ORCHESTRATING INNOVATION: DIVERSITY OF TEAM CHARACTERISTICS IN THE SYMPHONY OF NEW PRODUCT DEVELOPMENT

Abstract

This study investigates the strategic orchestration of New Product Development (NPD) teams, focusing on how age diversity influences their innovation capabilities within the competitive landscape of firms. As firms encounter an evolving demographic landscape, the role of team composition, particularly age diversity, becomes critical in tuning innovation and market alignment. This paper synthesises the disparate findings from the innovation management literature on the impact of age diversity, employing dual theoretical perspectives: information/decision-making and similarity/categorisation. The former suggests that age diversity brings diverse knowledge that boosts innovation, while the latter indicates it might hinder social cohesion and team performance. Addressing the gaps in existing research, this study explores tenure diversity and team familiarity as moderators in the age diversity–performance relationship. It hypothesises that tenure diversity can enhance knowledge exchange and innovation but may complicate social interactions, whereas high team familiarity might restrict new idea generation by homogenising knowledge. Empirical analysis conducted on a dataset of 21,370 observations from Japanese sake breweries reveals that tenure diversity and team familiarity are critical in moderating the effects of age diversity on NPD outcomes. These findings enrich the NPD literature by highlighting the importance of demographic diversity and provide new insights into managing age-related dynamics in team settings. The study underscores the need for managerial strategies that leverage demographic diversity to enhance NPD effectiveness.