Interaction orientation and NPD performance: the process through market-relating capabilities.

While more and more academicians and practitioners are increasingly aware of the value of customer interaction in new product development (NPD), this study draws on the resource-based view (RBV) to focus on the internal process through which a firm's interaction orientation affects product development performance. The results of a survey of 167 electronics companies in Taiwan provide support for a process link between interaction orientation, market- relating capabilities (i.e., marketing and market-linking capabilities) and product development performance. More specifically, the interaction orientationÐproduct development relationship is mediated by both marketing and market-linking capabilities, while the interaction orientationÐproduct innovativeness relationship is partially mediated by marketing capability. In addition, a firm's interactive rationality reinforces the impact of interaction orientation on marketing capability. The findings of this study provide strategic insights into NPD. [ABSTRACT FROM AUTHOR]