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An Empirical Study of the Relationships among Co‐location, Integration, Performance, and Satisfaction
Author(s) -
Kahn Kenneth B.,
McDonough Edward F.
Publication year - 1997
Publication title -
journal of product innovation management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.646
H-Index - 144
eISSN - 1540-5885
pISSN - 0737-6782
DOI - 10.1111/1540-5885.1430161
Subject(s) - business , quality (philosophy) , marketing , product (mathematics) , process (computing) , work (physics) , customer satisfaction , operations management , computer science , economics , engineering , mechanical engineering , philosophy , geometry , mathematics , operating system , epistemology
Co‐locate or perish. In this era of cross‐functional integration, are these the only choices for the departments that participate in the new product development (NPD) process? Bringing together different departments certainly seems like a good idea. After all, breaking down the walls between functions improves the quality of the inputs to NPD and thus increases the likelihood of success. On the other hand, a firm would be ill‐advised to implement co‐location simply because it seems like a good idea. Such a complex undertaking requires careful consideration of the costs, the benefits, and the effects of co‐location. Noting the need for more in‐depth knowledge in this area, Kenneth Kahn and Edward McDonough present the results of a study that explores several issues regarding co‐location and its relationship to interdepartmental integration, performance, and satisfaction. For example, does co‐location relate directly to improved performance and satisfaction in working with personnel from other departments? Or does co‐location play a moderating role, fostering improved interdepartmental collaboration and interaction, which in turn increase performance and satisfaction? And finally, do the effects of co‐location depend on which departments are involved? For example, do the benefits of co‐locating marketing and R&D exceed those of co‐locating manufacturing and R&D? The 514 survey respondents work as department managers in member companies of the Electronic Industries Association. The study includes an even distribution of responses from managers of marketing, manufacturing, and R&D departments. Most respondents have firsthand knowledge of the effects of colocation; 68% of the marketing managers report that they are co‐located with manufacturing, and 80% of the marketing managers are co‐located with R&D. R&D and manufacturing managers fall between those levels, with roughly 75% indicating that they are co‐located with the other departments. While generally supporting the premise that co‐location is helpful for integrating departments, the survey results indicate that co‐location has department‐specific effects. For example, the findings indicate that co‐location facilities collaboration between R&D and marketing, but not between manufacturing and the other departments. The findings do not point to a direct relationship between co‐location and performance. On the other hand, the results suggest direct links between collaboration and both performance and satisfaction.