Taxonomy of New Product Development Process Risks: An Empirical Study of Indian Automotive Industry

New products are major sources of competitive advantage and success for most of the manufacturing enterprises. New product development (NPD) processes are getting increasingly complex due to today's globalized market and customers’ desire for technologically advanced products. This complexity comes along with added risks in the NPD process in terms of both number and severity, making it riskier and costly. Thus, the risk factors occurring in the NPD process need to be pre-emptively recognized at an early stage of the NPD process. This article provides a comprehensive study of the prevalent risk factors in the NPD process and proposes taxonomy of those risks based on an empirical research on Indian automotive industry. Exploratory and confirmatory factor analyses techniques are utilized to classify a large number of risks (obtained via systematic literature review and Delphi method) into seven underlying risk dimensions. The results of this article would help researchers and practitioners in developing a better understanding of the risk factors existing in their NPD projects and serve as a risk reference framework.