THE FIT BETWEEN NEW PRODUCT STRATEGY AND VALUE CHAIN STRATEGY : A SYSTEM DYNAMICS PERSPECTIVE

New product development has been a key element fur organizational evolution. The bulk of research about new product strategy has focused solely on new product development function itself. This paper investigates cross-functional elements in new product development. More specifically, we suggest that there must exist a fit between new product strategy and value chain strategy. It means that, in order to support new product development activity, there must exist a relevant value chain strategy. We consider three types of integration - internal integration, customer integration, and supplier integration - as strategic elements of value chain strategy. For the case of new product strategy, we consider market newness and product technology unfamiliarity as strategic elements. We also consider two types of learning characteristic, i.e., \\\"fast-adaptive learning\\\" and \\\"slow-adaptive leaning\\\" as control factor. Learning characteristic represents firms organizational capability related with organizational learning. For example, fur fast-adaptive learning case, the effect of integration appears early in time. System dynamics simulation is employed to verify our research framework. The results exhibit that there must exist cross-functional relationships between value chain strategy and new product strategy in order to shorten total development time.al development time.