Improvement reviews in new product development

This research examines how organizations can use improvement reviews to enhance learning from product development experiences. We review learning related literature and highlight learning barriers that firms should attempt to minimize when conducting reviews. We then discuss two studies aimed at better understanding the effectiveness of improvement reviews. The first study suggests that improvement reviews can facilitate learning by leading to a reduction in the recurrence of people-related problems, though reviews had no impact on reducing market or product related problems. The second study involved depth interviews with new product developers. Interview comments provide insights into improvement review best practices and shed light on why improvement reviews are sometimes ineffective. A set of managerial recommendations is provided.     

Learning to let go: Social influence,learning, and the abandonment of corporate venture capital practices

Research summary: This study examines the abandonment of organizational practices. We argue that firm choices in implementing practices affect how firms experience a practice and their subsequent likelihood of abandonment. We focus on utilization of the practice and staffing (i.e. career backgrounds of managers), as two important implementation choices that firms make. The findings demonstrate that practice utilization and staffing choices not only affect abandonment likelihood directly but also condition firms' susceptibility to pressures to abandon when social referents do. Our study contributes to diffusion research by examining practice abandonment—a relatively unexplored area in diffusion research—and by incorporating specific aspects of firms' post‐adoption choices into diffusion theory. Managerial summary: When do firms shut down practices? Prior research has shown that firms learn from the actions of other firms, both adopting and abandoning practices when their peers do. But unlike adoption decisions, abandonment decisions need to account for firms' own experiences with the practice. We study the abandonment of corporate venture capital (CVC) practices in the U.S. IT industry, which has experienced waves of adoption and abandonment. We find that firms that make more CVC investments are less likely to abandon the practice, and are less likely to learn vicariously from other firms' abandonment decisions, such that they are less likely to exit CVC when other firms do. Staffing choices also matter: hiring former venture capitalists makes firms less likely to abandon CVC practices, while hiring internally makes abandonment more likely. Plus, staffing choices affect how firms learn from the environment, as CVC managers pay attention to and learn more from the actions of firms that match their work backgrounds; i.e., firms that staff CVC units with former venture capitalists are more likely to follow exit decisions of VC firms, while those that staff with internal hires are more likely to follow their industry peers. Our results suggest that firms wanting to retain CVC practices should think carefully about the implementation choices they make, as they may be inadvertently sowing seeds of abandonment. Copyright © 2015 John Wiley & Sons, Ltd.     

PDMA Research on New Product Development Practices: Updating Trends and Benchmarking Best Practices

Product development professionals may have the feeling that yet another buzzword or magic bullet always lurks just around the corner. However, researchers have devoted considerable effort to helping practioners determine which tools, techniques, and methods really do offer a competitive edge. Starting 30 years ago, research efforts have aimed at understanding NPD practices and identifying those which are deemed “best practices.” During the past five years, pursuit of this goal has produced numerous privately available reports and two research efforts sponsored by the PDMA. Abbie Griffin summarizes the results of research efforts undertaken during the past five years and presents findings from the most recent PDMA survey on NPD best practices. This survey, conducted slightly more than five years after PDMA's first best-practices survey, updates trends in processes, organizations, and outcomes for NPD in the U.S., and determines which practices are more commonly associated with firms that are more successsful in developing new products. The survey has the following objectives: determining the current status of NPD practices and performance; understanding how product development has changed from five years ago; determining whether NPD practice and performance differ across industry segments; and, investigating process and product development tools that differentiate product development success. The survey findings indicate that NPD processes continue to evolve and become more sophisticated. NPD changes continually on multiple fronts, and firms that fail to keep their NPD practices up to date will suffer an increasingly marked competitive disadvantage. Interestingly, although more than half of the respondents use a cross-functional stage-gate process for NPD, more than one-third of all firms in the study still use no formal process for managing NPD. The findings suggest that firms are not adequately handling the issue of team-based rewards. Project-completion dinners are for the most frequently used NPD reward; they are also the only reward used more by best-practice firms than by the rest of the respondents. The best-practice firms participating in the study do not use financial rewards for NPD. Compared to the other firms in the study, best-practice firms use more multifunctional teams, are more likely to measure NPD processes and outcomes, and expect more from their NPD programs.     

