No full-text available
To read the full-text of this research,
you can request a copy directly from the author.
Product Development In The World Auto Industry: Strategy. Organization and Performance
... Several researchers attempted to predict the performance of the iteration process using analytical models (Chen and Xiao, 2014;Jun et al., 2005;Smith and Eppinger, 1997), while others using simulation models (Hossain and Chua, 2009;Maier et al., 2014;Wynn et al., 2007;Yang et al., 2014). Both these models assume that the possibility and amount of iterations are determined by the probability of rework, and the PDP is the information-processing process (Hultink, 1994). However, iteration is different from rework according to Unger and Eppinger (2009) and Leo´n et al. (2013), because it includes both the rework to compensate for development defects or cope with changes and the normal work to achieve the goals that have not been achieved. ...
... Hu et al. (2003) proposed an information-constraint-driven execution plan semantics to handle the concurrency. As the PDP can be seen as the information-processing process (Hultink, 1994), the activity can also be seen as an information-processing unit that receives information from other activities and transforms its new information to others (Lin et al., 2008). So, the process effectiveness of activity can also be regarded as the maturity degree of the activity's output information. ...
The appropriate iteration process model is the basis for managing and optimizing the product development process. In this article, we attempt to introduce the concept of process effectiveness and process value. The relationship between rework probability and process effectiveness is discussed. The evolution function of process effectiveness is proposed to drive the overlapped iteration process of multi-coupled activities. The evolution process with input information update is studied, and a simulation model is presented to obtain the accurate iteration process of development. It is useful to analyze the risks during development, and has good flexibility and versatility. The calculation method of process value for overlapped iteration process is given, and an optimization model for product development process is provided. The model is used to improve the development process of the stamping die of a car roof. With the model, we can get a suitable overlapping rate of multi-coupled activities to improve development performance.
... The quality-based philosophy inherent in a TQM implementation does not exploit the non-quality dimensions present in today's complex product design, development, and delivery (PD 3 ) environment (Besterfield et.al., 1995). The competitors are always finding better and faster ways of designing and developing products (Clark and Fujimoto, 1991). Catching up in quality-oriented programs has not been enough to be a world-class leader in manufacturing (Heim and Compton, 1992). ...
... The following are some typical DFQ objectives: • The tolerance range can be increased by applying DFQ techniques to increase the design latitude. Anticipate possible quality problems during early phases of product design and prevent them from occurring by implementing error-proofing techniques that could assure correct outcomes (Clark and Fujimoto, 1991). • The manufacturing variability can be decreased by applying DFQ to the manufacturing processes (Ross, 1988). ...
It has not been enough to include “quality dimensions” into a product or a service and expect the outcome to be world-class. Total value signifies a set of multidimensional measures towards realizing a competitive product (goods or services) that the customers would like and are willing to pay a premium price for. A “quality dimensions” set is one of its (total value) multidimensional measures. Such multidimensional value considerations would be vital for a company in maintaining a competitive edge in today’s
global and rapidly changing marketplace. The first question is why a “quality dimensions” set has not been
enough? The second question is what are those multidimensional sets of measures that make-up this total value content? The last question is how to determine a cumulative total value-index that accounts for these sets of measures so that an organization could use this total value-index to optimize its product realization process and thereby control its (an organization’s) degree of competitiveness. The paper attempts to answer these questions.
... Yet subassemblies require suppliers with a modicum of development capabilities, adding in turn to the fixed costs. Such capabilities are particularly attractive to carmakers when they involve outsourcing even more than the production function alone (i.e. the detailed design of subassemblies/components). The aim was to reduce the volume of fixed assets but above all to cut new car projects' time-to-market at a time when Western carmakers were not doing nearly as well as their Japanese counterparts (Clark, Fujimoto, 1991; Womack, Jone, Roos, 1990). The end result was a rapid decline in direct suppliers between 1986 and 1996 (Table 1). ...
... This contrast was developed in system integrator studies demonstrating the inappropriateness of this simplified scheme for the complex products found in many industries (Prencipe, Davies, Hobday, 2003). As the systems product par excellence (Clark, Fujimoto, 1991), the automobile belongs to this category (Sako, 2003; Takeishi, Fujimoto, 2003). ...
