Firm Characteristics and NPD Program Success: The Significant Influence of Global Discovery Management

Managing new product development (NPD) with a global point of view is argued to be essential in current business more than ever. Accordingly, many firms are trying to revitalize their NPD processes to make them more global. Therefore, examining global NPD management is one of the top priorities for research. While scholars have examined global launch management, there has been scant attention on the direct effect of global discovery management on NPD success. Therefore, this study investigates how a globally managed discovery phase enhances a firm's overall NPD success. Drawing upon the resource‐based view (RBV) and using Kotabe's ( 1990 ) generic model for market success in global competition as the overarching framework, this study examines four drivers of NPD success: global discovery management, the firm's “global footprint,” its inbound knowledge sourcing practices (i.e., “open innovation proclivity”), and nationality of the teams (i.e., “cross‐national global NPD team use”). The hypotheses are tested using a sample of 255 business units from multiple industries, headquartered worldwide, and surveyed during the 2012 PDMA Comparative Performance Assessment Study (CPAS). The PLM‐SEM analyses show that, of the four drivers examined, only global discovery management strongly influences a firm's NPD program success. The findings enhance our understanding of the particularities in global NPD. Based on the study's results, suggestions are provided as to how multinationals can leverage their international operations in the course of their front‐end activities.     

Information Technology Tools in New Product Development: The Impact of Complementary Resources*,†

Emergent research has examined the antecedents to using information technology (IT) in the new product development (NPD) process and the impact of IT on NPD performance. Based on the resource‐based view (RBV) of the firm, this study hypothesizes that particular resources create IT capabilities that significantly enhance NPD outcomes. More specifically, this research extends previous work by investigating whether three complementary resources, namely an executive champion for IT, global engagement, and organizational innovativeness, influence IT capabilities (IT use frequency and IT replacement frequency), which in turn affect NPD outcomes (NPD task proficiency and NPD performance). To test the conceptual model, survey data were collected from 220 NPD and IT managers in a variety of large Japanese firms. The results show that an executive champion for IT and global engagement are predictors of both IT tool use and replacement frequency while organizational innovativeness contributes only to IT tool replacement frequency. The results also indicate that both IT tool use and replacement frequency have a positive effect on NPD task proficiency, which improves NPD performance. This research contributes to the literature by adding understanding of the role of IT in NPD at the firm level in four ways. First, it examines particular organizational complementary resources and their relationship to IT capabilities. Second, it examines the RBV and IT in the context of NPD, an important business process. Third, it measures IT usage in a more granular fashion (i.e., IT tool use frequency and IT replacement frequency) rather than simply IT usage as a dichotomy. Finally, through testing the proposed model with data collected from Japanese firms, this study provides empirical evidence from an Asian country to answer the call for more NPD research to be conducted in countries other than North American and Western European contexts. The findings of the study also provide implications for managers. Importantly, they indicate that an executive level champion for IT is a key influencer in facilitating IT usage and replacement, and likely can help generate awareness of and support for greater IT investments so the firm can create IT capabilities for effective NPD.     

The Sustainability of Current Account Deficits and Tourism Receipts in Turkey

Current Account Deficits (CAD) in Turkey have reached significantly high levels in the recent years and discussions around the sustainability of these deficits continue. On the other hand, thanks to its rapid development within the same period, the tourism sector is observed to increase its positive contribution to the current accounts balances. This study is an initiative to highlight the contribution of the tourism sector to the sustainability of the CAD in Turkey. Unit root and Cointegration tests have been used to this end. This approach is applied to the long-run relationship between Exports + Tourism Receipts (X + TR) and Imports + Tourism Expenditures (M + TE) for the period of 1980Q1–2005Q2. We question the weak sustainability hypothesis where the cointegrating vector is (X + TR)_t = a + b(M + TE)_t + η _t . In this vector, if b equals to one and η_t is stationary, then the current account deficits are strongly sustainable, if b is between 0 and 1(0 < b < 1) and η_t is stationary or b = 1 but η_t is non-stationary, then the current account deficits are weakly sustainable and lastly, if there is no cointegration or b = 0, then the current account deficits are unsustainable. The empirical results indicate that CAD in Turkey are unsustainable in spite of the rising shares of tourism receipts in current account balances. Therefore, in Turkey, where exports are exceedingly depended on imports, which makes it not very easy to reduce imports, the only way to ensure that CAD are sustainable is to seek options to further increase the tourism receipts.     

Your new product development (NPD) is only as good as your process: an exploratory analysis of new NPD process design and implementation

Given industry competitiveness, how do firms' new product development (NPD) process designs differ when responding to an innovation mandate? How do NPD design elements differ across firms when implementing NPD processes? These design elements are strategic business unit (SBU) senior management involvement, business case content, customer interactions, and cross‐functional integration. What are the consequences of different combinations of NPD process design elements for innovation productivity? We explore these questions via a collective case study of newly implemented NPD process designs at three different SBUs of a major US‐based international conglomerate, 1 year after receiving the mandate to grow through innovation. Our analysis suggests that industry competitiveness and firm characteristics influence the NPD process design as SBUs employ distinct combinations of NPD design elements. The differential emphasis on design elements leads to variation in process design and divergence in innovation productivity.     

