PRODUCT INNOVATIVENESS AND ENTRY STRATEGY - IMPACT ON CYCLE TIME AND BREAK-EVEN TIME

New product development time, or cycle time, has become a critical com petitive variable, particularly for small high-tech manufacturing firm s. The business press is filled with examples about large firms that h ave successfully reduced cycle time. This article investigates the rel ative impact of product innovation and entry strategy on cycle time an d initial market performance of small firms. Using a sample of seventy -three small manufacturing firms, Abdul Ali, Robert Krapfel, Jr., and Douglas LaBahn find that faster product development is associated with shorter break-even time. Their results also indicate that these firms are achieving shorter cycle time not by sacrificing product quality, but by keeping the technical content of the product simple. Past resea rch has not taken into account this relationship, and this may be one of the reasons why researchers have often suggested conflicting impact of entry strategy on market performance.