team members to communicate and collaborate as they cope with the opportunities and challenges of cross‐boundary work. The purpose of this paper is to explore ICT use by members of virtual NPD teams. This study presents an exploratory test and integration of two competing perspectives of media use in virtual teams: media capacity theories and social dynamic media theories. Specifically, this paper examines the role of task type, organizational context, and ICT type as critical contingency variables affecting ICT use. It also examines how different patterns of ICT use relate to individual perceptions of team performance. The findings from this study of 184 members of virtual NPD teams in three global firms suggest that communication via ICTs in virtual NPD teams is contingent on a range of factors.     

Autonomous Teams and New Product Development

An autonomous team is an emerging tool for new product development (NPD). With its high degree of autonomy, independence, leadership, dedication, and collocation, the team has more freedom and stronger capabilities to be innovative and entrepreneurial. Several anecdotal cases suggest that autonomous teams are best when applied to highly uncertain, complex, and innovative projects. However, there is no empirical study to test such a notion. Moreover, autonomous teams are not a panacea, and implementing them can be costly and disruptive to their parent organization. When should this powerful, yet costly tool, be pulled out of the new product professional's toolbox? This paper attempts to answer this question. The objective of this study is to explore under which circumstances an autonomous team is the best choice for NPD. Based on contingency and information‐processing theories, autonomous teams are hypothesized to be more effective to address projects with: (1) high technology novelty and (2) radical innovation. To test these hypotheses, the relative effectiveness of four types of team structures: autonomous, functional, lightweight, and heavyweight are compared. The effectiveness measures include development cost, development speed, and overall product success. Vision clarity, resource availability, and team experience are the controlled variables. The empirical results based on the data from 555 NPD projects generally support the research hypotheses. Relative to other team structures, autonomous teams are more effective in addressing projects with high technology novelty or radical innovation. The results also suggest that heavyweight teams perform better than other teams in developing incremental innovation. These results provide some evidence to support contingency and information‐processing theories at the project level. Given the importance of the development of novel technology and radical innovation in establishing new businesses and other strategic initiatives, the findings of this study may not only have some important implications for NPD practices but may also shed some light on other important topics such as disruptive innovation, strategic innovation, new venture, corporate entrepreneurship, and ambidextrous organization.     

The Effect of Multiknowledge Individuals on Performance in Cross‐Functional New Product Development Teams*

This study examines the effect of multiknowledge individuals (especially those possessing both marketing and technological knowledge) on performance in cross‐functional new product development teams. A survey of 62 cross‐functional teams shows that the proportion of multiknowledge individuals has an indirect positive effect through information sharing on product innovativeness and a direct positive effect on time efficiency of new product development teams.     

Leadership Differences in New Product Development Teams

Innovativeness is unlikely without skilled leaders to guide the teams which develop new products and technologies. Although the importance of leadership to innovation success is often discussed, the specific practices of effective team leaders are not. In this study, Gloria Barczak and David Wilemon focus on the roles, functions and methods employed by leaders of operating and innovating types of new product development teams. Operating teams are part of the daily activities of the firm, are involved with current markets and develop products similar to current product offerings. Innovating teams do not routinely engage in day-to-day activities. They pursue new markets and develop products quite different from existing ones. The results suggest that successful leaders of both types of teams perform similar roles and functions. However, the methods they use to achieve them vary by the type of new product development team.     

Learning in New Technology Development Teams

One factor that may distinguish effective new product development teams from ineffective ones is the ability to learn in purposeful and cumulative ways. History can sometimes teach important lessons, yet history is not always transmitted efficiently within organizations. Patricia Meyers and David Wilemon present a study of new product development teams' learning in technology-based organizations. They note especially the learning modes employed by teams, the conditions blocking team learning which create errors and the learning transfer among teams. Using findings from previous and current research, the authors establish the importance of effective team learning whenever teams are asked to deal with complex new product development challenges. Further, they suggest ways to create a productive learning climate for new product teams and close with a discussion of both managerial implications and suggestions for further research.     

