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Balanced Matrix Structure and New Product Development Process at Texas Instruments Materials and Controls Division

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Abstract

exas Instruments is a global player in thesemiconductor business. One of its divisions isMaterials and Controls (M&C), with European head-quarters in Almelo, the Netherlands. All the com-pany’s products are customer-specific. Productfunctionality and durability are qualifiers in the marketplace. Competition is mostly based on product price.Furthermore, delivery reliability is essential. Relativeto competition, the company is performing well on allthese indicators.Recently, product life cycles started to shorten. Thisrequired the company to look deeply into its time-to-market and, as its products are engineered to order,particularly new product development (NPD) leadtime. The company soon realised that its traditionalfunctional hierarchy would not allow a radical reduc-tion of time-to-market. In 1995 it was thereforedecided to change from the functional structure to aBalanced Matrix structure and to adopt a new projectmanagement procedure called the New Product Devel-opment Process – NPDP, in order to speed up NPDprojects by a factor two.The objective of the present paper is to describe andevaluate the design and implementation of, and thecompany’s experiences with, the new NPD organisa-tion and procedure and the contribution of the newsituation to the company’s performance in the marketplace. Based on that, lessons will be drawn for thetheory and practice of NPD management.

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... The authors did not include performance measures in their study. Finally, in a case study of implementation of a structured NPD process at Texas Instruments, Bernasco et al. (1999) observed that meetings, committees and telephone calls improve interaction, but not necessarily collaboration. Collaboration is improved by sharing goals, mutual understanding and informal activity. ...
... Jassawalla and Sashittal, 1998) explore the integration mechanisms only and do not look at performance; similarly, Hauptman and Hirji (1999) explore the integration mechanisms, but not functional integration per se. Kahn (1996) and Bernasco et al. (1999) concentrate on interdepartmental integration, and not on integration at the level of the NPD project. Other contributions to the study of the relationship between functional integration and performance tend to focus on one of its dimensions only; for example, Gupta and colleagues (Gupta et al., 1985; 1986) and Song and colleagues (Song and Parry, 1992; Song et al. 1998) have mainly examined the interaction side of integration, which is defined as joint involvement between functional departments in a number of activities intimately related to NPD. ...
Article
The objective of this paper is to explore the relationship between performance in new product development (hereinafter NPD) and functional integration under different conditions of project uncertainty. Functional integration is conceived as a two-dimensional concept, encompassing a behavioural — collaboration — and a structural — interaction — dimension.This study is based on 92 questionnaires looking at NPD activities in more than 40 British and Dutch companies from various industrial sectors. The results suggest that the nature of the relationship between integration and performance is contingent upon the project stage and the degree of novelty in the new product. Integration in the initial stages of the project assumes a prominent role in the quality of the end product, whereas in later stages it is more associated with time to market than with costs and end product quality. Results further show that the dimension collaboration of integration may be more relevant under circumstances of high new product innovativeness than when minor variations are introduced in a new product. The paper ends with a discussion of the use of universal approaches to NPD management.
... Recently, more attention is given to project-based firms in the management literature. Issues that have been addressed are the characteristics of project-based organizations (Greenwood et al., 2005;Hobday, 2000;Whitley, 2006), the transformation of functional organizations to project-based organizations (Bernasco et al., 1999;Lindkvist, 2004), and knowledge exchange within these organizations (Prencipe and Tell, 2001;Robertson, Scarbrough, and Swan, 2003;Salter and Gann, 2003;Werr and Stjernberg, 2003). ...
... Future research will have to indicate to which extent the findings are applicable to other types of project-based organizations, such as project-based departments of firms (Bernasco et al., 1999;Hobday, 2000;Lindkvist, 2004), professional service firms that do not perform large complex projects (Fosstenlokken, Lowendahl, and Revang, 2003;Greenwood et al., 2005), and temporary project organizations (Defillippi and Arthur, 1998;Turner and Muller, 2003). Construct Innovation Manager Questionnaire Items ...
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The importance of project-based firms is increasing, as they fulfill the growing demands for complex integrated systems and knowledge-intensive services. While project-based firms are generally strong in innovating their clients' systems and processes, they seem to be less successful in innovating their own products or services. The reasons behind this are the focus of this paper. The characteristics of project-based firms are investigated, how these affect management practices for innovation projects, and the influence of these practices on project performance. Using survey data of 203 Dutch firms in the construction, engineering, information technology, and related industries, differences in characteristics between project-based and nonproject-based firms are identified. Project-based firms are distinguished from nonproject-based firms on the basis of organizational configuration, the complexity of the operational process, and the project management capabilities of the firm. Project-based firms also differ with regard to their level of collaboration and their innovation strategy, but not in the level of autonomy. A comparison of 135 innovation projects in 96 of the firms shows that project-based firms do not manage their innovation projects different from other firms. However, the effects of specific management practices on project performance are different, particularly the effects of planning, multidisciplinary teams and heavyweight project leaders. Differences in firm characteristics provide an explanation for the findings. The implication for the innovation management literature is that “best” practices for innovation management are firm dependent.
