How the Supplier Relationship, Market Position, and Proximity Impact Supplier Involvement and New Product Performance: Co-developing new products with close suppliers who are market leaders results in better NPD performance.

Overview: In today’s rapidly changing and competitive global business environment, companies must continuously develop successful new products. Recent studies indicate that supplier involvement in new product development (NPD) enhances firms’ competitive advantage and new product performance. In this study, we focus on the moderating effects of supplier involvement on NPD performance. We found that supplier relationship and supplier market position moderate the relationship between supplier involvement and NPD performance. Our findings suggest that co-developing new products with close suppliers who are market leaders results in better NPD performance.