Human Resource Management in the Japanese Financial Institution Abroad: The Case of the London Office

The evidence on human resource management in overseas offices of Japanese multinational service-sector firms is far less abundant than that for manufacturing firms. Existing studies describe employment practices that vary, both between firms and over time. To supplement the existing body of evidence, the present study investigates employment practices at two Japanese financial services firms in the City of London through the use of interviews and questionnaire surveys. It focuses on those facets of the ‘Japanese’ management system that may be considered fundamental characteristics: recruitment and selection procedures, training methods, pay and promotion policies, employment security, company culture, and the position of workers within the overall organization. The study considers the implications of changes over time within the two firms when viewed in the context of the existing evidence; such comparison suggests that both corporate strategy and human resource management policy in Japanese financial organizations may have changed during the 1980s.     

Organizing for solutions: Systems seller vs. systems integrator

This paper aims to examine how firms are organizing to provide integrated solutions: a business model for the supply of capital goods based on the provision of products and services as integrated solutions to individual customer's needs. The industrial marketing literature suggests that the origins of this business model can be traced back to early 1960s when firms adopted strategies and organizations for ‘systems selling’. The marketing literature helps us to identify two contrasting types of organizations: (1) the vertically-integrated systems seller that produces all the product and service components in a system; and (2) the systems integrator that coordinates integration of components supplied by external firms. The paper uses these two ideal types to analyse the strategies and organizations of five case study firms that have recently attempted to move into the provision of integrated solutions. It argues that there is no evidence to support the continuing dominance of the systems seller or a simple transition from systems selling to systems integration. A more complex pattern of organizational forms is emerging, combining elements of both systems selling (i.e. vertical integration into services) and systems integration.     

Dynamic or Static Capabilities? Process Management Practices and Response to Technological Change*

Whether and how organizations adapt to changes in their environments has been a prominent theme in organization and strategy research. Within this research, there is controversy about whether organizational routines hamper or facilitate adaptation. Organizational routines give rise to inertia but are also the vehicles for change in recent work on dynamic capabilities. This rising interest in routines in research coincides with an increase in management practices focused on organizational routines and processes. This study explores how the increasing use of process management practices affected organizational response to a major technological change through new product developments. The empirical setting is the photography industry over a decade, during the shift from silver‐halide chemistry to digital technology. The advent and rise of practices associated with the new ISO 9000 certification program in the 1990s coincided with increasing technological substitution in photography, allowing for assessing how increasing attention to routines through ISO 9000 practices over time affected ongoing responsiveness to the technological change. The study further compares the effects for the incumbent firms in the existing technology with nonincumbent firms entering from elsewhere. Relying on longitudinal panel data models as well as hazard models, findings show that greater process management practices dampened response to new generations of digital technology, but this effect differed for incumbents and nonincumbents. Increasing use of process management practices over time had a greater negative effect on incumbents' response to the rapid technological change. The study contributes to research in technological change by highlighting specific management practices that may create disconnects between firms' capabilities and changing environments and disadvantage incumbents in the face of radical technological change. This research also contributes to literature on organizational routines and capabilities. Studying the effects of increasing ISO 9000 practices undertaken in firms provides an opportunity to gauge the effects of systematic routinization of organizational activities and their effects on adaptation. This research also contributes to management practice. The promise of process management is to help firms adapt to changing environments, and, as such, managers facing technological change may adopt process management practices as a response to uncertainty and change. But managers must more fully understand the potential benefits and risks of process management to ensure these practices are used in the appropriate contexts.     

Integrating inside and outside innovators: a sociotechnical systems perspective

Innovation literature stresses the importance of opening the innovation process to internal and external innovators. The question of what determines the integration of these types of innovators in the innovation process remains open. We use a sociotechnical systems perspective to address a number of challenges with respect to this matter: an organization deploying different innovation practices to open the innovation process might not be aware which types of innovators are de facto integrated in its innovation process. Alternatively, an organization targeting the integration of a particular type of innovator might not use the suitable innovation practices to integrate the knowledge of this type of innovator. To address these challenges, our comparative case-study analysis in 15 medium-sized firms derives a theoretical framework proposing that a combined analysis of innovation practices and underlying social interactions is needed to decide about the integration of a particular type of innovator in the innovation process. Being aware of these interrelations will allow organizations to act more consciously when opening their innovation processes.     

