Profits & Personalities:
Relationships Between Profits from New Product Development and Analysts' Personalities
By: Greg A.
Stevens, James Burley, Ph.D. and Richard
Devine
Presented to the 1998
Research Conference at the Annual International Conference of the Product Development and
Management Association (PDMA), October 5-7, Atlanta GA |
This Article provides a continuation of a study of 69 analysts evaluating 267
early-stage New Product Development (NPD) projects in a major global chemical company over
a 10 year time span. Positive correlations were found between profits resulting from NPD
project analyses and personality attributes of the analysts evaluating those projects. The
strengths of correlations between profits earned and personality were compared using two
standard psychological instruments, the MBTI Creativity Index and
the Kirton Adaptor Innovator (KAI). Both can be used to measure creativity. The MBTI was
found to correlate significantly better with profits earned than the KAI.
Additionally, applying Keirsey's theory of Temperaments resulted in developing a new "Rainmaker Index" specifically tuned to
profitability from the "fuzzy front end" of NPD. Analysts with MBTI preferences
for intuition ("N") and thinking ("T") score highest on this
index.Analysts in the top third of the "Rainmaker Index" generatedn95 times more
profit than those in the bottom third ($8,230,000 vs $87,000 mean profit per analyst).
this compares to to 11 times more profit for the analysts in the top third of the
MBTI-Creativity Index vs the bottom third of the MBTI-CI. Hence, the "Rainmaker
Index" increases the odds of identifying analysts who will identify profitable
opportunities in the "fuzzy front end" of NPD by a factor of 8.6 times compared
to the previously reported MBTI-CI (95/11 = 8.6 times better).
Rainmaker Index vs Profit from NPD
NPD Success
Factor |
Lower Third |
Middle Third |
Upper Third |
Times Higher than
Middle Third |
Times Higher than
Lower Third |
Number NPD Analyses/Analyst |
2.61 |
3.43 |
5.57 |
1.62 |
2.13 |
% Ideas that Branched |
13.3% |
19.0% |
37.5% |
1.97 |
2.82 |
% Positive Recommendations |
22.5% |
25.9% |
46.9% |
1.81 |
2.08 |
Profit per Analyst, $MM |
$0.087 |
$0.93 |
$8.23 |
8.85 |
94.6 |
Profit per Project, $MM |
$0.03 |
$0.27 |
$1.48 |
5.48 |
49.3 |
Total Profit, $MM |
$2.00 |
$21.35 |
$189.30 |
8.87 |
94.7 |
|