This study is the first to examine the impact of acquisitions on the post-acquisition new product quality of acquired firms. We argue that the acquisition process can introduce technological coordination challenges that disrupt the innovation processes and routines of acquired firms, thereby increasing the likelihood of new product failures. To test our hypotheses, we employ a difference-in-differences and matching approach within the U.S. medical device industry, finding strong empirical support for our main argument. Specifically, we identify several technological coordination processes that influence product quality in acquired firms, including the integration of the acquirer’s products with those of the acquired firm, the launch of new products within the acquirer’s product domain, and the development of complex new products leveraging the acquirer’s technologies.

qjoanne@ceibs.edu