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| The Driving Mechanism of Customer and Supplier Participation on New Product Development Performance：The Perspective of Open Innovation Theory |
| Dong Weiwei,He Ruidan,Qin Jian |
| (School of Economic and Management, Shanghai Institute of Technology, Shanghai 201418,China) |
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Abstract As the digital economy has developed rapidly and undergone profound changes, the business environment is characterized by the shortening of product life cycles and the continuous acceleration of technology updates, making independent research and development (R&D) costs increasingly expensive. Therefore, more and more firms are actively opening organizational boundaries and cooperating with external organizations. Consumers and suppliers are regarded as two significant sources of innovation and they are increasingly involved in firms' product development activities, affecting the performance of new product development (NPD), and product line synergy. Product line synergy and NPD performance will affect the speed of new product launches, the purchase intentions of consumers, and finally the market performance of firms. Therefore, against the background of open innovation, it is necessary to explore the impact mechanism of consumer and supplier participation on NPD performance and product line synergy.#br# However, there is no consensus on the relationship between consumer participation and NPD performance or the relationship between supplier participation and NPD performance in the existing literature. With regards to the impact of consumer participation on NPD performance, some scholars believe that consumer participation has a positive effect on NPD performance;some think otherwise, and some scholars believe that there is a nonlinear relationship between them, that is, an inverted U-shaped relationship. In terms of the impact of supplier participation on NPD performance, some scholars believe that supplier participation can improve NPD performance, while others do not. Moreover, the impact of consumer and supplier participation on the competitive advantage of firms has been analyzed by many scholars, but the joint impact of consumer and supplier participation on NPD performance has been rarely touched.#br#Following the resource-based view and the related theory of open innovation, this paper constructs the related model. It collects 227 valid questionnaires from regions with relatively developed manufacturing industries. SPSS 22.0 is used to test the reliability and validity of the variables and multiple regression analysis is carried out on the questionnaire data. AMOS 20.0 is employed in confirmatory factor analysis and path analysis of the model.#br#It is found that first, consumer participation has a positive impact on NPD performance and product line synergy of Chinese manufacturing firms. Consumer participation in NPD activities keeps manufacturers informed about the latest market demand, reduces information asymmetry, arranges product lines in advance, realizes product line synergy and then improves channel efficiency;Consumer participation can enable firms to find potential problems in new product R&D as early as possible, speed up the launch of new products, and then increase NPD performance. Second, supplier participation has a negative effect on NPD performance and product line synergy of manufacturing firms. Different from consumer participation, suppliers, as an independent legal entity, must obtain corresponding commercial benefits, and absorbing supplier participation represents specific investment, which will bring lock-in effect and path dependence effect to manufacturers to a certain extent. Thus, manufacturers can only fix the existing product line and cannot realize product line synergy, nor can they reduce the strategic flexibility and performance of NPD. When supplier participation in NPD lacks support from a sound governance mechanism, the suppliers may have free-riding behavior, and the manufacturers have to suffer the infringement on the core technology and the patent protection. Finally, product line synergy and NPD performance have a positive impact on the acquisition of enterprise market performance, for they ensure that firms can launch new products faster than competitors, gain advantages in terms of time, technology, and industry standards, and achieve higher market share.#br#In order to provide enlightenment for firms to carry out open innovation practice, this paper puts forward some suggestions as follows: for Chinese manufacturing firms, they should actively cooperate with consumers to obtain valuable information on market and demand,actively adjust the R&D of new products to meet market requirements, and then enhance their own new product R&D strength. Second, firms should be careful to cooperate with suppliers to avoid free-riding behavior when acquiring and utilizing external resources in the NPD process.#br#
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Received: 29 November 2022
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