1. Group #6 Session 4 Henard & Szymanski (2011) Why Some New Products Are More Successful Than Others PREDICTORS OF NEW PRODUCT SUCCESS Review and suggestions for future research Jamal Armel Alexey Malkov Oriol Sementé Katariina Silander

2. Let’s assume that you are a company manager and that your read this article. What else would you like to know about predictors of new product success? What would be your recommendations for future research? Assignment Question:

3. Highlights Overview: What was done in the article Identification of predictors and their grouping Identification of most important predictors Moderator Variables and its implications What have we learned from all this and As Managers: What would we want to know more? Recommendations for future research

4. What was actually done in the article META-ANALYSIS OF NEW PRODUCT PERFORMANCE STUDIES Keyword searches of electronic databases + manual searches of most important journals 41 articles chosen Identification of predictor variables related to new product performance Analysis of individual predictors → how do they affect new product performance e.g. ”product innovation”, ”newproducts ” 24 predictor variables identified + grouped Had strong enough correlation Analysis of many predictors at the same time (multivariate regression model)→ how do they affect new product performance Identified significant drivers + dominant drivers ANOVA- analysis: how did the predictors affect new product performance (depending on how certain concepts were measured) e.g. Asia vs America, short- term vs long-term performance

5. Predictors and Analysis Keyword searches of electronic databases + manual searches of most important journals 41 articles chosen Identification of predictor variables related to new product performance Analysis of individual predictors → how do they affect new product performance e.g. ”product innovation”, ”newproducts ” 24 predictor variables identified + grouped Had strong enough correlation Analysis of many predictors at the same time (multivariate regression model)→ how do they affect new product performance Identified significant drivers + dominant drivers ANOVA- analysis: how did the predictors affect new product performance (depending on how certain concepts were measured) e.g. Asia vs America, short- term vs long-term performance

6. ProductFirm StrategyFirm ProcessMarketplace Categories of Predictors Advantage Meeting customer needs Price Technological sophistication Innovativeness Marketing synergy Technological synergy Order of entry Dedicated human resources Dedicated R&D resources Structured approach Predevelopment task proficiency Likelihood of competitive response Marketing task proficiency Technological proficiency Launch proficiency Reduced cycle time Market orientation Customer input Cross-functional integration Cross-functional communication Senior management support Competitive response intensity Market potential

7. ProductFirm StrategyFirm ProcessMarketplace Dominant Predictors Advantage Meeting customer needs Price Technological sophistication Innovativeness Marketing synergy Technological synergy Order of entry Dedicated human resources Dedicated R&D resources Structured approach Predevelopment task proficiency Likelihood of competitive response Marketing task proficiency Technological proficiency Launch proficiency Reduced cycle time Market orientation Customer input Cross-functional integration Cross-functional communication Senior management support Competitive response intensity Market potential

8. Dominant Predictors of New Product Performance

9. Moderator Variables Measurement and Contextual Effects Contextual Effects  Service vs Goods  Asia vs North America  High-tech vs Low-tech Measurement Effects  Multi vs Single-Item Measurement  Subjective vs Objective Criteria  Senior vs Project Management  Short-terms vs Long-term Performance

10. Moderator Variables Measurement and Contextual Effects Managers should go in-depth research according to their company’s context!

11. Measurement Effects and Implications (I) Multi vs Single-Item Measurement (ROI, share, sales) → Multi-item measurement claimed to be more reliable and accurate → Multi-item measurement ensure a common reference for decision-making Subjective vs Objective Criteria → Objective performance data yield stronger relationships with selected Process characteristics → Subjective assessments likely to reflect biases and imperfect information Short-term vs Long-term Performance ( 36 months) → Effects of being first to the market with a new offering are evidenced more fully when considerable time has elapsed since product introduction. (Product Diffusion)

12. Managers’ Perception Selective Attention Perceptual Screens Personal Biases Collective Blindness Tunnel vision Functional fixednessStrategic Myopia Contested Belief structures Senior Manager vs Project Manager → PM perceive the support they receive from SM as more vital to the success of new product introductions than do the SM responsible for providing this support. Measurement Effects and Implications (II)

13. Marketing synergies greater in services than in goods → communicate more the characteristic intangibles of the services, capitalize on brand name recognition, other service offerings. Less structure → positive effect on success levels achieved by new services Services Vs. Goods Contextual Effects and Implications (I) ServicesGoods  More intangible  Less consistent  Less separable in production and consumption  More perishable  More tangible  More consistent  Separable in production and consumption  Less perishable

14. Contextual Effects and Implications (II) Asian Vs. North American markets AsiaNorth America  Greater performance of technological sophistication  Greater marketing synergies  Greater market orientation  Greater senior management support  Less performance of technological sophistication  Less marketing synergies  Less market orientation  Less senior management support Producing and selling new offerings is not the same across Asia and North America Successful performance in Asian markets accrues to firms that display more marketing savvy and top management support

15. Contextual Effects and Implications (III) High-tech markets Vs. Low-tech markets High-tech marketsLow-tech markets  More complex  Information intensive  Turbulent  Uncertain  Based on scientific & technical know-how  More structured  Less complex  Less information intensive  Less Turbulent  Somewhat predictable  Less based on scientific & technical know-how  Less structured Less structure is important to the success of new products in markets that are more turbulent and more uncertain because of heterogeneous and rapidly changing technologies.

16. How the following affect product performance and how could they be enhanced? More information of the following and their alignment together How delaying product entry, having less structure and more personnel and selling more products should be aligned to increase product performance Why are these important? Are there other aspects that should be taken into account? International context What product facets and organizational dimensions and strategies should be adapted and when should this be done to optimize product performance? The article gives some insight to Asia vs North America, technological sophistication, market orientation and synergies and senior-level support. We would like to know more of the real implementation of adaptation. What does it really mean? What should we take into account? What is the right timespan to measure new innovation product performance? Product Diffusion Theory. NPD Team composition for maximizing new product success. Impact of Interdisciplinarity As Managers: What would we want to know more?

17. Recommendations for future research More knowledge on how product quality affects product performance How new ideas in firms are translated into new products Are there essential steps in the process that can be identified? What kind of organizational issues (e.g. discourse, dialogue, networking) support product innovation Are companies with these traits more successful in creating new innovations with higher product performance? The roles of different employees in innovations with higher product performance (e.g.) senior managers vs project managers top management vs middle management engineers vs marketing More specific industry studies meaning what attributes affect product performance in certain industries

18. Thanks for your attention!