Full citation

Balachandra, R., Friar, J.H. (1997). Factors for Success in R&D Projects and New Product Innovation: A Contextual Framework. IEEE Transactions on Engineering Management, 44(3), 276-287.

Format: Peer-reviewed article

Type: Research — Non-experimental

Experience level of reader: Fundamental

Annotation: A literature review of about 60 articles on key success factors in NPD shows a lack of agreement, which the authors resolve by presenting a contingency theory based on three context variables with two dimensions each: 1) Nature of Innovation (incremental vs. radical); 2) Nature of Market (existing vs. new); 3) Nature of Technology (high vs. low).

Setting(s) to which the reported activities/findings are relevant: Large business, Small business (less than 500 employees), University

Knowledge user(s) to whom the piece of literature may be relevant: Manufacturers

Knowledge user level addressed by the literature: Organization

This article uses the Commercial Devices and Services version of the NtK Model

Primary Findings

Primary Model:

The literature base does not agree on the key success factors underlying NPD. The differences may be accounted for by three contingencies that any NPD project should consider in its planning process: 1) Nature of the Innovation - being either an incremental change to an existing product or a radical departure from existing products/technologies; 2) Nature of the Market - being either familiar with low market uncertainty or unfamiliar with high market uncertainty. 3) Nature of the Technology - being either low tech, mature and stable, or high tech with a rapidly changing base. Each combination of conditions results in a different set of critical success factors to be considered.
Literature review (n = 60) and ensuing analysis.

Secondary Findings

Secondary Model:

A literature review found two differences between studies of the early R&D Stages (3,4,5) and the later NPD Stages (6,7,8): First the R&D project studies cited a larger number of factors listed as critical to success, than did the NPD projects. Second, studies with a marketing orientation put more emphasis on internal organizational factors (e.g., launch & marketing) as critical, while studies with a technical orientation put more emphasis on external environmental and market factors as critical. (Calantone & di Benedetto [1988])
Occurrence of finding within the model: Stage 3, Stage 4, Stage 5, Stage 6, Stage 7, Stage 8

Secondary Tips:

  • The expected growth rate of the market for the product is an important factor for the decision to pursue the new product. (Merrifield [1981])
    Occurrence of finding within the model: Step 4.11
  • There is universal agreement that there should be a strong market for a new product under consideration or for the outcome of an R&D project. (Rothwell et all, [1974])
    Occurrence of finding within the model: Step 2.2, Step 1.2
  • New products should meet customer needs/wants and there should be a good understanding of the market. (Gaynor [1990])
    Occurrence of finding within the model: Step 2.1, Step 2.1