INFLUENCES ON ORGANISATIONAL SLACK IN NEW PRODUCT DEVELOPMENT PROJECTS

Programs to decrease cost and to increase operational efficiency may reduce a company's ability to innovate, by reducing organisational slack. Previous research on the relationship between organisational slack and innovation has been at level of the firm and has neglected the processes underlying the relationship, which takes place at the level of product development projects. In this paper, we identify organisational slack and its influences at the level of the product development project. Through exploratory case research in high-velocity industries, two influences on organisational slack are identified: customer interaction and top management control. We also identify two categories of organisational slack at the product development project level: project deliverables and human competences. The two influencing variables and the two categories of organisational slack all have an effect on the knowledge creation taking place inside the projects and therefore ultimately innovation.