... Combining this with work by Lawrence and Lorsch (1967), recent work demonstrates a positive relationship between communications-intensive (face-to-face) integrating mechanisms and product development performance. 1 (For example Henderson and Clark, 1990;Clark and Fujimoto, 1991;Henderson, 1994;Iansiti and Clark, 1994;Scott, 1998;and Bernasco et al., 1999). It seems apparent that using integrating mechanisms can help product development; yet, we know much less about how integration does or does not work. ...
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Managers and scholars emphasize the importance of inter-departmental integration to successful product development and emphasize the importance of product development capabilities to firm performance. Interdepartmental integration can increase shared knowledge; this in turn can reduce the severity and incidence of seemingly unnecessary and costly mistakes leading to more efficient and effective product development. This paper examines the sources of shared knowledge problems across functional and product-based groups. Using interviews, product development plans, and time-sheet data, we look at the underlying factors behind two sources of knowledge sharing problems: (1) a serial product development process (i.e. little or no face-to-face communications) and (2) ineffective use of integrating mechanisms because of sticky knowledge. For each problem source, we find two key causal factors. We discuss the problems, their factors, and the implications for management and theory.
... Dada sua natureza, podem ser mais facilmente transcritos em procedimentos e práticas para uso nos níveis operacionais da firma e se tornam úteis na implementação das estratégias formuladas. Nesta linha, podem ser citados diversos trabalhos como Kline & Rosenberg (1986), Cooper e Kleinschmidt (1991), Roussel et al (1991), Rothwell (1994), Cooper (1994), Bernasco (1999), Cohen et al (1998) entre outros. A literatura apresenta numerosos modelos que têm como proposta um misto entre explicação e idealização de como a sistemática do processo de inovação se desenvolve, tanto no ambiente interno das firmas, como em suas interfaces com o meio externo. ...
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Innovation has been widely recognized as a key for competitive advantage and success in business and requires a lot of effort and discipline. The purpose of this article is to present a new reference model which aims to assist leaders to implement innovation management systems in their companies. This model is composed of six stages that include the basic activities for the innovation practice, taking in account the internal and external firm’s environments, the interdependencies throughout its stages and the required networking for the establishment of the innovation process. This reference model uses a business accessible language and its main distinction from the other existing models is the classification of “intelligence environment” and “strategies definition” as independent stages, once these are essential activities that deserve dedicated coordination.
... Following Kahn and Mentzer (1996), communication by itself does not guarantee the success of a business relationship, since this factor is supposed to be linked with a specific transaction of information. This view is also shared by Bernasco et al. (1999), who stated that communication processes such as meetings, committees or telephone calls do certainly improve the level of interaction, but not necessarily the level of collaboration. On the contrary, relationships based on collaboration emphasise the relational continuity and the integration between the exchange members. ...
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This paper focuses on the analysis of university-industry collaborations partnering for research agreements with the aim of fostering the transfer of knowledge and innovation. It analyses the key organisational factors that could contribute to the successful performance of these agreements from a relationship marketing perspective. More precisely, it examines the impact of relevant relationship variables - trust, commitment and integration - on university-industry cooperational success. Moreover, it also analyses the relevance that organisational compatibility and personal experience have as antecedents of these relationships. A structural equation model was proposed and tested. Results support that the key factors for firms to cooperate with universities are mainly the university-industry levels of integration, the level of university commitment towards firms and - to a lesser extent - the level of trust of a firm on the university counterpart. Therefore, this research will inform firm management seeking to develop successful research collaborations with universities.
... Following Kahn and Mentzer (1996), communication by itself does not guarantee the success of a business relationship, since this factor is supposed to be linked with a specific transaction of information. This view is also shared by Bernasco et al. (1999), who stated that communication processes such as meetings, committees or telephone calls do certainly improve the level of interaction, but not necessarily the level of collaboration. On the contrary, relationships based on collaboration emphasise the relational continuity and the integration between the exchange members. ...
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This paper focuses on the analysis of university-industry collaborations partnering for research agreements with the aim of fostering the transfer of knowledge and innovation. It analyses the key organisational factors that could contribute to the successful performance of these agreements from a relationship marketing perspective. More precisely, it examines the impact of relevant relationship variables - trust, commitment and integration - on university-industry cooperational success. Moreover, it also analyses the relevance that organisational compatibility and personal experience have as antecedents of these relationships. A structural equation model was proposed and tested. Results support that the key factors for firms to cooperate with universities are mainly the university-industry levels of integration, the level of university commitment towards firms and - to a lesser extent - the level of trust of a firm on the university counterpart. Therefore, this research will inform firm management seeking...
