The Impact of Social Capital and Dynamic Capabilities on New Product Development: An Investigation of the Entertainment Software Industry

Businesses today face intense international competition, a heightened pace of development and shortened product life cycles. As a result, many researchers recommend firms collaborate and partner with other firms to succeed. With over a decade of research examining alliances and inter-firm collaboration, we know a great deal about the benefits and outcomes firms realize through collaboration. An important gap exists, however, in our understanding of the effect of partnering firms on collaborative outputs. This study attempts to address this gap by examining the success of collaborative new product development outputs. The study was a quasi-experimental study using archival, time-series data. Hypotheses were tested at the project level, defined as the product output from the collaborative development effort. Predictors were developed at both the firm and dyadic levels. Several findings emerged from this research. The primary finding is that roles of alliance partners impact which capability and capital benefits accrue. Firms functioning as a publisher benefit from increases in relevant experience. Firms functioning as a developer benefit from working in areas in which they have experience, but largely to the extent that the developer also generalizes their capabilities. One implication emerging from the capability findings suggests a need for configurational capability research. From a social capital conception, developers with high network centrality have a negative impact on the perceived quality of the final software product. Developers also benefit from embeddedness, products developed by developers in constrained networks outperformed products developed by developers in brokered networks.