Using Exploratory and Exploitative Market Learning for New Product Development*

While the need for research on the market‐learning efforts of a firm in relation to its new product development is continuously emphasized, the empirical results on this issue reported so far have been mixed. The current study contends that the inconclusive nature of the empirical evidence is mostly due to the existence of different dimensions of organizational market learning—exploratory and exploitative—and to possible different routes by which these learning dimensions are linked to new product performance. More specifically, this study argues that exploratory market learning contributes to the differentiation of the new product because it involves the firm's learning about uncertain and new opportunities through the acquisition of knowledge distant from existing organizational skills and experiences. By contrast, this study posits that exploitative market learning enhances cost efficiency in developing new products as it aims to best use the currently available market information that is closely related to existing organizational experience. This study provides empirical support for this two‐dimensional scheme of organizational market learning and its consequent effects on two components of new product advantage: new product differentiation and cost efficiency. Further, given that the effectiveness of firms' strategic efforts is contingent upon the nature of the market environment, the current study examines the moderating effects of environmental dynamism and market competitiveness for this market learning—new product advantage relationship. This study is based on survey data from 157 manufacturing firms in China that encompass various industries. The empirical findings support the two‐dimensional market learning efforts that increase new product differentiation and cost efficiency, respectively. The study confirms that exploratory market learning becomes more effective under a turbulent market environment and that exploitative market learning is more contributive when competitive intensity is high. It also suggests that because of their differential direct and moderating effects on new product advantage either exploratory or exploitative market learning may not be used exclusively, but the two should be implemented in parallel. Such learning implementations will help to secure both the feature and cost‐based new product advantage components and will consequently lead to the new product success. The current study attempts to contribute to greater clarity and better understanding of how market learning influences new product success as it theoretically identifies and empirically validates the two forms of new product advantage as the conceptual mediator between market learning and new product performance.     

Crossfunctional Teams in Product Development: Accommodating the Structure to the Process

This article reports the conclusions from a study of crossfunctional product development teams with emphasis on the implications for altering organizational structure to accommodate team process. A comparative study of teams in four U.S.firms, using anthropological and sociolinguistic methods, found that team work is inherently paradoxical. It poses numerous contradictions and paradoxes for individuals, teams, and organizations. At one of the research sites, tacit recognition of this reality and a conviction that teams were critical to product development led to a continuous accommodation of the organization to the requirements of team work and to impressive organizational outcomes. Conceptual and managerial lessons are drawn from this successful case and are offered here to help guide both future research and the actual implementation of team work in firms.     

Procedural Justice Climate in New Product Development Teams: Antecedents and Consequences

With the increasing interest in the concept of justice in the group behavior literature, the procedural justice (PJ) climate attracts many researchers and practitioners from different fields. Nevertheless, the PJ climate is rarely addressed in the new product development (NPD) project team literature. Specifically, the technology and innovation management (TIM) literature provides little about what the PJ climate is, its nature and benefits, and how it works in NPD project teams. Also, few studies investigate the antecedents and consequences of the PJ climate in NPD teams enhancing the understanding of this concept from a practical perspective. This paper discusses the PJ climate theory in a NPD team context and empirically demonstrates how team members' positive collective perceptions of a PJ climate can be developed and how a PJ climate influences a project's performance in NPD teams. In particular, team culture values including employee orientation, customer orientation, systematic management control, innovativeness, and social responsibility were investigated as antecedents, and team learning, speed to market, and market success of new products were studied as outcomes of PJ climate in this paper. By studying 83 NPD project teams it was found on the basis of using partial least squares (PLS) method that (1) the level of employee, customer and innovativeness orientation as well as systematic management control during the project had a positive impact on developing a PJ climate in an NPD team; (2) a PJ climate positively affects team learning and product development time (i.e., speed to market); and (3) team learning and speed to market mediate the relations between the PJ climate and new product success (NPS). Based on the findings, this paper suggests that managers should enhance the PJ climate and team culture in the project team to enhance team learning and to develop products faster. In particular, managers should (1) open a discussion forum among people and create a dialogue for people who disagree with the other project team members rather than dictating or emposing others ideas to them, (2) facilitate information searching and collecting mechanisms to make decisions effectively and to clarify uncertainties, and (3) allow team members to challange project‐related ideas and decisions and modify them with consensus. Also, to enhance the PJ climate during the project, managers should (1) respect and listen to all team members' ideas and try to understand why they are sometimes in opposition, (2) define team members' task boundaries and clarify project norms and project goals, and (3) set knowledge‐questioning values by facilitating team members to try out new ideas and seek out new ways to do things.     

