Simulating the effects of Knowledge co-creation policies in supply chain on NPD performance using system dynamics

Partner’s decision and policy making about allocating resource to innovation activities in a supply chain is not a static situation and to achieve a sustainable competitive advantage, the previous decisions must be reviewed continuously. However, this dynamic decision making process cannot be provided by the current static view. So, the current study presents a dynamic model to investigate endogenous and exogenous changes through designing feedback mechanisms and using system dynamics approach. Also, it provides a tool to analyze the behavior of system using different scenarios and policies. In addition to presenting the Cause and Effect diagram and Flow diagram, the study findings show that the most appropriate investment policy on innovation activities is the policy that allocates the resources based on the gap performance.