Physical Co-Location and the Success of New Product Development Projects

Abstract

This study investigates the relationship between the use of physical co-location and the success of new product development projects. It is proposed that physical co-location leads to higher frequency of face-to-face meetings. The higher frequency of face-to-face meetings are proposed to lead to more successful new product development projects. Data were gathered from 82 firms. The findings indicate that physical co-location is positively related to the frequency of face-to-face meetings. The frequency of face-to-face meetings is significantly and positively correlated with a new product development project's schedule performance. There is also a borderline significance between the frequency of face-to-face meetings and a project's final product quality. The managerial implications of this study are presented.