Perspectives on roadmaps: how organizations talk about the future

Roadmaps, in the traditional sense, are concerned mostly with space and position. In the way that industrial and public research institutions use the term, though, roadmaps reveal the time dimension of technological progress. The many and increasing applications of roadmaps have generated confusion about what they are for and what they accomplish amid the many tools and techniques of managing technology. Roadmapping is itself a trend, while it seeks to exploit the trends underlying technology. The practice has side effects, biases, and behavioral consequences that are often not visible to practitioners, and until now, were unexamined by researchers. This study provides an organizational perspective on roadmapping as currently practiced, presents the experience of several organizations that have implemented it, and evaluates the results. Using a case‐based, exploratory method the author addresses several practical questions, such as: What are the effects of roadmapping? How are they measured? Is roadmapping always appropriate? How would an organization know if it was roadmapping well? What are the various kinds of roadmaps and how do they relate to each other? In addition, some more general lessons about organizational behavior emerge from the case data. Cases were selected from several large industrial firms participating in a research consortium exploring the modern challenges and tools of technology management. These firms granted extensive access to the research team and actively participated in the analysis, demonstrating a unique and productive model of research collaboration between academic researchers and business practitioners. Central to an understanding of roadmapping behavior is noticing the tension between its dual nature. Roadmaps are both forecasts of what is possible or likely to happen, as well as plans that articulate a course of action. They are, in a sense, personal to their authors. Roadmaps can be used to align organizations in times of predictable change, but have limited insight into disruptive change. The most influential roadmaps originate as responses to perceived threats, and link the technical storyline to organizational and personal concerns. For those who would implement the technique, the article suggests practical ways to use these and other findings and offers basic definitions and vital questions for future research.     

Not Featherbedding,but Feathering the Nest: Human Resource Management and Investments in Information Technology

This study draws on employment relations and management theory, claiming that certain innovative employment practices and work structures pave the way for organizational innovation, namely investments in information technology (IT). It then finds support for the theory in a cross‐section of UK workplaces. The findings suggest that firms slow to adopt IT realize that their conventional employment model hinders their ability to make optimal use of new technologies. Therefore, the paper advances the literature beyond studies of unionization's impact on business investment to a broader set of issues on the employment relations features that make organizations ripe for innovation.     

An Exploratory Investigation of NPD Practices in Nonprofit Organizations*

Studies of practices in new product and service development have focused predominantly on for‐profit organizations, whereas attention to the nonprofit sector has been minimal. Such attention is needed given that nonprofit organizations are unique in their structures and are growing with regards to impact on the world economy and society in general. Moreover, such disparate attention suggests a void in this discipline's understanding of new product development (NPD) practices of nonprofit organizations. Two particular research questions are posed: (1) To what extent are the practices of for‐profit organizations employed in nonprofit organizations? (2) How do the practices of nonprofits compare to those of for‐profit organizations? In the course of answering these questions, the present study reviewed literature and the Product Development and Management Association (PDMA) certification work. The study subsequently identified six dimensions of successful NPD efforts: strategy, portfolio management, process, market research, people, and metrics and performance measurement. These dimensions were applied via an in‐depth case‐study methodology to six large, U.S. nonprofit organizations: American Association of Retired Persons (AARP), American Cancer Society, American Heart Association, American Red Cross, Boys and Girls Club of America, and Goodwill Industries. The dimensions assisted in categorizing and analyzing the responses of 40 respondents across the six organizations. Results show that some NPD practices of large nonprofit organizations are similar to for‐profit organizations, but other practices are more distinctive and related to the nature of nonprofit organizations. Large nonprofit organizations tend to be very good at articulating their mission, embedding it throughout, and using it to drive programs and activities. These organizations tend to view product development as a tactical endeavor versus a strategic one and do not engage in portfolio management practices for their new programs. Instead, broad criteria such as fit with mission, funding availability, and presence of a champion are used for evaluating programs. The NPD process tends to be informal with little structure, and individual departments and local chapters tend to undertake their own NPD initiatives and have their own process for doing so. Nonprofits place a heavy emphasis on ideation and less emphasis on other activities such as concept development and testing, project evaluation, and business analysis. Pilot testing is the most used type of market research. These results suggest that NPD processes within large nonprofit organizations share some of the same weaknesses as those of for‐profit organizations, with NPD metrics being a particularly weak area. The NPD practices of nonprofits also have some unique characteristics that include the following: a heavy emphasis on the mission, a desire for flexibility, strong influence of external sponsors, and difficulty in assessing long‐term program success. Management of nonprofit NPD and directions for future research are discussed.     