... Normative models can provide the basis for process clarification and systematization in companies. In this case, process models fulfill the function of a management tool (see e. g. Bernasco et al. 1999, p. 124, Cohen et al. 1998, p. 3, Cooper et al. 1991, p. 137, Cooper et al. 1994, p. 24, Hughes et al. 1996, p. 97, O'Connor 1994, p. 185). In contrast, descriptive models evolve from empirical studies and are not intended to advice managers. ...
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... This was highlighted in a case where Texas InstrumentsÕ Material and Controls Division in Europe designed a team structure, requiring people from different functional units to put aside their departmental associations, but work together in its new products. However, interviews with the team members showed that many team members continued to maintain their formal and informal links with their original departments [4]. This suggests that initiating a mere team structure with people from different departments may not be sufficient for the effectiveness of a team work, but a higher level team spirit and commitment needs to be emphasized. ...
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... ABC recognizes each customer individually and offers " tailor-made " slip ring solutions. ABC has many characteristics of engineer-to-order (ETO) companies in terms of its operation (Bernasco, Weerd-Nederhof, Tillema, Boer, 1999; Rahim & Baksh, 2003 ). For example, production in ABC is laborintensive and specialized labor skills are required, while product assembly is mainly manual. ...
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... If a number of projects are started concurrently, the resource capacities necessary to guarantee the achievement of one project's objectives may impede allocations to other projects and reduce the overall successes of the organization [27]. As a consequence, there may be particularly intense internal lobbying activities for available resources [3,8]. Furthermore, attempts to optimize resource allocations are complicated by differences in project activities, due dates, and the nature of penalties for projects that fail to meet their objectives [38,42]. ...
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... However, there are certain distinct differences between the two domains which will be elaborated in the following. Production processes are mostly recurring processes whereas development processes present unique or at least first-time processes for an entity [12]. The results of a development process are comparably hard to plan from the beginning of the process, which renders the definition of checklist content difficult [13]. ...
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Product and process quality was and still is a key factor of success for manufacturing companies in the competitive global business environment. The stage gate model represents a well-established method for quality management in the product development domain. This paper discusses the application of the stage gate model in the domain of production. The two domains differ in certain areas, which has to be reflected by the adapted stage gate model. The preliminary findings of the two case studies, covering manufacturing and assembly processes, indicate that an adapted stage gate model may provide valuable support for product and process quality improvement. However, the success is strongly dependent of the right adaptation, taking the individual requirements, limitations and boundaries into consideration.
... In a multiple-project situation the vast majority of projects share resources with other projects and thus the major issue is to find a way of handling resource scarcity according to the overall strategic direction of the corporation (Cusumano and Nobeoka, 1988). The competition among projects for the allocation of individual experts leads to disagreements (Platje et al., 1994;Payne, 1995;Laslo and Goldberg, 2008) and an intensification of internal lobbying activities (Chi and Nystrom, 1998;Bernasco et al., 1999). Furthermore, attempts to optimize resource allocations are confounded by differences in project activities, due-dates, and the nature of penalties for projects that fail to meet their objectives (Lock, 2000;Meredith and Mantel, 2000). ...
Article
It is well known that the progress of R&D projects has more and more begun to rely on the availability of individual experts who are generally scarce and expensive. The matrix structure considers periodic staffing of project teams which has been found to be efficient for non-scarce human resources but is impractical for individual experts. Our objective is to develop and evaluate an alternative approach for resource planning and scheduling that might be useful for project portfolio management. The method we suggest is an extension of a recently developed optimization model for a job-shop with several machines and chance-constrained deliveries. Our method determines in advance the hiring and releasing points of individual experts that maximize economic gain subject to chance-constrained delivery commitments. For this purpose, we use a simulation based on a greedy priority dispatching rule as well as a cyclic coordinate descent search-algorithm. A benchmarking of the staffing of project teams and the integrative methods shows that integrated planning and scheduling is a very useful tool for the decision-making process in project portfolio management.
... Scholarly interest in organizational implications of organizing by projects has originated from the research on matrix forms of organizations ( Galbraith, 1971Galbraith, , 1973Galbraith, , 2008Knight, 1976;Mintzberg, 1979). The focus in this literature has mainly been on the duality of coordination of project activities through functional and project arrangements and its positive and negative implications ( Arvidsson, 2009;Bernasco et al., 1999;Dunn, 2001;Kuprenas, 2003). By identifying the tensions and discussing various archetypes of matrix organizations ( Larson and Gobeli, 1989) the literature has provided important foundation for the discussion of project-based organizing. ...