How category characteristics affect the number of store brands offered by the retailer: a model and empirical analysis

Our research examines why retailers offer, not one, but multiple store brands in some product categories. More specifically, we are interested in how certain product category characteristics affect the number of store brands. We model a product category consisting of two incumbent national brands that may differ in strength. The retailer may introduce one or two store brands depending on which maximizes category profits. Our analysis suggests that the retailer is likely to carry two store brands in categories where (i) the national brands are similar in strength; and (ii) the price sensitivity between the national brands is low. Interestingly, the conditions that support the introduction of more than one store brand are quite different than the conditions that would facilitate the introduction of additional national brands. We provide empirical evidence that support our model-based predictions.     

On the persistence of income shocks over the life cycle: Evidence,theory, and implications

How does the persistence of earnings change over the life cycle? Do workers at different ages face the same variance of idiosyncratic earnings shocks? This paper proposes a novel specification for residual earnings that allows for an age profile in the persistence and variance of labor income shocks. We show that the statistical model is identified, and we estimate it using Panel Study of Income Dynamics data. We find that shocks to earnings are only moderately persistent (around 0.75) for young workers. Persistence rises with age, up to unity, until midway through life. The variance of persistent shocks exhibits a U-shaped profile over the life cycle (with a minimum of 0.01 and a maximum of 0.05). These results suggest that the standard specification in the literature (with age-invariant persistence and variance) cannot capture the earnings dynamics of young workers. We also argue that a calibrated job turnover model can account for these nonflat profiles. The key idea is that workers sort into better jobs and settle down as they age; in turn, magnitudes of wage growth rates decline, thereby decreasing the variance of shocks. Furthermore, the decline in job mobility results in higher persistence. Finally, we investigate the implications of age profiles for consumption–savings behavior. The welfare cost of idiosyncratic risk implied by the age-dependent income process is up to 1.6 percent of lifetime consumption lower compared with its age-invariant counterpart. This difference is mostly due to a higher degree of consumption insurance for young workers, for whom persistence is moderate. These results suggest that age profiles of persistence and variances should be taken into account when calibrating life-cycle models.     

Price discrimination through multi-level loyalty programs

Loyalty programs often feature multiple rewards with different requirements; for instance, an airline offering a free domestic ticket for 10 K miles, and an international ticket for 20 K miles. This research focuses on the role of multi-level rewards as a segmentation and price discrimination mechanism: Multi-level rewards can increase firm profits when buyers differ in purchase frequency and/or time discount factor. We propose that a program with two rewards can be designed in such a way that (i) it is more profitable than a one-reward program, and (ii) buyers self-select. Light users prefer to receive the smaller reward two times over receiving the larger reward one time, even though the smaller reward is less than half of the larger reward. We show that the smaller reward helps the firm enlarge its base in the light user segment. We also compare multi-level programs with quantity discounts.     

Exploring new product portfolio management decisions: The role of managers' dispositional traits

Product strategy links to new product development (NPD) through new product portfolio management (NPPM). This dynamic decision process addresses the strategy implementation questions of identifying which new product ideas to pursue and their relative priorities. Despite the importance of NPPM in implementing product strategy, firms exhibit substantial performance-affecting differences. We investigate one potential source for such differences by examining the impact of managers' dispositional factors as a possible explanation. Using a case study research method, we examine differences in NPPM strategies and managers' revealed dispositional traits across three divisions of a single conglomerate firm operating in different business-to-business markets. Based on our analysis, we offer propositions relating managers' dispositions to NPPM strategy: analytic cognitive style is associated with balance, ambiguity tolerance is associated with strategic fit, and leadership style is associated with the relative weights applied to each dimension.     

Achieving environmental sustainability through green transformational leadership policy: Can green team resilience help?

The race to gain competitive advantage through the formulation of a sustainable business strategy is key for the survival in the global business sphere. Even more importantly is the quest to deploy an effective green strategy to combat the numerous negative impact industrialization has on the environment. Researches pointed out the role of leaders and stakeholder's engagement in bringing about reform. This research focuses on how to build a robust psychological capital within an organization through the leader's transformative ability in combating environmental issues. This is necessary because research related to green transformational leadership and the effect on green team resilience has not been considered in literature. Drawing from the combination of three theories; broaden-and-build theory, job demand–resource theory, and conservation of resource theory, this study contributes to the extant literature by testing the effect of green transformational leadership via the mediating role of green work engagement to green team resilience. Using Amos 20 version to analyze 351 questionnaires that were collected from employees in four and five star hotels in Turkey, the result reviews that green transformational leadership has a positive effect on green work engagement and green team resilience, and green work engagement fully mediates the relationship between the variables. The theoretical and practical implications are discussed.