The Effect of Interactional Fairness on the Performance of Cross‐Functional Product Development Teams: A Multilevel Mediated Model*

Cross‐functional product development teams (CFPDTs) are receiving increasing attention as a fundamental mechanism for achieving greater interfunctional integration in the product development process. However, little is known about how team members' interactional fairness perception—fairness perception based on the quality of interpersonal treatment received from the project manager during the new product development process—affects cross‐functional communication and the performance of CFPDTs. This study examines the effects of interactional fairness on both team members' performance and team performance as a whole. It was predicted that interactional fairness in CFPDTs would significantly affect team members' task performance, both task‐ and person‐focused interpersonal citizenship behaviors, as well as team performance. Additionally, commitment would partially mediate the effects of interactional fairness on these performance outcomes. Analyzing survey responses from two student samples of CFPDTs with hierarchical linear modeling techniques, it was demonstrated that team members' task performance, interpersonal citizenship behavior, and team performance are enhanced when team members are dedicated to both the team and the project, and such dedication is fostered when project managers are fair to team members in an interpersonal way.     

Antecedents and Consequences of Unlearning in New Product Development Teams

Unlearning, which first appeared almost 30 years ago as a subprocess of the organizational learning process, has received only limited attention in the literature. Rather than building on empirical research, the existing scholarship is largely anecdotal, aimed at reviewing the literature and generating new insights. Further, unlearning studies tend to analyze the organizational level and neglect smaller units such as work groups and teams. To address this gap in the understanding of unlearning, this article empirically investigates unlearning in work groups in general and new product development (NPD) teams in particular. This study, based on the literature of organizational memory and change, operationalized team unlearning as changes in beliefs and routines during team‐based projects and then discussed the importance of unlearning behavior in NPD teams. Specifically it was argued that unlearning guards beliefs and routines against rigidity to cope with environmental turbulence. This is of particular note when rigid product development procedures and group beliefs inhibit the reception and evaluation of new market and technology information and reduce the value of perceived new information. To test the antecedents and consequences of the team unlearning model, 319 NPD teams were investigated. Using structural equation modeling, it was found that (1) team crisis and anxiety have a direct impact on team unlearning; (2) environmental turbulence also has a direct impact on both team crisis and anxiety and team unlearning; and (3) after team beliefs and project routines have changed, implementing new knowledge or information positively affects new product success. Specifically, the findings revealed that changes in team members' collective beliefs in accordance with environmental changes and the in‐process planning or adjustment of project work activities and procedures as the projects evolve enable teams to develop and launch new products successfully. Also, results indicated that team crisis and anxiety in NPD projects assist team members in revising their previous beliefs and routines when project teams are performing in turbulent environments. This article suggests that managers can enhance team unlearning by (1) creating a sense of urgency by introducing an artificial crisis; and (2) avoiding the groupthink phenomena by bringing in an outsider to challenge existing policies and procedures, and training the team on lateral thinking. In addition, managers can plan project activities in a flexible manner that allows changes as the project evolves to facilitate team unlearning. However, managers should also be cautious when promoting team unlearning. Without careful and considerable evaluation, change in beliefs and routines can cause information/knowledge loss.     

First among Equals: The Effect of Team Leader Characteristics on the Internal Dynamics of Cross‐Functional Product Development Teams*

Drawing on the path‐goal theory of leadership, the present study examines the effect of team leader characteristics on an array of conflict resolution behavior, collaboration, and communication patterns of cross‐functional new product development (NPD) teams. A hierarchical linear model analysis based on a survey of 246 members from 64 NPD teams suggests that participative management style and initiation of goal structure by the team leader exert the strongest influence on internal team dynamics. Both these leadership characteristics had a positive effect on functional conflict resolution, collaboration, and communication quality within the NPD team while discouraging dysfunctional conflict resolution and formal communications. Comparatively, team leader's consideration, initiation of process structure, and position had a surprisingly weak effect on internal team dynamics. Further, the findings underscore the differential effects on various dimensions of team dynamics, the importance of controlling for project and team characteristics, and the use of multilevel modeling for studying nested phenomena related to NPD teams. Implications of these findings are discussed.     

