A Study on the Effect of Supplier’s Strategy on New Product Development Performance

Purpose – In the joint development of new products, buyers and suppliers exchange information to solve various problems. Uncertainty and ambiguity are typical examples. Uncertainty refers to the lack of information to solve the problem, and equivocality refers to the case where the information is interpreted in multiple processes in the process of providing the information. These uncertainty and equivocality cause new products to be delayed in their development and adversely affect quality. However, unfortunately, there is a lack of researches on how the uncertainty and equivocality of such concepts control the results of new product joint development. But, smooth communication and effective exchange of information is not emphasized only in the general organization. The importance of the new product joint development projects to achieve the two organizations’ common goals becomes even greater. The purposes of this study are to analyse the effect of supplier’s strategy on the NPD performance and moderating effect of uncertainty and equivocality. Research design, data, and methodology – In order to make a contribution to the lack of academic researches in Korea, this study collects data through questionnaires based on organizational information processing theory and previous studies, and conducts empirical analysis. Results – As a result, the product modularization strategy and the strategic supply chain relationship positively influenced the new product development performance - return on investment and ease of manufacturing. And the interaction effect of uncertainty and equivocality with supplier’s strategy – product modularity strategy and strategic supply chain management relationship - reduces or negates the influence of product modularization strategy on new product development performance. Conclusions – This implies that it is important to control uncertainty and equivocality in order for the supplier strategy to have a pos