Home   |   Login   |   Register      

 

    

 

Working Paper

Interfunctional Rivalry and the Use of Market Information by R&D Managers: The Effects of Managerial Actions

Elliot Maltz, William E. Souder, and Ajith Kumar, 1999 [99-123]

View/Order Item >>
Comments from members >>

Although enhanced marketing/R&D interaction is thought to improve innovation efforts, empirical support for the effectiveness of mechanisms such as crossfunctional teams, co-locating functions, and joint customer visits has been largely limited to anecdotal evidence. In this study, authors Maltz, Souder, and Kumar investigate whether and how the remedies proposed in the literature actually have a positive impact on the information-processing behaviors of R&D managers. Data collected from 718 respondents at 256 high technology organizations revealed that R&D managers use information in two distinct ways: (1) to make immediate decisions (instrumental use), and (2) to change their mental model of the marketplace (conceptual use). Further, mechanisms to increase R&D/marketing interactions have different effects on each kind of information use.

• Crossfunctional teams have the strongest positive effects on both instrumental and conceptual use of market information.

• Customer visits that include members of both marketing and R&D reduce rivalry and indirectly increase both instrumental and conceptual use.

• Customer visits by R&D managers without a marketing manager increase R&D's conceptual use of market information, which is likely to make R&D managers more cognizant of marketplace needs in developing new products.

• Increasing the number of social events where marketing and R&D managers can meet on an informal basis increases both conceptual and instrumental use of market information by R&D managers.

• Co-locating marketing and R&D managers has positive effects on market information use in relatively large organizations. Finally, increasing the rate of change in organizational practices (structural flux) tends to increase rivalry and reduce instrumental use of market information. However, it increases the conceptual use of market information by R&D managers.

Managerial Implications

Perhaps the most fundamental lesson of this study for managers is the multiple negative effects of interfunctional rivalry on information use. Rivalry reduces trust, thereby lowering the perceived quality of the information being shared, and in turn reducing the propensity of R&D personnel to use market information in decision making. Thus, even information perceived as relatively valuable may not be used in organizations where R&D sees marketing as a competitor for scarce resources. This is a particularly important finding, given anecdotal evidence that firms are becoming more resource scarce and that downsizing is on the rise, particularly in large firms.

The two most effective means of reducing perceptions of rivalry appear to be crossfunctional team use, which is already widely accepted in organizations, and customer visits by both marketing and R&D managers. The second strategy deserves particular attention. In joint customer visits, R&D managers are likely to see the value of the marketing function in facilitating useful interactions between the client technical personnel and the R&D manager. This view of marketing as a valuable partner is likely to lead to more use of market information, and to improve cooperation, resulting in more successful new product launches.

The study also highlights how top management philosophies, if taken to extremes, can increase rivalry between functions and inhibit the use of information by R&D managers. Although recent managerial writings have extolled the virtues of flexible organizations, this study suggests that turbulent internal environments can increase rivalry between functions, reduce perceptions of information quality, and lower the instrumental use of information (which is particularly important in the implementation phase of new product development). On the other hand, managers faced with swiftly changing internal environments tend to use information conceptually to change their views of the organization and/or the marketplace. This is an important finding since successful innovation may depend on maximum information use—particularly conceptual use—during the planning phase of the project. It suggests that structural flux may have some benefits for the innovation process.

Elliot Maltz is Associate Professor of Marketing, Atkinson Graduate School of Management, Willamette University. William E. Souder is Eminent Scholar, University of Alabama in Huntsville. Ajith Kumar is Professor, Department of Marketing Administration, Arizona State University.

Included in the following collections:
1999 Working Paper Series

---

Comments from members

Please login to view and/or submit comments

---

View/Order Item

Online version
Your Price: $5.00
Hard copy
List Price: $5.00 Your Price: $5.00

Please login for full access and discounted pricing.