Can Quality‐Oriented Firms Develop Innovative New Products?

Abstract

Research suggests that a strong focus on quality improvement can adversely affect exploration and thus the development of innovative new products. The focus on quality improvement including total quality management (TQM) has been termed quality orientation. The literature suggests that one way to reduce the adverse effect of a quality orientation on innovativeness is to adopt ambidextrous or dual organizational forms. However, dual organizational forms are cumbersome and expensive to implement. This paper argues that a less demanding structural arrangement for developing innovative products in quality-oriented organizations involves the creation of cross-functional teams that are explicitly encouraged to take risk and granted autonomy. In this model, the two dimensions of innovativeness-namely, novelty and appropriateness-are treated separately because quality orientation and encouragement to take risk can have differential effects on these two dimensions. A survey of 141 new product development projects reveals that quality orientation does not adversely affect product novelty in cross-functional product development teams. However, encouragement given to cross-functional teams to take risk leads to more novel products. On the other hand, while a quality orientation improves product appropriateness, encouragement to take risk affects it adversely. Quality orientation is able to mitigate the adverse effect of encouragement to take risk on appropriateness. But encouragement to take risk does not influence the relationship between a quality orientation and novelty. Autonomy improves the positive effect of encouragement to take risk on new product novelty but does not influence the effect of a quality orientation on novelty. Both novelty and appropriateness enhance a new product's performance, and both these dimensions of innovativeness partially mediate the effect of quality orientation and fully mediate the effect of encouragement to take risk on new product performance.

Product competence exploitation and exploration strategies: The impact on new product performance through quality and innovativeness

“…In this case, the emphasis is on efficiency and quality improvement, which enable the firm to utilize its resources more effectively (Benner & Tushman, 2003;Voss et al, 2008). As such, a focus on exploitation is related to process improvement initiatives and quality orientation (Sethi & Sethi, 2009). Moreover, it leads to further reliable processes, which in turn allow companies to look for greater efficiency, even in innovation development.…”

“…Some researchers argue they are mutually exclusive (Voss, Sirdeshmukh, & Voss, 2008). Moreover, the exploitation of existing competences tends to yield more immediate and certain returns compared to exploring new ones (Sethi & Sethi, 2009). Despite Industrial Marketing Management 40 (2011) 1172-1182 2.…”

The Transformative Role of Bimodal IT in an Era of Digital Business

“…However, the mechanisms that allowed this structural separation to occur were cumbersome and expensive to implement. Thus, the concept of ambidexterity was expanded to enable individual divisions to become "contextually ambidextrous" by requiring each division to pursue exploratory and exploitative activities in balance [23]. However, in the context of digital transformation, there appears to be a reversion to structural ambidexterity on the business side, with business units undertaking explorative digitization initiatives by forming separate innovation teams that exist outside traditional organizational structures.…”

Impacts of Hedonic and Utilitarian User Motives on the Innovativeness of User‐Developed Solutions

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