This article questions a terminology that is frequently used to describe automotive supply chains’ industrial architecture. Since vertical disintegration became a trend in the 1980s, this architecture has been represented using the image of the pyramid. Implicitly, authors have had the image of an Egyptian pyramid in mind, one that is pointed at the top and broad at the base. We will demonstrate that even if pyramids are an appropriate image, in the auto industry the Aztec variant, with its shortened peak and room for SMEs, is more accurate. The paper’s first section – with its more historical focus – explains the birth of the Egyptian pyramid. The section 2 puts forward the idea that the Egyptian metaphor is more misleading than informative. We start by demonstrating that overusing this metaphor will ultimately exclude a number of very strategic companies from analysis. This is followed by a presentation of the findings from a study of 750 French SMEs*, in which it is demonstrated both that some continue to maintain direct access to carmakers and also that the hierarchy of tiers comprising this supply chain features greater porosity than is commonly recognized.
... In studies of the automobile industry, the role of product development for superior performance has been pointed out by several studies (Clark and Fujimoto 1991, MacDuffie, Sethuraman and Fisher 1996). Key performance parameters in automotive product development are: development lead time, product quality and productivity, which have been shown by Clark and Fujimoto (1991) to depend critically on superior capabilities in integrated engineering problem solving, and manufacturing efficiency (just in time and the lean manufacturing paradigm). ...
... In studies of the automobile industry, the role of product development for superior performance has been pointed out by several studies (Clark and Fujimoto 1991, MacDuffie, Sethuraman and Fisher 1996). Key performance parameters in automotive product development are: development lead time, product quality and productivity, which have been shown by Clark and Fujimoto (1991) to depend critically on superior capabilities in integrated engineering problem solving, and manufacturing efficiency (just in time and the lean manufacturing paradigm). The role of process development figures less prominently in the literature. ...
This study aims at a better understanding of how firms arrange and profit from their technological competencies. In particular, it presents a contribution to the diversification-performance literature by dealing with a still poorly researched aspect of diversification, namely technological diversification, while controlling for market diversification. Results suggest that firms that concentrate their technology assets in coherent groups outperform those that distribute their technology endowments across less related areas. The research also contributes to the literature on firm heterogeneity by focusing and exploring a single industry, automotive suppliers in the U.S. By working in one sector, it avoids the complications inherent in inter-industry cross-sectional analysis, while recognizing that firms make their strategy decisions within a single-industry, where most of their resources are concentrated.
... The new strategy also allows Ford to reduce the number of suppliers and increase their participation in engineering design of cars. Such cooperation not only reduces the cost of producing cars but also increases the quality of the resulting cars (Clark and Fujimoto, 1991). Ford estimated that it would be able to save as much as $3 billion in cost per year by 2000 with $11 billion between 1996 and 2000 (Naughton, 1996). ...
... With one executive responsible for concept, design, development and engineering, the company effectively has a so-called heavyweight project manager. And having a heavyweight project manager in automobile development can reduce lead times, total engineering hours (and therefore cost, all else equal) and improve design quality (Clark and Fujumoto, 1991). At Ford, it used to take 22 meetings and over two months to get a newcar project approved. ...
??? In consolidating its North American and European product development into five Vehicle Program Centers (VPCs) to develop cars for all markets, integrating its manufacturing, supply, marketing and sales into a worldwide operation, Ford is moving from a so-called multi-domestic strategy to a global one. ??? The question is if this is the right strategy for an automobile company that wants to offer new low cost and/or differentiated products to its customers worldwide. ??? This article advances three points: ??? First, that although the strategic change is appropriate, it may not have gone far enough. ??? Second, to get the best out of the strategy, in any case, Ford must implement it well, moulding the right organizational structure, systems/processes, and the right people in the right positions. ??? Third, it must integrate into its systems, the right information and communications technologies. Optimal performance requires a fit between strategy, structure, systems/processes and people. ?? 1997 John Wiley & Sons, Ltd.
... Overlapping occurs when a downstream task is started before completing upstream tasks. In general, the advantage of overlapping has been recognized in several studies [4] [11] [12] [13]. Clark and Fujimoto [11] suggest that optimal overlapping may depend on organizational characteristics and effective communication. ...
