Knowledge Retention and New Product Development Performance

Drawing on examples from the Japanese automobile industry, this study investigated how differences in the ability to retain product-related knowledge across product generations affect product development performance. Two sets of analyses were conducted on this issue, based on data obtained from 229 key project members in 25 new product development projects. First, we investigated how knowledge retention infiuences perfornrance within well-established component development, which we called local performance. We found that, in general, dependence on archival-based mechanisms, such as documents, reports and computerized tools, rather than on individual-based mechanisms, tended to be associated with higher local perforrnance. Next, we analyzed our data set at the project level. Data suggested that retention of individual experience bases and communication with previous project members have positive impact on several performance indicators at the entire project level. In particular, we found that these individual-based retention mechanisms affected improvement of system performance derived from the complex interactions among diffierent engineering and functional domains. However, data also suggested that retention of prior experience tended to cause problems when