Soaking It Up: Absorptive Capacity in Interorganizational New Product Development Teams

Prior research has acknowledged the importance of an organization's absorptive capacity—the ability to acquire new knowledge and information, assimilate, transform, and exploit it—for innovation purposes. Because innovations are usually developed by project teams, this suggests that absorptive capacity, as a construct, may also be usefully applied at the team level. Consequently, this study developed a measure for team‐level absorptive capacity, investigated the potential influencing factors, and examined its relationship to team effectiveness in terms of product innovativeness in an interorganizational context. Specifically, building on the theory of homophily and information and decision‐making theories, three factors (social‐category similarity, work‐style similarity, and knowledge complementarity between the recipient and the partner organization teams) were identified as likely antecedents of team absorptive capacity. The hypotheses were tested on data from 98 interorganizational new product development teams and included responses from team members, team leaders, and team‐external managers. With regard to the antecedents of team absorptive capacity in interorganizational settings, the results showed a significant positive association with partners' work‐style similarity and an inverted U‐shaped relationship with partners' knowledge complementarity. Social‐category similarity was not significantly associated with team absorptive capacity. We also examined whether team absorptive capacity was related to interorganizational team effectiveness and found a significant positive relationship between team absorptive capacity and product innovativeness. The study demonstrates that absorptive is indeed related to team effectiveness outcomes in an interorganizational context, which underlines the importance of team‐level absorptive capacity for product innovation management and suggests paying more attention to the lower levels of absorptive capacity.     

Customer Empowerment in New Product Development*

The traditional new product development (NPD) model, in which companies are exclusively responsible for coming up with new product ideas and for deciding which products should ultimately be marketed, is increasingly being challenged by innovation management academics and practitioners alike. In particular, many have advocated the idea of democratizing innovation by empowering customers to take a much more active stake in corporate NPD. This has become feasible because the Internet now allows companies to build strong online communities through which they can listen to and integrate thousands of customers from all over the world. Extant research has provided strong arguments that indicate that customer empowerment in NPD enables firms to develop better products and at the same time to reduce costs and risks if customers in a given domain are willing and able to deliver valuable input. Customer empowerment, however, not only affects the firm's internal NPD processes as reflected in the products that are ultimately marketed. Instead, it might also affect the way companies are perceived in the marketplace (by customers who observe that companies foster customer empowerment in NPD). This paper provides the first empirical study to explore how customers from the “periphery” (i.e., the mass that does not participate) perceive customer empowerment strategies. Customer empowerment in NPD is conceptualized along two basic dimensions: (1) customer empowerment to create (ideas for) new product designs; and (2) customer empowerment to select the product designs to be produced. Therefore, customers may be empowered to submit (ideas for) new products (empowerment to create) or (2) to “vote” on which products should ultimately be marketed (empowerment to select). In the course of two experimental studies using three different product categories (T‐shirts, furniture, and bicycles) both customer empowerment dimensions (as well as its interaction) are found to lead to (1) increased levels of perceived customer orientation, (2) more favorable corporate attitudes, (3) and stronger behavioral intentions. These findings will be very useful to researchers and managers interested in understanding the enduring consequences of customer empowerment in NPD. Most importantly, the results suggest that empowerment strategies might be used to improve a firm's corporate associations as perceived by the broad mass of (potential) customers. In particular, marketers might foster customer empowerment as an effective means of enhancing perceived customer orientation. Customers will in turn provide rewards, as they will form more favorable corporate attitudes and will be more likely to choose the products of empowering as opposed to nonempowering companies, ceteris paribus. Customer empowerment thus constitutes a promising positioning strategy that managers can pursue to create a competitive advantage in the marketplace.     