... In general, the advantage of overlapping has been recognized in several studies [4] [11] [12] [13]. Clark and Fujimoto [11] suggest that optimal overlapping may depend on organizational characteristics and effective communication. Overlapping might identify design flaws [12], but may allow accidental omission of key steps [6] and may introduce uncertainties which can increase iterations [7]. ...
Testing components, prototypes and products comprise essential, but time consuming activities throughout the product development process particularly for complex iteratively designed products. To reduce product development time, testing and design processes are often overlapped. A key research question is how this overlapping can be planned and managed to minimise risks and costs. The first part of this research study investigates how a case study company plans testing and design processes and how they manage these overlaps. The second part of the study proposes a significant modification to the existing process configuration for design and testing, which explicitly identifies virtual testing, that is an extension to Computer Aided Engineering which mirrors the testing process through product modelling and simulation, as a distinct and significant activity used to (a) enhance and (b) replace some physical tests. The analysis shows how virtual testing can mediate information flows between overlapping (re)design and physical tests. The effects of virtual testing to support overlap of test and (re)design is analysed for the development phases of diesel engine design at a case study company. We assess the costs and risks of overlaps and their amelioration through targeted virtual testing. Finally, using the analysis of the complex interactions between (re)design, physical and virtual testing, and the scope for replacing physical with virtual testing is examined.
... Clark and Fujimoto (1989b) recognized the coordination difficulty for overlapped and distributed product development process. To facilitate overlapping, they recommended frequent and face-to-face communication between teams to exchange critical information (Clark and Fujimoto 1991). However collocated cooperation may be not easy for distributed projects. ...
... We follow the information-based view of product development (Clark and Fujimoto 1991) in which individual development activities are viewed as the information-processing units that receive information from their preceding activities and transform it into new information to be passed on to subsequent activities. Figure 1 shows the information transformation between two development phases. ...
Market and technology changes have brought about new characteristics of product development. One of the most significant changes from the traditional to the new paradigm is the change from sequential and collocated product development process to overlapped and distributed process. This paper explores the appropriate overlapping policy in distributed product development. Firstly we developed a system dynamics model for overlapped product development in which upstream evolution, downstream sensitivity, and resource constraints are explicitly simulated. Then the analysis is done based on the model and the data from a mobile phone development project. The simulation results show that it is very dangerous for a company to develop innovative products with distributed teams. Not only coordination difficulty but also wrong overlapping policy makes delay unavoidable for the distributed and highly innovative projects. The simulation results are empirically proven by our experience in the consumer electronics companies and previous literature.
... A second indirect effect is reached by using KMTs to improve innovation-related drivers of profits, e.g. product and service performance [16] [17] [18] or the speed to market performance [19] [20]. Although the literature presents extensive research showing a positive relationship between innovative capabilities and financial performances and between KMT usage and innovation capabilities (e.g., [12] [13]), there is a dearth of studies that test both the direct and the indirect impact of KMTs on financial outcomes through the mediation of innovation-related variables. ...
... Consistent with the previous literature (e.g. [19] [20]) we refer to speed to market as the ability to develop and launch in the market new products with lower lead times and fast responses to the market. We measured speed to market using three items (Cronbach's α = 0.83, EVI = 0.62, CRI = 0.83). ...
The business value of information technology is an enduring research question. This research provides new insights to better understand the mechanisms supporting this relation by analyzing the impact of knowledge management tools (KMTs) on the performances of business units involved in inter-firm collaborative innovation projects. We extend current literature by developing and empirically testing a model where: (1) the use of KMTs is affected by critical organizational variables, (2) KMTs can impact the innovation and financial performances of business units. We find that mutual trust and culture for change do not affect the extent of the use of KMTs, while collaborative experience and naturalness in using ICTs as substitutive of face-to-face contacts have a significant impact. Moreover, we show that a more intense use of KMTs has a direct positive effect on new product performance and speed to market, as well as on financial performance. Yet, only new product performance acts as an indirect conduit linking KMT use and financial performances. This article provides a discussion and perspectives of further research concerning the impact of KMTs on innovation practices in inter-firm collaborative environments.
