New Service Teams as Information-Processing Systems

This article theoretically and empirically examines the antecedents and consequences of project communication during the new financial service innovation process. The authors analyze project communication comprising both intraproject communication and extraproject communication (i.e., boundary spanners) and adopt the view that project teams within banks are primarily information-processing systems directed toward reducing innovative uncertainty. The research findings indicate that the level of complexity contributes to intraproject communication, whereas centralized project environments appear to be a barrier for communication within the project team. Curvilinear relationships (inverted U) are substantiated between project climate and intraproject communication and between formalization and boundary-spanning communication. The authors’ findings provide support for the fact that effective project communication is contingent upon the level of cross-functional cooperation and that the relationship with project success is an indirect one, mediated by the level of innovative uncertainty reduction.