New Product Development in Rapidly Changing Markets: An Exploratory Study

Rapid technological change can be both a blessing and a curse. For example, investors and firms of all sizes hope to reap the rewards that may arise from the apparent convergence of the computer, telecommunications, and entertainment industries. With the high level of uncertainty inherent to such rapidly changing markets, however, those potentially dazzling returns are counterbalanced by a daunting level of risk. John Mullins and Daniel Sutherland suggest that firms operating in such markets require NPD practices that can mitigate risk, manage uncertainty, and, of course, increase the likelihood of new product success. To gain insight into the NPD practices that can meet those challenges, they conducted in-depth interviews with managers who were directly involved in NPD projects at US WEST, Inc., a large, multinational firm in the telecommunications industry. The study focused on identifying practices that help the firm bring new products into rapidly changing markets quickly, efficiently, and effectively. A key objective of their study was to go beyond the basics—for example, the use of cross-functional teams—to identify specific practices that allow the firm to address the various levels of uncertainty that characterize its markets. They identify three levels of uncertainty that confront firms operating in rapidly changing markets. First, potential customers cannot easily articulate needs that a new technology may fulfill. Consequently, NPD managers are uncertain about the market opportunities that a new technology offers. Second, NPD managers are uncertain about how to turn the new technologies into products that meet customer needs. This uncertainty arises, not only from customers' inability to articulate their needs, but also from managers' difficulties in translating technological advancements into product features and benefits. Finally, senior management faces uncertainty about how much capital to invest in pursuit of rapidly changing markets as well as when to invest. The study identifies six practices that help the firm address the uncertainty and risk inherent in its rapidly changing markets. For example, market research in this firm's NPD process focuses more on probing than it does on measuring. Involvement of prospective customers in idea generation and the use of prototypes early in the NPD process help the firm uncover customer needs and market opportunities. Large-scale, quantitative market research focuses primarily on determining market size and price points.     

Success Through Customer-Driven New Product Development: A Comparison of U.S. and New Zealand Small Entrepreneurial High Technology Firms

Although high-tech, entrepreneurial firms may be small in size, they often play a large role in developing innovative products and thus spurring economic growth. Managers from firms of all sizes may gain useful insights by examining the new-product development (NPD) practices of these small, technology-based firms. And in an era of increasingly global competition, those managers can benefit from understanding the NPD practices of firms from various countries. William Souder, David Buisson, and Tony Garrett contribute to that understanding by describing the results of a study that compares the relative NPD proficiency of small, technology-based firms in the United States and New Zealand. The firms participating in the study (26 from the U.S. and 29 from N.Z.) operate in rapidly growing, highly competitive markets characterized by evolving customer needs. The participating companies share similar goals: creating technically superior products with unique features for emerging markets, with the ultimate goal of becoming the product and market leaders within their respective industries. Despite these similarities, the study reveals several important differences between the U.S. and N.Z. participants. Overall, the N.Z. respondents had higher levels of NPD performance than those of their U.S. counterparts. In particular, the relationship marketing and customer-focused NPD practices of the N.Z. firms set them apart from the U.S. firms. Top-level managers from the N.Z. participants report higher levels of satisfaction than their U.S. counterparts with the results of their NPD efforts. The results of the study indicate that repondents from the two countries differ in terms of the focus of their NPD mangement systems and the manner in which they strive to achieve success. For the U.S. firms in the study, their NPD management systems focus on the characteristics of the project manager. The N.Z. respondents place greater emphasis on marketing skills and NPD proficiencies. The results suggest that the higher levels of NPD performance acheived by the N.Z. firms in the study arise from greater insights into their users' needs, together with better capabilities for acting on those insights.     

