The effect of information sharing and reward within a product innovation team

Abstract

Information-sharing in a team is believed to enhance performance. Does this enhanced performance lead to improved levels of idea generation and faster product development? Catering to this gap in the literature, this study examines the following research questions: (1) How different levels of information sharing and rewards affect idea generation? and (2) How different levels of information sharing and rewards affect the total time taken to develop new products? Here, a product innovation team in a high technology setting, such as, consumer electronics in the US is studied. This study includes a simulation model that uses a combination of information sharing and reward. The results indicate that irrespective of the reward conditions, a low information sharing team leads to low idea generation in all team sizes. However, a team with low information sharing and high reward generates new products at a fast rate. This is contrary to the general expectations of managers that low information sharing is not a healthy happening. The results also indicate that a large team with any combination of information sharing and reward leads to low idea generation. Theoretical contribution and managerial implications of these results are further discussed.