... Loasby noted, an organizational structure " ... not only determines where an organization's problems are worked on, but also helps to determine what problems they shall be, how they are defined, and what solutions will be attempted " (1976: 133). Thus, Clark and Fujimoto (1991) pointed out that building integrating mechanisms, such as stage-overlapping product development processes and embedding these organizationally would facilitate rich communications across departments. Other developments from the strategy and organization literatures may be mentioned, such as the recent proliferation of ideas on strategic alliances as vehicles for knowledge-building (Mowery, Oxley and Silverman, 1996), of high-performance HRM practices as driving innovation performance (Laursen and Foss, 2003), and on the " differentiated MNC " as a means of superior leverage of knowledge (Hedlund, 1994). ...
Knowledge governance is characterised as a distinctive research subject, the understanding of which cuts across diverse fields in management. In particular, it represents an intersection of knowledge management, strategic management, and theories of the firm. Knowledge governance considers how deployment of governance mechanisms influences knowledge processes: sharing, retaining and creating knowledge. We survey the papers in this volume of the special issue, and discuss the remaining research challenges.
... Several definitions are found in the literature for the PDP. Among them, PDP is "a process by which an organization transforms the information of market opportunities and technological possibilities in advantageous information to manufacture a product" [12]. Or yet, PDP "is the process that converts customer needs and requirements into information for a product or technical system can be produced" [13]. ...
This paper, through a wide approach of Product Development Process (PDP) renowned
methodologies, proposes a conceptual model to serve as a guide in the elaboration, management and
implementation of research and development (R&D) projects classified by the R&D Program of
Brazilian Electricity Sector which is regulated by the Brazilian Electricity Regulatory Agency
(ANEEL). Product development methodologies can be applied to narrow the relationship between
academy and industry ensuring results directed to the product, with reduction of costs and
development time better suited to the customers needs, fulfilling integrally, at the same time, the
Innovation Chain proposed by ANEEL R&D Program in the achievement of new technologies for
the electricity sector.
... This necessarily requires engineering design methods and tools as Blanchard [9] describes it with special reference to its integration in process simulation. The embedded process was generally described by Clark, Fujimoto [10] by regarding four major stages of development: concept development, product planning, product engineering , and process engineering as well as the critical linkages within and across them. The special feature of SeJu is that the process just described is duplicated and connected in parallel in terms of running the product and business development at the same time are taken into account the critical linkages [11] ...
Design is communication. In a traditional sense of design theory this idea is based on a product related perspective, stating that good design must speak a language that is understood by the recipient. The aesthetics of the design catches his interest and opens his mind as a prerequisite for his willingness to enter into a dialogue. From symbols and images an argument is derived, rationally understandable, convincing and finally condensed in a message. This process is triggered by the product design. It communicates a value proposition for the recipient combined with a demand to buy the product it refers to. At the moment of the purchase decision a transformation takes place and the value proposition turns into a benefit, the design into the product utility and the recipient into a customer. It will be argued that this process retains its validity even if communication itself is considered as a product.
... In the automotive industry, vehicle development lead time has a direct impact on the company's profits. For example, the delay in introducing a $10,000 small car to the market is estimated to cost at least one million dollars per day in lost profits [2]. In order to reduce lead time, the Vehicle Development Process(VDP) in the automotive industry has been shifted from sequential-functional to concurrent-team based approach. ...
... However, an extensive black-box approach may lead to decreasing ownership and in-house knowledge by OEMs. External product development may lead to concept leakage to competitors as well [17]. As seen in the case companies, by degree of involvement and frequency of communication between them and the customer, it is reasonable to conclude that their relationship , based on the above definitions, produces grey-box rather than black-box products. ...
This paper examines the innovation process in four Norwegian companies, all supplying the automotive industry with light weight structural components. Twelve representative product projects are categorized, together with people from product development in respective companies, according to product and process novelty. The main contribution from this study is twofold; first, a new framework and index for categorizing innovation across product and process newness is developed, second, putting empirical data into the framework demonstrates that product and process uniqueness does not seem to be dependent on amount of resources.
