Help or Hindrance? The Role of Familiarity in Product Development Teams

ABSTRACT For products developed through a collaboration of specialized groups, success requires craft and engineering ingenuity from designers who focus on specific attributes, coupled with synchronized coordination between various design groups. Although shared work experience in the team—or familiarity—can improve coordination, it can deter creativity. We empirically study the impact of team familiarity on market performance of products by focusing on product development in the video game industry by coupling a granular database of development credits with sales data for video games. Although familiarity among coordinators has a positive effect on performance, familiarity among designers has a negative effect. Further, the positive (negative) effect of familiarity among coordinators (designers) is present even if familiarity is built through roles other than coordination (design). Overall, team familiarity is associated with a decrease in the product's market performance. Our results suggest that infusing fluidity in design roles and maintaining stability in coordination roles could improve the performance of new products.