Realizing Product Harmonization Under Market Demand Heterogeneity : Reconciliation of Competing Logics in New Product Development

For multinational corporations (MNCs), the product strategy regarding global standardization vs. local adaptation has long been regarded as a trade-off. In this study, we focus on the underlying logics, i.e. efficiency logic and market logic, which are competing under market demand heterogeneity. We develop the concept of product harmonization which enables competing logics to be reconciled and explore how MNCs realized product harmonization. From qualitative case study analysis of four MNCs, we find that: (1) efficiency and market logics manifest themselves in new product development (NPD) through three processes: power centralization, pluralistic input, and contingent compromise; (2) the logics are reconciled in two means: combination and accumulation. The findings unfold the complexity of MNCs which embrace and reconcile competing logics to achieve superior performance. Such complexity will likely influence organizational structures, processes and activities. Also, our study contributes to a better understanding of how competing logics can be reconciled in organizations