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This review of the state of research on product development as of the mid-1990s finds that it is quite fragmented, and sets out to create a framework by which to view the literature. Most empirical research can be grouped into three views of the nature of the product development process: rational plan, communication web, or disciplined problem solving. Based on the prior research, a model of success factors is developed, which highlights the value of various stakeholders, or agents, and distinguishes between success in the process and a successful product. The focus on product development as successful when rationally planned identified the value of organizational characteristics such as cross-functional teams and product champions, and the importance of market conditions. Research on the role of communication, within the product development team and externally, focused on the importance of a communication strategy and the need for gatekeepers and boundary spanners on the team. The disciplined problem solving approach emerged first in studies of Japanese product development processes. This approach requires strong leadership and a clear vision. With a clear goal in mind, and input from various functions, there is also autonomy to experiment, going through multiple problem solving iterations. These research streams overlap, and from that commonality a model is developed herein that emphasizes the importance of such factors as cross-functional teams, strong leadership, resource availability and information flow. Three issues for future product development research are (1) the role of senior managers; (2) the organization of work (e.g., improvision vs planning); and (3) the connections and dependencies between the development process, market factors, effective products and financial performance.
Book
V olume 1 of Software Engineering, Third Edition includes reprinted and newly authored papers that describe the technical processes of software development and the associated business and societal context. Together with Volume 2, which describes the key processes that support development, the two volumes address the key issues and tasks facing the software engineer today. The two volumes provide a self-teaching guide and tutorial for software engineers who desire to qualify themselves as Certified Software Development Professionals (CSDP) as described at the IEEE Computer Society Web site (www.computer.org/certification), while also gaining a fuller understanding of standards-based software development. Both volumes consist of original papers written expressly for the two volumes, as well as authoritative papers from the IEEE archival journals, along with papers from other highly regarded sources. The papers and introductions of each chapter provide an orientation to the key concepts and activities described in the new 2004 version as well as the older 2001 version of the Software Engineering Body of Knowledge (SWEBOK), with many of the key papers having been written by the authors of the corresponding chapters of the SWEBOK. Software Engineering is further anchored in the concepts of IEEE/EIA 12207.0-1997 Standard for Information Technology—Software Life Cycle Processes, which provides a framework for all primary and supporting processes, activities, and tasks associated with software development. As the only self-help guide and tutorial based on IEEE/EIA 12207.0--1997, this is an essential reference for software engineers, programmers, and project managers. This volume can also form part of an upper-division undergraduate or graduate-level engineering course. Each chapter in this volume consists of an introduction to the chapter's subject area and an orientation to the relevant areas of the SWEBOK, followed by the supporting articles and, where applicable, the specific IEEE software engineering standard. By emphasizing the IEEE software engineering standards, the SWEBOK, and the contributions of key authors, the two volumes provide a comprehensive orientation to the landscape of software engineering as practiced today. Contents: Key concepts and activities of software and systems engineering Societal and legal contexts in which software development takes place Key IEEE software engineering standards Software requirements and methods for developing them Essential concepts and methods of software design Guidelines for the selection and use of tools and methods Major issues and activities of software construction Software development testing Preparation and execution of software maintenance programs
Article
The significance of project management structure on the success of 546 development projects was investigated. Multivariate procedures revealed that success varies according to the project structure used, even when other determinants are accounted for. Projects relying on the functional organization or a functional matrix were less successful than those which used a balanced matrix, project matrix, or project team. The project matrix outperformed the balanced matrix in meeting schedule, and outperformed the project team in controlling cost. Implications for managing development projects are briefly discussed
Interdepartmental integration: a definition with implications for product development performance Nieuwe technologieeÈ n en organisa-torische maatregelen. De praktijk van flexibele fabricage systemen, Thesis. The Netherlands
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Organising Innovative Manufacturing Systems Organising for market-oriented manufacture, paper POMS Conference Product develop-ment: past research, present findings and future directions
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Boer, H. (1991) Organising Innovative Manufacturing Systems. Aldershot: GoweraAvebury.
Nieuwe technologieeÈ n en organisatorische maatregelen. De praktijk van flexibele fabricage systemen
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Krabbendam, J.J. (1988) Nieuwe technologieeÈ n en organisatorische maatregelen. De praktijk van flexibele fabricage systemen, Thesis. The Netherlands. University of Twente, Enschede (in Dutch).
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Hulshof, A.H. (1982) Organisatiekunde. Enschede, The Netherlands: University of Twente (in Dutch).