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The integration of marketing and R&D is a major concern for companies that want to improve their new product performance (NPP). For this integration, companies are using mechanisms such as physical proximity, cross‐functional teams, and job rotation. This study examines the effectiveness of these mechanisms by developing a model that distinguishes between indirect effects of mechanisms on NPP (i.e., through a higher level of integration) and direct effects. The model is tested with data collected from 148 pharmaceutical companies. We were able to measure and compare the effectiveness of seven different integration mechanisms, which produced insights that are interesting and relevant for theory as well as practice.

We found that housing marketing and R&D closer to each other and using an influential cross‐functional phase review board are the most effective mechanisms to foster integration. Equal …