New product development 329
in at an early stage. Similarly, Intel’s develop-
ment of Pentium departed from its traditional
models of development and involved both
major customers and software suppliers in the
design of the new product.
These shortcomings emphasize that the
management of the NPD process is more than
simply the number and sequencing of its activ-
ities. The extent to which the activities can or
cannot be effectively carried out demands atten-
tion to the people, or functions, within the process.
It is to these issues that we now turn our
attention.
People involved in the NPD process and the
way in which these people are organized are
critical factors in the outcome of new product
developments. In order to combine technical
and marketing expertise, a number of company
functions have to be involved: R&D, manufac-
turing, engineering, marketing and sales. As the
development of a new product may be the only
purpose for which these people meet profes-
sionally, it is important that the NPD process
adopted ensures that they work well and effec-
tively together. Linked to this is also the need for
the voice of the customer to be heard, as well as
that of suppliers, where changes to supply may
be required or advantageous.
The Stanford Innovation Project (Maidique
and Zirger, 1984) identified functional co-ordi-
nation as a critical factor contributing to the
development of successful new products.
Support for the importance of functional co-
ordination is to be found in numerous studies,
including Pinto and Pinto (1990), who found
that the higher the level of cross-functional co-
operation, the more successful the outcome of
NPD. The benefits of a close relationship
between functional co-ordination and an inte-
grated set of NPD activities have already been
highlighted, including the reduction of the
development cycle time, cost savings and closer
communication, so that potential problems are
detected very early on in the process (Larson,
1988). Although integration of all the relevant
functional specialisms into the NPD process is
necessary, one particular interface has been
given more attention in research studies: the
R&D/marketing interface, due to the impact of
this interface on the success with which a tech-
nological development can be made to match
customer need.
Although a host of issues pertain to the inte-
gration of the R&D and marketing functions,
one of the most powerful is that of how informa-
tion is handled throughout the NPD process.Information
The role which information can play in facili-
tating an efficient NPD processand achieving
functional co-ordination is implicit in the lit-
erature on success in NPD. The notion of
reducing uncertainty as the main objective of
the project development activities is reiterated
throughout the literature: project activities ‘can
be considered as discrete information processing
activities aimed at reducing uncertainty ...’
(Monaert and Souder, 1990, p. 92). These
activities include gathering and disseminating
information and making decisions based upon
this information, which must include evalu-
ations of both the market and technical aspectsof
the development project. Indeed, it is ulti-
mately this information which is evaluated
during the NPD process review through the
‘gates’.
In order to reduce uncertainty, it is not
sufficient that information be processed, it also
has to be transferred between different func-
tions (Monaert and Souder, 1990). In this way,
the uncertainty perceived by particular func-
tions can be reduced. At the same time, the
efficient transfer of quality information
between different functions encourages their
co-ordination (Monaert and Souder, 1990).
As well as reducing uncertainty, the trans-
fer of information between the two functions is
perceived by both sides to be a key area for
establishingcredibilityas a necessary input to
the integration described in the previous sec-
tion. The research by Workman (1993) showed,
for example, that in Zytech, lack of credibility
between functions inhibited integration.