New Product Development Decision-Making Effectiveness: Comparing Individuals, Face-To-Face Teams, and Virtual Teams

A total of 41 1 subjects participated in two decision-making experiments in order to examine the effectiveness of new product development project continuation decisions. Using escalation of commitment theory, in Study 1 , individual versus face-to-face team decision-making effectiveness was compared. Study 2, an extension of Study 1, compared the new product development decision-making effectiveness of individuals, face-to-face teams, and virtual teams. A virtual team is a geographically and temporally dispersed and electronically communicating work group. In Study 2, the virtual teams communicated asynchronously via groupware technology. Our findings suggest that teams make more effective decisions than individuals, and virtual teams make the most effective decisions. Subject Areas: Computer-mediated Communication Systems, Multivariate Statistics, Product Development, Product Planning, Project Management, and Strategic Decision Making.