... In addition, R&D services may provide indirect advantages and profits for the manufacturer. Particularly in an integrated solution business, customer expectations for customization enable manufacturers to price R&D services and to create profitable revenues through the application of R&D capabilities (Clark & Fujimoto, 1991; Narver, Slater, & MacLachlan, 2004; Stump et al., 2002; Ulaga & Eggert, 2006). Priced R&D services enable the manufacturer to use resources for customization and to create customer value in terms of solutions that better fit the customer's needs. ...
... In the product development context, knowledge generation is based on the development of problemsolving activities that involve problem recognition, knowledge application to solve problems, and further generation of new knowledge for developing and launching new products (Iansiti and Clark, 1994). Knowledge integration involves that people belonging to different firm departments work together combining varied knowledge and skills in order to design and develop a specific product (Clark and Fujimoto, 1991). It is thus necessary a cross-functional knowledge integration perspective as a key aspect of product development. ...
This paper contributes to the clarification of the connections between knowledge management and dynamic capabilities in the context of product development to see how they explain product development competences. Building on the knowledge management and dynamic capabilities literatures, the paper argues that the social side of knowledge management has a role to play as enabler of dynamic capabilities in the context of product development. Further, dynamic capabilities shape product development competences. Empirical evidence is provided by performing survey research with data collected from 80 product development projects developed in Spain. The paper includes conclusions, limitations and future research potentials for those with an interest in supporting dynamic capabilities.
... " Then, working across corporate boundaries to co-create and develop products and customer solutions is becoming a critical aspect of product development in a wide range of industries (Deck 2004). Consider also that not only is product development becoming more important to organizations, but it is also becoming complex (Clark and Fujimoto 1991; Brusoni 2005). Also, given a short product life cycle and because of limited internal competencies, a company may increase its options by iteratively co-developing products with supply chain partners. ...
This paper is about the way diverse companies come to create and develop innovation
together, with the aim of accomplishing a certain degree of radicalness. On the basis of the knowlegde about the likelihoods of accomplishing a certain innovation, the knowledge about the nature of the outcomes, and the time frames, a theoretical framework has been advanced. Two dimensions have been contrasted: the non-spatial proximity characteristics of the partners involved into the collaboration setting, and the collaboration strategy. The nature of the innovation accomplished was meant to be incremental or radical in terms of its antecedents (nature of knowledge required) and consequences (impact). A typology of innovation paths resulted from the model. The framework contributes to understanding the primary and controversial role of diversity in order to make managers aware of the profound implications that such a strategic setting will bring when collaborations are to be planned.
... For example, a high degree of social interaction and team building across organizational units may be counterproductive if the main desire is to create original ideas. Yet, as other research has shown, such interaction may be useful if engineering and production personnel are to collaborate on product development (see Clark and Fujimoto, 1991). Although such skill-sets are not part of current management hiring criteria, knowledge-based companies that are able to successfully incorporate different scenarios and interactional outcomes in knowledge transfer (represented in Figures 1 and 2) may gain a competitive advantage and optimize their resources. ...
Dominant research streams in the knowledge transfer field, such as the positivist and social constructionist approaches, largely assume that knowledge transfer is accomplished through instructions and/or socially constructed practices. Underlying these views is the belief that texts and practices carry with them the codes necessary for their own decoding and therefore enable an unproblematic knowledge transfer. In contrast, we argue that the decoding of information into meaningful knowledge is always mediated by people's private and cultural models, which are created from the unique combination of their cognitive dispositions (i.e. acumen, memory, creativity, volitions, emotions) and socio-cultural interaction. The degree to which people apply these models reflectively and/or categorically (i.e. automatically) depends on the need for cognition as well as environmental demands and feedback. Therefore, knowledge transfer is always tentative, because it depends on the application of private and cultural models along the continuum that goes from reflective to categorical processing. We present first a critique of the positivist and social constructionist positions; then we introduce a socio-cognitive model that captures and explicates socio-cognitive processes involved in sense making during knowledge transfer. Finally, we explore future research streams and managerial implications.
... For example, a high degree of social interaction and team building across organizational units may be counterproductive if the main desire is to create original ideas. Yet, as other research has shown, such interaction may be useful if engineering and production personnel are to collaborate on product development (see Clark and Fujimoto, 1991). Although such skill-sets are not part of current management hiring criteria, knowledge-based companies that are able to successfully incorporate different scenarios and interactional outcomes in knowledge transfer (represented in Figures 1 and 2) may gain a competitive advantage and optimize their resources. ...