Learning to Reduce Interorganizational Learning: An Analysis of Architectural Product Innovation in Strategic Alliances*

There is wide agreement in analyses of strategic alliances that, regardless of the purpose of the alliance, members of the partner organizations should engage in intensive mutual learning to make the alliance a success. In contrast to this view, the present article shows that in strategic alliances aimed at product innovations by recombining partners' extant technologies, learning between specialists can be reduced considerably without jeopardizing success. This is made possible through four interconnected mechanisms integrated into the concept of transactive organizational learning (TOL): (1) modularization, which allows specialists of different domains to develop modules to a large extent independently of each other and to concentrate communication between themselves on the design of interfaces between modules; (2) storing of knowledge in artifacts instead of in organizational members' memories; (3) localization of knowledge not present in the project team but for which a need has arisen through transactive memory; and (4) knowledge integration by prototyping (i.e., by repeated testing of modules and of interactions between modules until a satisfactorily working end product is achieved). Although these four mechanisms reduce the need for cross‐learning between specialists of different domains, some common knowledge and some cross‐learning between the partners' specialists is still required. Case studies on four of SAP's strategic alliances for product innovation with different partners lend empirical support to this study's concept. The article concludes with implications for practice: Companies should find out whether the TOL mechanisms that reduce time to market are present, to what extent their potential is exploited, and how well they work together.     

The Impact of Product Innovativeness on the Link between Development Speed and New Product Profitability*

A review of the literature reveals that the relationship between development speed and new product profitability is not as strong and straightforward as conventional wisdom suggests. A number of studies show positive results, others show mixed results, and some present no evidence of a relationship. In other words, the valence of the link between development speed and new product profitability is unclear at this time. Therefore, this study investigates whether or not speeding new products to market has positive or negative effects on new product profitability. Prior research shows that product innovativeness influences both development speed and new product profitability. This raises the question of whether increasing speed is equally successful in improving profitability across new products that differ in their degree of innovativeness. Therefore, this study also investigates the moderating effect of product innovativeness on the relationship between development speed and new product profitability. The results from a survey‐based study of 233 manufacturers of industrial products in the Netherlands reveal an inverted U‐shaped relationship between development speed and new product profitability. The findings also show that the optimal point is different for two new product types—product improvements and line additions—that vary in their innovativeness. These results provide an onset for the development of a decision tool that helps managers to determine how much to spend on accelerating the development of individual new products and how they should allocate that spending across products in their new product portfolio.     

Managing New Product Development Teams in a Globally Dispersed NPD Program

Globalization is a major market trend today, one characterized by both increased international competition as well as extensive opportunities for firms to expand their operations beyond current boundaries. Effectively dealing with this important change, however, makes the management of global new product development (NPD) a major concern. To ensure success in this complex and competitive endeavor, companies must rely on global NPD teams that make use of the talents and knowledge available in different parts of the global organization. Thus, cohesive and well‐functioning global NPD teams become a critical capability by which firms can effectively leverage this much more diverse set of perspectives, experiences, and cultural sensitivities for the global NPD effort. The present research addresses the global NPD team and its impact on performance from both an antecedent and a contingency perspective. Using the resource‐based view (RBV) as a theoretical framework, the study clarifies how the internal, or behavioral, environment of the firm—specifically, resource commitment and senior management involvement—and the global NPD team are interrelated and contribute to global NPD program performance. In addition, the proposed performance relationships are viewed as being contingent on certain explicit, or strategic, factors. In particular, the degree of global dispersion of the firm's NPD effort is seen as influencing the management approach and thus altering the relationships among company background resources, team, and performance. For the empirical analysis, data are collected through a survey of 467 corporate global new product programs (North America and Europe, business‐to‐business). A structural model testing for the hypothesized effects was substantially supported. The results show that creating and effectively managing global NPD teams offers opportunities for leveraging a diverse but unique combination of talents and knowledge‐based resources, thereby enhancing the firm's ability to achieve a sustained competitive advantage in international markets. To function effectively, the global NPD team must be nested in a corporate environment in which there is a commitment of sufficient resources and where senior management plays an active role in leading, championing, and coordinating the global NPD effort. This need for commitment and global team integration becomes even more important for success as the NPD effort becomes more globally dispersed.