Salespeople's work toward the institutionalization of social selling practices

While the use of social media has become widespread among business-to-business organizations, the diversity of the social selling practices undertaken by salespeople and the extent to which they rely on them for their sales approach remain limited. Contrary to previous studies that emphasize the benefits of top-down approaches, we adopt a salesperson-centric approach, with the belief that the salesperson's agency is a key factor in the development of new sales practices related to social media. Using the concept of practice work and building upon institutional theory, we argue that social selling practices emerge in a bottom-up way, depending on the work initiated by salespeople. Based on a qualitative study of 32 B2B sales professionals, we show that salespeople perform three kinds of practice work: promotion, reconciliation, and disruption. These efforts can diffuse but also thwart social selling practices in sales organizations. This article offers new insights into how organizations can develop salespeople's depth of social media usage, and encourages firms to support salespeople's social selling initiatives instead of controlling them.     

Firms' open innovation policies,laboratories' external collaborations,and laboratories' R&D performance

The value of the open innovation approach is now widely recognized, and the practice has been extensively researched, but still very little is known about the relative impact of firm‐level and laboratory‐level open innovation policies and practices on R&D performance. This study attempts to measure that impact by analyzing a sample of 203 laboratories of Japanese firms located in Japan. It examines simultaneously the effects of firm‐level open innovation policy and laboratory‐level external collaborations on laboratory R&D performance. The study aims to go beyond a general understanding of the importance of open innovation; it shows how an open innovation policy can have a positive and significant effect on collaborations between a laboratory and local universities or business organizations. The results also show how an open innovation policy can contribute to the laboratory's R&D performance by facilitating external collaborations by the laboratories. It demonstrates how these factors affect R&D performance in different ways, depending on the type of R&D tasks. Our findings suggest several theoretical and practical implications in the field of R&D management.     

Organizing for Radical Innovation: An Exploratory Study of the Structural Aspects of RI Management Systems in Large Established Firms

To escape the intense competition of today's global economy, large established organizations seek growth options beyond conventional new product development that leads to incremental changes in current product lines. Radical innovation (RI) is one such pathway, which results in organically driven growth through the creation of whole new lines of business that bring new to the world performance features to the market and may result in the creation of entirely new markets. Yet success is elusive, as many have experienced and scholars have documented. This article reports results of a three-year, longitudinal study of 12 large established firms that have declared a strategic intent to evolve their RI capabilities. In contrast to other academic research that has analyzed specific projects to understand management practices appropriate for RI, the present research reported explores the evolution of management systems for enabling radical innovation to occur repeatedly in large firms and reports on one aspect of this management system: organizational structures for enabling and nurturing RI. To consider organizational structure as a venue for capability development is new in the management of innovation and dynamic capabilities literatures. Conventional wisdom holds that RIs should be incubated outside the company and assimilated once they have gained traction in the marketplace. Numerous experiments with organizational structures were observed that instead work to manage the interfaces between the RI management system and the mother organization. These structures are described here, and insights are drawn out regarding radical innovation competency requirements, transition challenges, senior leadership mandates, and business-unit ambidexterity. The centerpiece of this research is the explication of the Discovery–Incubation–Acceleration framework, which details three sets of necessary, though not sufficient competencies, for building an RI capability.     

Toward a theory of outside-in marketing: Past,present, and future

Outside-in marketing is a powerful driver of superior firm performance, especially for firms in dynamic, competitive markets. The use and application of outside-in marketing has flourished in the past four decades, but research that synthesizes and extends understanding of this approach is missing, such that extant literature remains fragmented and scarce. This paper aims to deliver a theoretically grounded, managerially relevant framework to guide outside-in marketing research and business practices. Specifically, it offers an integrative conceptualization of outside-in marketing, examines its evolution over the past four decades, and provides business cases that depict how organizations have implemented outside-in marketing. On the basis of a comprehensive analysis of research domains pertinent to outside-in marketing, combined with business examples, this article establishes an evolving theory of outside-in marketing, comprising four key tenets and seven testable propositions.     

