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.     

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.     

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.     

Brand-embedded interaction: a dynamic and personalized interaction for co-creation

Recognizing the importance of timely access to market knowledge for successful new product development (NPD), extant research has theoretically argued and empirically shown the value of consumer co-creation during the NPD process. While most research views consumer-generated content as definite or fixed, this paper reveals how firms can enhance the value of consumer-generated ideas by facilitating the exchange of relevant information during co-creation. The authors introduce brand-embedded interaction as a process that enables consumers to generate new product ideas that not only reflect user needs but also align with the brand’s goals and capabilities. Results from two quasi-field experiments using Twitter show that a higher degree of dynamic interaction and personalization during co-creation enables consumers to generate more constructive new product ideas or ideas that are valuable to both consumers and firms. Results offer important implications for both theory and practice regarding co-creation and new product development.     

THE ROLE OF LOGISTICS IN NEW PRODUCT DEVELOPMENT

For many firms, a program of successful new product development (NPD) projects is critical to overall company strategy. However, the role of logistics in NPD has rarely been researched. The purpose of this paper is to empirically test the relationship between logistics involvement in new product development and improvements in NPD project performance and NPD logistics performance. Senior logistics managers in manufacturing firms in the United States were surveyed to test these relationships. The analysis demonstrated NPD project performance and NPD logistics performance improved with the involvement of logistics in NPD.     

NPD speed vs. innovativeness: The contingent impact of institutional and market environments

Whereas new product development (NPD) speed and product innovativeness are two critical strategic determinants of firm performance, previous studies show inconclusive findings about their effects. Drawing on institutional and contingency perspectives, this study elucidates value appropriation issues in NPD and examines how the effects of NPD speed and technological radicalness are contingent on institutional frameworks and market conditions. Results from 244 high-tech companies in China show that dysfunctional competition enhances the effect of NPD speed, but legal inadequacy hinders the impact of technological radicalness on firm performance. Market growth strengthens the performance effect of NPD speed but restrains the effect of technological radicalness. In addition, technological radicalness demonstrates stronger effects on firm performance when demand uncertainty is high.     

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.     

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.     

Contingent effects of managerial guanxi on new product development success

A survey of new product development (NPD) managers finds both a linear, positive relationship between managerial guanxi and new product speed to market and an inverted U-shaped relationship between managerial guanxi and new product innovativeness. In addition, both transaction-specific investments (TSIs) and relationship commitment have a positive moderating impact on the relationship between managerial guanxi and new product speed to market. However, TSIs increase the damaging effect of managerial guanxi on new product innovativeness, whereas relationship commitment reduces such an effect. The results from this study can help business practitioners use guanxi to improve NPD performance under different contexts of inter-firm relationships.     

An investigation of the black-box supplier integration in new product development

This research examines black-box supplier integration in new product development (NPD). A model and several hypotheses are proposed to study the relationship between product task characteristics (importance and complexity), supplier integration, and product performance. Data from 136 U.S. high-tech firms were used to test the hypotheses. Results suggest that assessing the importance and complexity of NPD tasks is critical to the implementation of supplier integration innovation strategy. Firms are likely to perform NPD tasks that are related to firms' core competencies in-house. They tend to externalize complex tasks to suppliers in order to utilize suppliers' resources and to increase NPD speed. The black-box supplier integration influences the speed to market. However, it is more effective on speed to market when technology uncertainty is low than when technology uncertainty is high.     

The effect of technology management capability on new product development in China’s service-oriented manufacturing firms: a social capital perspective

Abstract

Technology management capability (TMC) and new product development (NPD) are important for China’s service-oriented manufacturers to achieve competitive advantage. In this study, TMC is conceptualized as comprising of four sub-level capabilities: searching, selecting, implementation and learning capabilities. Drawing from the theory of social capital, we hypothesize that social capital plays a role in the relationship between TMC and NPD performance. Our findings indicate that NPD performance and social capital are influenced by all the four sub-capabilities of TMC but the effect of each capability of TMC varies. Selecting capability is more significantly and positively related with NPD performance, while learning capability exerts the most significant positive effect on social capital. Moreover, our empirical findings indicate the partial mediating role of social capital in the process of TMC influencing NPD performance. This study makes a particular contribution to the literature by providing a more complete understanding of how social capital plays a role in the relationship between TMC and NPD performance. In terms of managerial implications, our results indicate that improving TMC is essential in enhancing a service-oriented manufacturing firm’s NPD performance. Managers should also pay particular attention to nurturing social capital as a pathway to realize the true value of TMC.     

