Nachiappan Subramanian Role of Traditional Chinese Philosophies and New Product Development under Circular Economy Considerations on Performance: Empirical Evidence from Chinese Private Manufacturing Enterprises Lin WU Lecturer in Business Management Nachiappan Subramanian Tinghua Shen Angappa Gunasekaran SBC Second Annual Conference and Learning and Teaching Forum 26th October, 2017 SBC Campus, Shanghai During the next 20 minutes, I am going to briefly talk about one of my research papers, and discuss how it can be applied in the context of teaching and learning to better fit it into our conference. The title of the paper is … It has been submitted to the International Journal of Production Research, and it is under the first round of revision. We will resubmit it soon. These are my coauthors.

Agenda Motivation Literature review Research gap Research questions Research framework Methodology Results Contributions Limitations Teaching and learning My presentation will cover the motivation…

Motivation New product development (NPD) has significant impact on business performance. The concept of Circular Economy (CE) is becoming increasingly popular since the 1970s. Product design based on the right cultural values plays a pivotal role in realizing the desired effect of CE. Chinese society has been profoundly influenced by the traditional philosophies of Confucianism and Taoism. Start from motivation. Why is this topic worth studying? The importance of NPD has been extensively studied so far. If we look at Apple, its huge success comes from its continuous upgrading of products. We all know that the new Iphone 8 with various new features and functions has just been released. Also in academic research, the positive effect of NPD on business performance has been widely proven. However, the current NPD is different from traditional NPD. Recently, the concept of CE is becoming increasingly popular in China. A CE basically means an economy in which all forms of waste are eliminated by making material flow a closed loop. I will explain it in greater details later. Under this condition, NPD should take CE into consideration at the very beginning of product design. If these sustainability considerations are incorporated, the cost of NPD will inevitably increase. Its effect on business performance becomes unclear to us. That is the primary reason for us to study this topic. So what factors could influence the effect of NPD with CE considerations on performance? From literature we know that philosophies, or cultural values play a role. In the Chinese context, there are two traditional philosophies basically influencing every aspect of people’s life, Confucianism and Taoism. I will talk about them in more details later. So these are the motivations for us to examine this particular topic.

Literature review CE and NPD A CE is defined as “a regenerative system in which resource input and waste, emissions, and energy leakage are minimized by slowing, closing, and narrowing material and energy loops” (Geissdoerfer et al., 2017). “At the enterprise level, CE practices encompass environmental protection requirements on reduction, reuse, and recycling (3Rs) with an emphasis on achieving the dual environmental and economic performance goals” (Zhu et al., 2010). Literature review. A CE is defined as… At the enterprise level… NPD with CE or sustainability considerations is the trend. To achieve the goal of CE, companies need to make efforts to incorporate reduction, reuse and recycling considerations in NPD process. NPD with CE considerations is good for the society and the natural environment without any doubts. However, its effect on the business performance becomes less clear because cost will be increased.

Literature review NPD process (ideation & commercialization) and performance (time-to-market & profit) The traditional stage-gate NPD model (Cooper, 1984) The more recent concurrent model Time-to-market Profit The Knowledge-based View (KBV) of the firm VRIN resources and competitive advantage What does NPD mean then? The traditional view tends to see NPD process as consisting a series of stages. According to Cooper, there are five stages in the NPD process, scoping, building a business case, development, testing and validation, as well as launching. It is a stage-gate model of NPD, which means these stages happen in sequence, one after another. More recent NPD builds on concurrent engineering, which means different are activities done simultaneously. This new trend is driven by the increasing competition in the marketplace. Higher speed and efficiency is crucial to business success. In this study our focus is not on the sequence of activities. We look at two crucial set of activities in NPD, ideation and commercialization. Ideation refers to idea generation on developing new products. By commercialization we mean the introduction of new products to the marketplace. In terms of NPD performance, there are two major measures. The first is TTM, which is defined as the period from design to marketing. The second is profit, which is a direct measure of financial performance of new products. The theoretical basis for this study is the KBV. KBV was developed from RBV. Knowledge is a typical VRIN resource. Ideation and commercialization are knowledge-intensive activities. Successful ideation and commercialization requires firms to constantly enhance their learning and knowledge base.

Literature review Traditional Chinese philosophies Confucianism (hierarchy; collectivism; Guanxi) Taoism (freedom; individual talent and creativeness; human-nature harmony) The Chinese society is profoundly influenced by the traditional philosophy of Confucianism and Taoism. These two philosophies are so broad that they cover every aspect of people’s life in China and the Eastern world. In this study we only look at some key relevant attributes in each philosophy. Confucianism emphasizes hierarchy in collective working and signals the importance of the role of leader. Absolute obedience is needed. On the other hand, it stresses the importance of group and collectivism. It focuses on the good of the group. When individual interest and the common good conflict, individual should go with the interest of the group. In this context, Guanxi is established based on common interest. Taoism, on the other hand, advocates individual freedom, Xiaoyao in Chinese. It means that people should take ownership of their own action, and be passionate in what they do, irrespective of others’ comments. Taoism recognizes individual talent and creativity. It also emphasizes the human-nature harmony. Our study focuses on these attributes due to their high relevance.

Research gap NPD & performance? YES NPD with CE considerations & performance? NO The role of philosophies? NO Literature review suggests some research gaps. As I said earlier, NPD and its impact on business performance has been widely examined. However, the new trend of NPD cauterized by CE features has not been studied. Moreover, influencing factors from a cultural perspective have not been systematically studied. Our research is trying to bridge these gaps.

What is the impact of NPD with CE considerations on performance? Research questions What is the impact of NPD with CE considerations on performance? How is the impact affected by Traditional Chinese philosophies? Research questions

NPD with CE Performance Research framework Philosophies The overall research model is this one. Dependent variable… Independent variable… We proposed that philosophies act as a moderator in this link.

TTM NPD with CE Profit Research framework Confucianism Taoism Specifically, we want to examine the…

Hypotheses H1: NPD efforts with CE considerations has a positive effect on TTM. H2: NPD efforts with CE considerations has a positive effect on profit. H3: The positive moderating effect of Chinese traditional philosophies on the NPD – TTM link is greater than Confucianism or Taoism alone. H4: The positive moderating effect of Chinese traditional philosophies on the NPD – profit link is greater than Confucianism or Taoism alone.

Data collection: survey Sample: 130 responses Methodology Quantitative Data collection: survey Sample: 130 responses Data analysis: PLS-SEM (SmartPLS 2.0) This is a quantitative study. Data were collected from a survey. We obtained 130 responses from Chinese private enterprises. Data was analysed by PLSSEM using the application SmartPLS version 2.0.

Results

Results

Theoretical Practical Contributions NPD with CE considerations and performance Role of Chinese traditional philosophies in the NPD process-performance link Practical The findings provide insights for Chinese private enterprises on the establishment of a favourable environment for NPD

Limitations Small sample size Single region Limited attributes of philosophies

The study in the context of teaching and learning Teaching can be viewed as a NPD process Students academic performance and job prospects are measures of the effectiveness of teaching The role of cultural values

Thank you very much!