Customer Participation in New Product Development: The Contingent Effects of Product Development Proficiency and Task Uncertainty

In the literature on new product development, the positive effect of customer participation on the success of new products is under debate. Based on the contingency theory, explanations on inconsistent findings about this effect may be found. Therefore, drawing on the open innovation concept, this study considers customer participation as a success factor of new product development by reexamining its effect on new product development performance and hypothesizes the contingent role of product development proficiency (marketing and technical) and task uncertainty. To this end, survey data from 186 Iranian manufacturing firms are gathered, and research hypotheses are tested using structural equation modeling. The results indicate customer participation and NPD performance to not have a clear/unidirectional relationship. However, findings substantiate that this relationship becomes positive and significant in the conditions of high product development technical proficiency and task uncertainty. Finally, product development marketing proficiency was found to have no significant role in the relationship between customer participation and new product development performance. This study extends several streams of research in the new product development literature and proposes recommendations to managers of firms.