Measures and Validation

We used the scale developed by Olson, Walker, and Reukert (1995) to measure new product quality. Ten items asked team managers for their assessment of the degree to which the new product delivers value to the customer and meets the quality control standards laid out for it by the team/organization. These ten items were as follows: (1) Quality of this product compares

well with similar product offered by your competitors, (2) The product meets the customer’s needs, (3) Complaints have been received regarding the poor performance of this product, (4) The product meets the specifications outlined for it, (5) The product is reliable, (6) This product is of a higher quality than competing products available to customers, (7) The product’s performance shows little deviation from expected standards, (8) Quality of this product compares well with other products developed by our organization, (9) The consumers of this product perceive our product to be better than our competitors’, and (10) This product will deliver benefits to the customers that are not currently available to them. A seven-point Likert scale (1 =

“strongly disagree” and 7 = “strongly agree”) was used for each item. The ten items were averaged to produce a measure of new product quality.

3.2.2. Functional Diversity

We measured functional diversity with the diversity index recommended by Teachman (1980) and used by Ancona and Caldwell (1992) and Keller (2001):

)

Under this formula, the greater the distribution of new product development team members across different functional areas, the higher the score would be for functional diversity.

Membership in a functional area was determined by company organization charts. In this formula, H represents heterogeneity and P is the fraction share of team members assigned to marketing,

manufacturing, engineering, and so forth. Thus, the diversity index represents the products of each function’s proportion in the team and the natural log of its proportion. The only exception occurs when an area is not represented (Ancona & Caldwell, 1992; Keller, 2001; Teachman, 1980).

3.2.3. Tenure Diversity

Allison (1978) and Pfeffer and O’Reilly (1987) suggest that the coefficient of variation (the standard deviation divided by the mean) provides the most direct and scale in-variant measure of dispersion. Therefore, to assess the relative homogeneity of team’s tenure, each team’s standard deviation of tenure was divided by the team mean (Ancona & Caldwell, 1992).

3.2.4. Capability of Information Integration

The measure used to evaluate the capability of information integration is based on the conceptualization of integration suggested by Gupta, Raj, and Wilemon (1986) and the measure of market information used suggested by Deshpand and Zaltman (1982). We used four items to measure the degree to which members of a new product development team share, pay attention to, and challenge one another’s information and perspectives to discover new ideas about the product. Members were asked to evaluate the following: (1) Members freely share information and perspectives with one another, (2) When making important project-related decisions, members pay great attention to the information and the perspectives of members from other departments, (3) Members freely challenge the assumptions underlying one another’s ideas and perspectives, and (4) Exposure to the information and perspectives of other departments help members think of new ideas about the product. Items for each construct were scored on a seven-point Likert scale (1 = “strongly disagree” and 7 = “strongly agree”). We averaged these items to produce a measure of capability of information integration.

3.2.5. Speed-to-Market Pressure

We used three items developed by Sethi (2000a) to measure speed-to-market pressure that team members experienced during the development of new product. Items for each construct were scored on a seven-point Likert scale (1 = “strongly disagree” and 7 = “strongly agree”).

These items were as follows: (1) On this project, team members often wished they had more time to complete their work, (2) On this project, team members had plenty of time to think carefully about project-related details, and (3) On this project, team members believed they were under a high degree of speed-to market pressure. Items were averaged to produce a measure of speed-to-market pressure on team members.

3.2.6. Product Innovativeness

Four items, derived from Booz, Allen and Hamilton (1982), were used to assess how novel the product was for the firm. Respondents were asked to select one of four items: (1) an improvement/modification in one of the firm’s existing product, (2) a new product added to one of the existing product lines, (3) a new product that is a new line for the firm, but similar products are offered by other companies, and (4) a totally new product, and no similar products are offered by other companies, to indicate the perspective of their firm on product innovativeness. A score of four indicates that innovativeness is high and the product is novel for the firm, and vice versa.

3.2.7. Quality Orientation

We used three items to measure quality orientation: the extent to which a firm (a) emphasizes product quality (b) creates a commitment to produce a quality product among its employees, and (c) implements total quality management. A seven-point Likert scale (1 =

“strongly disagree” and 7 = “strongly agree”) was employed for all items. We averaged these items to produce a measure of quality orientation.

3.2.8. Supplier Involvement

Three items asked informants for their assessment of supplier’s involvement in the

development process. Items reflected the extent to which input and feedback from suppliers was relied on in the development of the product idea/concept, the evaluation of product idea/concept, and the development of design. A seven-point Likert scale (1 = “a great extent” and 7 = “not at all”) was employed for all items. Items were averaged to produce a measure of supplier involvement.

3.2.9. Customer Involvement

Three items asked informants for their assessment of customer’s involvement in the development process. Items reflected the extent to which input and feedback from customers were relied on in the development of the product idea/concept, the evaluation of product idea/concept, and the development of design. A seven-point Likert scale (1 = “a great extent” and 7 = “not at all”) was employed for all items. Items were averaged to produce a measure of customer involvement.

3.2.10. Covariate

Team size was included as a control variable because prior research has found it to be related to cohesiveness and internal communication for teams (Ancona & Caldwell, 1992; Bantel

& Jackson, 1989).