Academic journal article Journal of Small Business Strategy

New Product Development Project Management: Differences between Korean and U.S. Small Business Executives

Academic journal article Journal of Small Business Strategy

New Product Development Project Management: Differences between Korean and U.S. Small Business Executives

Article excerpt


The manifestation of cross-cultural differences in project management practices in small firms has received scant attention in existing literature. Based on a sample of 66 U.S. business executives and 62 Korean business executives, we find empirical support for the persistence of cross-cultural differences in the decision criteria used in project evaluation and management. Our findings reveal interesting differences in criteria used in project management. For example, while U.S. business executives emphasize safety management, Korean executives did not. We conclude with implications for future research, practitioners, and regulators.

Keywords: New Product Development, Project Management, Small Businesses


"Our economy is increasingly characterized by change and change means projects" (Verzuh, 2003)

Recognizing the preponderance and relative impact of small businesses as major contributors to job creation and economic growth, especially during the past decade, academic research on small business management practice has recently grown dramatically. In particular, topics concerning the strategic growth of small businesses have received much attention from researchers. In order to grow, many small businesses choose externally driven outsourcing projects (e.g., building and maintaining upstream or downstream portion of supply chain) or internally driven new product development projects as a path of strategic growth (Kerzner, 2009; Lyles, Baird, Orris & Kuratko, 1993; Merz, Weber & Laetz, 1994; Pearson & Ellram, 1995; Pons, 2008; Shenhar & Dvir, 2007; Slevin, Cleland, & Pinto, 2002). Essentially, project management in the context of small businesses is of critical importance because of its impact on the company's strategic growth and long term performance.

A project is "a temporary endeavor undertaken to create a unique product or service" (Project Management Institute, 2001, p. 167). As firms focused on enhancing their core competence and developing cooperative strategies over the last decade, their ability to manage projects has become a critical source of strategic competence and competitiveness in business. According to Shenhar and Dvir (2007), factors such as compression of the product life cycle, global competition, knowledge explosion, corporate downsizing, and increased customer focus have contributed to a recognition of the importance of project management.

Effective project management results in several competitive advantages. Besides aiding in the improvement of overall customer value, effective project management can lower development and procurement costs, increase flexibility, spur innovation, and speed up product development (Gray and Larson, 2003). Several anecdotal examples support the notion that effective project management can be a source of sustainable competitive advantages (Jiang & Klein, 1999; Kerzner, 2001; Kloppenborg, Shriberg, & Venkatraman, 2003; Park & Krishnan, 2002; Shenhar & Dvir, 2007). According to Park and Krishnan (2002), effective project management has enabled firms (e.g., P&G, GE, Microsoft, Cisco, HP, UPS, Southwest Airlines) to take responsibility for quality, slash inventories, reduce defects, and greatly improve efficiency of production and service.

In an attempt to explain the factors affecting project management practices and performance outcomes, recent research has focused on one important domain of project management: management effects (i.e., the "people" side of project management) (Cooke-Davies, 2002; Kloppenborg, et al., 2003). There is an abundance of research in the management literature on the impact of managers on organizational processes and outcomes (Hambrick & Mason, 1984). However, there is little research on the impact of national culture on project management process (e.g., selection and evaluation) and outcomes among small businesses (Slevin, Cleland, & Pinto, 2002). …

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