The Impact of Information Technology on New Product Development Performance

Many managers expect a substantial impact of digitization on new product development (NPD) as it is an information‐intensive business process. Therefore, a better understanding of how information technology (IT) might improve the NPD process is important for both theory and practice. Drawing on the IT business value literature, this study develops a comprehensive conceptual model to investigate empirically how IT and non‐IT organizational antecedents translate into NPD IT capabilities and competences and how these are related with NPD performance. Based on survey data from German NPD managers, this study offers several insights. First, it shows that the development of superior NPD IT capabilities and competences depends on the ability to acquire and deploy suitable IT (i.e., firm‐level IT capabilities) and on appropriate strategic, structural, and cultural conditions ensured by a strong top management focus on NPD IT (i.e., executive champion for NPD IT). This study hence contributes empirical evidence to the NPD and the IT business value literature by expanding research on complementary resources. Second, this study addresses limitations regarding the conceptualization of NPD IT capabilities and their relationship with further sources of competitive advantage arising from NPD IT tool usage by considering both the effectiveness and the frequency of usage as well as the relationship between both. Third, this research updates the measurement of NPD IT tool usage effectiveness (i.e., IT leveraging competence) to account for technological developments. Moreover, this study reveals that the effectiveness of NPD IT tool usage is positively associated with NPD performance. It also highlights that the dissemination of IT tools does not directly increase NPD performance, but that NPD IT tool use frequency is an important antecedent of IT leveraging competence. For managers, this paper offers empirical evidence that firm‐wide IT capabilities and a focus on NPD IT are important predictors of NPD performance.