Re‐innovation and robust designs: Producer and user benefits

New waves of technologies have been sweeping through all industrial sectors in the 1980s. Increasingly, corporate managers have begun to use technology strategies as a major competitive tool. Within these strategies, there are at least a dozen different patterns of redesign and re‐innovation. Overall, one of the most important philosophies has been development of robust design configurations. These robust designs have a product family of variants which meet changing market needs with benefits for both producers and users.     

New product development in the financial service industry: A case study

New product development is an important aspect of service marketing. Information, however, is sparse on the actual development processes that are used by service firms to develop these new products. Utilizing a case study approach this article traces the development of a new service for a major UK based financial institution. Through an in‐depth examination of the processes it was found that a complex development system was used. The authors were able to identify a number of factors that were essential to the successful development of this new product.     

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.     

The corporate social responsibility (CSR) employer brand process: integrative review and comprehensive model

ABSTRACT

Firms are increasingly drawing on corporate social responsibility (CSR) in their employer branding to improve attractiveness and engage current and potential employees, and to ensure consistency in employee brand behaviours. However, there is a dearth of literature synthesising CSR and employer branding research to understand employee engagement with CSR-firms from a branding perspective. In this article, the authors carried out an integrative literature review of CSR and employer branding literatures. Informed by signaling theory, the authors develop a conceptual model of the CSR employer branding process as a cohesive view from the potential and current employee perspective. Our review highlights the need for firms to achieve CSR consistency in terms of (a) embeddedness of CSR values, and (b) levels of internal CSR. These two factors frame a typology that enable managers to better execute their CSR employer brand identity to achieve favourable results, such as a high-quality talent pool and positive affective, cognitive and behavioural employee outcomes.     

Strategic Types and Growth Strategies Used by Public Accounting Firms

ABSTRACT

Results of a survey of accounting firms suggests that market penetration is the preferred strategy among accounting firms followed by market development, service development and diversification. Using the Miles and Snow typology, prospectors were most aggressive in their preference for any strategy, followed by analyzers, defenders and reactors. Most small accounting firms were self typed as defenders or reactors suggesting their use of marketing concepts and strategies is limited.     

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.     

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.     

The market research contribution to new product failure and success

This paper examines the use made by management of market research data in the evaluation of new product development (NPD) projects. Stressing the need for a systematic approach to NPD the paper sets out four brief case histories, the products being Crocodillo, Paul Masson wine, the Prudential's Holburn UK Unit Trusts, and Golden Wonder's Preludes. These case histories illustrate both the value of a systematic approach to NPD by building up a market research programme and also the limitations of market research data which cannot alone be any guarantee of success.     

Cultural Values,Economic Growth and Development

This empirical study investigates the effects of nine ethical climate types (self-interest, company profit, efficiency, friendship, team interest, social responsibility, personal morality, company rules and procedures, and lastly laws and professional codes) on employee work satisfaction. The ethical climate typology developed by Victor and Cullen (in W. C. Frederick (ed.) Research in Corporate Social Performance and Policy, 1987; Administrative Science Quarterly 33, 101–125, 1988) is tested on a sample of staff and managers from 62 different telecommunication firms in Turkey. The results obtained from the 1174 usable questionnaires confirm the existence of nine different ethical climate types observed in western cultures in the present sample context, which is a developing Muslim country. Regarding the effects of ethical climatic factors on employee work satisfaction, self-interest climate type appears to negatively influence work satisfaction, whereas team interest, social responsibility and law and professional codes climate types are found to have positive impacts. Managerial and further research implications of the findings are discussed.