A Model of New Product Development: An Empirical Test

Abstract

This paper reports on the culmination of a four year study of high technology product innovation. During the course of this research, we examined over 330 new products in the electronics industry in order to better understand the factors that differentiated successful from unsuccessful product development efforts. This paper presents the conclusions from the final phase of the research. In this study we empirically test a model of product development that incorporates our findings from the earlier exploratory survey and case study phases of our research. The model identifies the critical organizational subunits, development activities and communication channels that influence product outcome, as well as, external factors such as characteristics of the product and the competitive environment. Our findings suggest the following key factors affect product outcome: (1) the quality of the R&D organization, (2) the technical performance of the product, (3) the product's value to the customer, (4) the synergy of the new product with the firm's existing competences, and (5) management support during the product development and introduction processes. Also important but less significant were the (6) competence of the marketing and manufacturing organizations and market factors, such as the (7) competitiveness and the (8) size and rate of growth of the target market.