Please cite this article in press as: Badir, Y.F., et al., The performance impact of intra-firm organizational design on an alliance’s NPD projects. Res. Policy (2009), doi:10.1016/j.respol.2009.06.010 ARTICLE IN PRESS G Model RESPOL 2346 1–15 Research Policy xxx (2009) xxx–xxx Contents lists available at ScienceDirect Research Policy journal homepage: www.elsevier.com/locate/respol The performance impact of intra-firm organizational design on an alliance’s NPD projects 1 2 Yuosre F. Badir a,∗ , Bettina Büchel b , Christopher L. Tucci c 3 a School of Management, Asian Institute of Technology (AIT), P.O. Box 4, Klong Luang, Pathumthani 12120, Thailand 4 b International Institute for Management Development (IMD), Ch. de Bellerive 23, CH-1001 Lausanne, Switzerland 5 c Chair in Corporate Strategy & Innovation, College of Management of Technology, Ecole Polytechnique Fédérale de Lausanne (EPFL), College of Management of Technology, CH-1015 Lausanne, Switzerland 6 7 8 article info 9 10 Article history: 11 Received 21 August 2007 12 Received in revised form 4 June 2009 13 Accepted 29 June 2009 14 Available online xxx 15 16 Keywords: 17 New product development 18 Inter-firm network 19 Communication 20 Organizational design 21 Media richness 22 abstract This research contributes to the intra-organization, inter-organization, and new product development (NPD) management literature by studying the impact of a firm’s internal organizational design on the communication within and performance of NPD projects conducted with strategic alliance partners. The empirical data were collected from three in-depth case studies of network lead companies (NLCs) oper- ating in different industries. The three NLCs have different internal organizational designs, ranging from very flexible “organic” to very rigid “mechanistic.” In each NLC, a successful new-to-firm product devel- opment project was chosen for further detailed investigation. First, we identify the role the alliance’s NPD project characteristics and industry characteristics play in determining the “intensity level” and “media richness” of communication required between the alliance’s NPD project partners. Then, we examine how the internal organizational design influences the actual intensity and media richness of communication of the alliance’s NPD project that matches our assumptions of what is required. © 2009 Elsevier B.V. All rights reserved. 1. Introduction 23 Over the last 15 years or so, academic research has focused on 24 inter-firm relations — specifically, the role of alliances and networks 25 — almost to the exclusion of intra-firm organization (Argyres and 26 Silverman, 2004). This research aims to partially address this imbal- 27 ance by drawing on the intra-organization, inter-organization, and 28 new product development (NPD) literatures to investigate the 29 performance impact of a firm’s internal organizational design on 30 strategic alliance communication and performance. Specifically, we 31 examine NPD projects conducted with strategic alliance partners. 32 Effective communication and information processing are among 33 the main purposes of a firm’s internal organizational design 34 (Aldrich, 1999; Clark and Fujimoto, 1991; Galbraith and Nathanson, 35 1978; Mintzberg et al., 1995; Olson et al., 1995). Since the 1960s 36 (e.g., Katz and Kahn, 1966; Thompson, 1967), there has been a 37 significant body of literature investigating the impact of a firm’s 38 internal organizational design on the firm’s innovation capability 39 (Argyres and Silverman, 2004; Eisenhardt and Tabizi, 1995; Tidd 40 et al., 1997), which emphasizes the importance of internal com- 41 munication and information sharing (Millson and Wilemon, 2002; 42 ∗ Corresponding author. E-mail addresses: badir@ait.ac.th (Y.F. Badir), bettina.buchel@imd.ch (B. Büchel), christopher.tucci@epfl.ch (C.L. Tucci). Moenaert et al., 2000; Tushman and Nadler, 1978) on the perfor- 43 mance of organizations and their development projects (Dalton et 44 al., 1980; Malhotra et al., 2001; Menon et al., 2002; Olson et al., 45 1995; Russo and Harrison, 2005; Tatikonda and Rosenthal, 2000). 46 In today’s more highly networked world, advancement in NPD 47 processes is being driven by new constellations involving net- 48 works, joint ventures, alliances, and relations based on outsourcing 49 (Staudenmayer et al., 2005). In these inter-firm relations, activities 50 within the NPD process tend to be carried out by separate functions 51 within or across company boundaries. Once an activity is com- 52 pleted, the output is sent to the next function in the process — either 53 within or across company boundaries — so that those responsible 54 can contribute their specialized knowledge and skills to develop 55 the product (Badir et al., 2008). This typically requires that mem- 56 bers of a product development team, each coming from potentially 57 different firms, communicate and coordinate with one another in 58 order to accomplish their development activities (Staudenmayer et 59 al., 2005). Thus, communication and information processing with 60 external partners (Allen and Oscar, 1989; Badir et al., 2003; Gerwin, 61 2004; Hauptman and Hirji, 1999; Moenaert et al., 1994; Tushman 62 and Katz, 1980) become as important as they are within firms 63 (Allen, 1977; Moenaert et al., 2000; Ulrich and Eppinger, 2000; 64 Wheelwright and Clark, 1992). 65 An important question emerges: Does the internal organi- 66 zational design that the company has adopted also support 67 communication with external partners, and thereby improve the 68 0048-7333/$ – see front matter © 2009 Elsevier B.V. All rights reserved. doi:10.1016/j.respol.2009.06.010