Are functional assets or knowledge assets the basis of new product development performance?

According to a recent survey, a major focus of new product development research links performance to mainly contextual, product-specific and internal organizational factors. Interestingly, and despite the development of models of appropriability, little of this research has assessed the impact of complementary assets and knowledge on performance. The research reported in this paper, using a sample afa 128 UK manufacturing firms, examines the role that knowledge and other complementary assets play in achieving new product success. Data from firms in different technological environments relating to strengths and weaknesses were combined into conceptual groupings, first on the basis of complementary assets embodying functional activities, and second on the basis of tangible and intangible assets and technical and non-technical knowledge. Although the functional assets grouping provided a better explanation of performance as regards new product development, the knowledge asset grouping provided a significant explanation, with intangible assets providing a more significant explanation than knowledge assets. In addition, performance in new product development was not positively related to size. Both the functional and knowledge-based conceptual groupings provided additional explanatory power over traditional explanations of success in new product development. Thus, asset complementary was demonstrated with the functional asset taxonomy providing the superior classification for the analysis of complementary assets.