Formalization of Front End Process

Formalization of the Front-end Phase of the Innovation Process – Competitive Advantage or a Path to Downfall?
Jarno Poskela, [e-mail] Helsinki University of Technology, Finland

Abstract
The influence of front-end process formalization on front-end performance is currently intensively debated issue in the new product development literature. The main line of arguments state that process formalization in general kills creativity and leads to decreased innovativeness. However, studies that would have investigated the effect of formalization of the front-end phase, the creative and chaotic early part of the innovation process, are scare. Typically studies consider both front-end phase and development project phase simultaneously, thus averaging the totally different characteristics of these two phases. This article tested the association between front-end process formalization and perceived superiority of created product concepts. In addition, this article tested the classical contingency hypotheses whether the task uncertainty moderates this relationship. The study is based on exploratory factor analysis and multiple regression analysis that are used to investigate 133 frontend cases collected from Finnish industrial companies. The results indicated, opposite to the existing theory, that front-end process formalization is associated with superior product concepts. In addition, market uncertainty positively moderates this association, i.e. the more market uncertainty is present the more positive is the association. Implications of results from theoretical and practical point of views are discussed.

Introduction
The foundation for successful new product development is created in the front-end phase, which refers to the activities that take place before the formal development project phase (Koen et al., 2001). The overall structure and the main characteristics of the future product are all decided in the front-end phase, which then strongly affects

References: [1] Abernethy, M. A. & Brownell P. (1997). Management control systems in research and development organizations: The Role of accounting, behaviour and personnel controls. Accounting, Organizations and Society, Vol. 22, No. 3/4, 233-248. [2] Amabile, T. M. (1998). How to kill creativity: Keep doing what you 're doing. Or, if you want to spark innovation, rethink how you motivate, reward, and assign work to people. Harvard Business Review (September-October): 77- 87. [3] Armstrong, J. S. & Overton, T. S. (1977). Estimating nonresponse bias in mail surveys. Journal of Marketing Research, Vol. XIV, 396-402. [4] Benner, M. J. & Tushman, M. (2002). Process management and technological innovation: a longitudinal study of the photography and paint industries. Administrative Science Quarterly, 47, 676-706. [5] Bonner, J.M., Ruekert, R. W. & Walker, Jr. O.C. (2002). Upper management control of new product development projects and project performance. The Journal of Product Innovation Management, 19, 233245. [6] Brown, S. L. & Eisenhardt, K. M. (1997). The art of continuous change: linking complexity theory and time-paced evolution in relentlessly shifting organizations. Administrative Science Quarterly, Vol. 42, No. 1, 1-34. [7] Buggie, F. D. (2002). Set the ”fuzzy front end” in concrete”, Research Technology Management, 45, 11-15. [8] Burns, T. & Stalker, G. M. (1966). The management of innovation. Second Impression, Tavistock Publications. 269 p. [9] Cagan, J. and Vogel, G. M. (2002). Creating breakthrough products: innovation from product planning to program approval. Prentice Hall. [10] Campbell, D. T. (1955). The informant in quantitative research. The American Journal of Sociology, Vol. 60, No. 4, 339-342. [11] Campbell, D. T. & Fiske, D. W. (1959). Convergent and discriminant validation by the multitraitmethod matrix. Psychological Bulletin, 56, 2, 81-105. [12] Choudhury, V. & Sabherwal, R. (2003). Portfolio of control in out-sourced software development projects. Information System Research, 14, 3, pp. 291-314. [13] Cleland, D. I. & King, W. R. (1975). System analysis and project management. McGraw-Hill Book Company. 398 p. [14] Cooper, R. G. (1998). Winning at new products: accelerating the process from idea to launch. 2nd Edition, Addison Wesley Publishing Company. 358 p. [15] Cooper, R. G. (1994). New products: The factors that drive success. International Marketing Review. Vol. 11, No. 1, 60-76. Note: Please take contact to the author for the full list of references.