Goal Multiplicity and Innovation: How Social and Economic Goals Affect Open Innovation and Innovation Performance

Integrating insights from the strategic goal literature and the knowledge‐based view of the firm, this article proposes that the pursuit of social and economic strategic goals by commercial firms affects their innovation performance through different knowledge sourcing activities. The strategic goals, knowledge sourcing practices, and innovation performance of 1257 Belgian firms are investigated. Results show that both social and economic strategic goals are associated with the use of external information sources, but only the pursuit of social goals inspires firms to engage in external collaboration. No evidence is found of an inherent conflict between social and economic strategic goals. Instead, the two types of goals are independent of each other, that is, an emphasis on social goals does not preclude an emphasis on economic goals and vice versa. Moreover, firms’ external knowledge sourcing and innovation performance benefit most when strongly held social goals align with strongly held economic goals. These findings offer new insight into the nature and the effects of goal multiplicity among commercial firms. They open up a new perspective on the potential positive effects of the joint pursuit of social and economic strategic goals instead of seeing them as inherently conflicting, as past research has typically done. We illustrate how social strategic goals can deliver unique benefits to a firm, independently of and in addition to economic strategic goals. Our findings also contribute to the open innovation literature by revealing strategic goals as a driver of firms’ knowledge sourcing practices. Our findings suggest that solely emphasizing economic goals may be one reason why firms struggle to implement open innovation practices and do not reap their full benefits. The practical implications of our research are discussed.     

How organizations promote person-environment fit: using the case of japanese firms to illustrate institutional and cultural influences

The majority of person-environment (P-E) fit studies have been conducted in the Western context and little is known about the process through which organizations promote P-E fit. In this paper, I illustrate how Japanese organizations promote multiple types of P-E fit through their human resource practices. I also develop conceptual models in which promoting P-E fit in Japanese firms is contrasted with that of U.S. firms. The case and models suggest that institutional and cultural contexts affect the way organizations promote P-E fit. Future research directions for a better understanding of P-E fit management especially in the Asia-Pacific region are discussed.     

Changing Strategies and Tactics for New Product Development

There has been a considerable amount of effort and writing devoted to improving the new product development process during the last two decades. Although there have been some surprises in this literature and in reports from the field on how to manage this complex business process, we now have a good view of the state-of-the-art practices that work and do not work to accelerate commercial success of new ventures. We know much less about how firms change their strategies for new product development.
In this article, we report on a study to investigate how companies change the way they originate and develop new products in manufacturing. We made no prior assumptions about what best practices might be for changing the direction of the new product development process, but we reasonably were sure there would be trends in how companies were attempting to create this strategic change. Even though one size does not fit all, there were significant trends in our findings.
We studied eight manufacturing firms using in-depth, open-ended interviews and were surprised to find that most of these companies are beginning to develop products that are new to the firm, industry, and the world (nearly half, or 10 of 21 new product projects), where they had not been eager for radical change in the past. These newer products likely are to be driven by a combination of market and technology forces, with general requirements being directed by internal forces: middle and top management. Results also indicate significantly that being able to marshal resources and capabilities is easier if change is less demanding and less radical, but when middle managers are driving the conversion of general requirements into specifications, resource issues have yet to be resolved. Implications of these findings are discussed for companies aspiring to change the entire process of new product development in their firms based on these significant results.     

Value creation in university‐firm research collaborations: A matching approach

University‐based technological opportunities are often exploited through joint corporate and academic entrepreneurship activities such as university–industry research collaborations. This paper explores the partner attributes that drive the matching of academic scientists and firms involved in these relationships. The paper models the formation of firm–faculty partnership as an endogenous selection process driven by synergy between partners' knowledge‐creation capabilities. The main findings indicate that faculty–firm matching is multidimensional: firms and scientists complement each other in publishing capabilities but substitute each other in patenting skills. Furthermore, firms and scientists with specialized knowledge create more value by teaming with more knowledge‐diversified partners. The paper contributes to the literature on university–industry knowledge transfer and, more generally, to the literature on alliance formation.