Dominant research streams in the knowledge transfer field, such as the positivist and social constructionist approaches, largely assume that knowledge transfer is accomplished through instructions and/or socially constructed practices. Underlying these views is the belief that texts and practices carry with them the codes necessary for their own decoding and therefore enable an unproblematic knowledge transfer. In contrast, we argue that the decoding of information into meaningful knowledge is always mediated by people's private and cultural models, which are created from the unique combination of their cognitive dispositions (i.e. acumen, memory, creativity, volitions, emotions) and socio-cultural interaction. The degree to which people apply these models reflectively and/or categorically (i.e. automatically) depends on the need for cognition as well as environmental demands and feedback. Therefore, knowledge transfer is always tentative, because it depends on the application of private and cultural models along the continuum that goes from reflective to categorical processing. We present first a critique of the positivist and social constructionist positions; then we introduce a socio-cognitive model that captures and explicates socio-cognitive processes involved in sense making during knowledge transfer. Finally, we explore future research streams and managerial implications.
... This study is motivated by a need to better understand the Manufacturing Engineering role and manufacturing method planning within Concurrent Engineering. Issues impacting Concurrent Engineering effectiveness include a 'hostile' downstream attitude to receiving unfinished design work that is likely to be changed, and the willingness of upstream and downstream parties to make agreement when determining a design [4]. By applying value stream mapping and analysis, this study seeks to understand the practices that enable such unfinished work to be used in NPI processes for planning the manufacturing method in the context of a large aerospace project. ...
This paper presents an investigation of current state practice of the Manufacturing Engineering discipline for concurrent
manufacturing planning. The research adopted a case study approach and has been conducted at a globally operating manufacturer
of aerospace products. The investigation establishes how information systems and the cross-functional teaming enable integrated
processes for planning the manufacturing method to progress simultaneously with design in a lean and efficient manner. It
applies value stream analysis to understand where value and non-value is added in these transactional processes.
... Inspired by the many writings on matrix management and the role of organizational structure, project management researchers became aware of the organizational context to explain project management success and failure (e.g., [34]). The contributions of Clark and Fujimoto [9] and Clark and Wheelwright [10] also contributed to this knowledge domain, pointing to the importance of the project dimension when configuring organizational structures. In recent years, the scope of project-oriented research has become even wider. ...
In recent years, we have witnessed an increased interest in the research on projects and project management. The aim of this article is to review, classify and analyze the recent contributions within the field. This paper is based on two sets of data: (1) project-related research published in major management and organization scientific journals, and (2) articles published between 1993 and 2002 in the International Journal of Project Management. The article offers a framework suitable for analyzing the developments made and the different perspectives launched. It is submitted that “project research” instead of project management research might be a better concept for capturing the current state of the field. We also show that papers in the International Journal of Project Management have devoted little attention to research on contexts of multi-projects and multi-firms, a context that is considered to be of great importance for the future of project studies. The recent developments illustrate the need to better integrate project management with the general developments in management and organization. Of special importance, we conclude, is the one that we label project ecologies. We also believe that this concept, and research focus, might be of value for practitioners as it describes the way many modern industries work. The paper contributes to the internal debate about the content and identity of project research.
... Findings in the literature support the claim that human communication is a critical factor for efficient collaboration at interfaces in the design process (Wallace 1990, Badke-Schaub and Frankenberger 1999a, Hales 2000), such as between the departments of embodiment design and simulation. Moreover, empirical studies of product development going back over 30 years have supported this emphasis by correlating integrating practices and superior performance (Allen 1977, Clark and Fujimoto 1991, Hoopes and Postrel 1999). Busseri and Palmer (2000, p. 230) suggest regular (self-)assessments of the way teams function as help to improve team performance. ...
The need for integration of computer-aided design and computer-aided engineering environments stems from the business priority to reduce product cycle times. It is exacerbated by the coexistence of two different paradigms: a topological one in embodiment design and a functional one in simulation. This dualism places increasing demands on human communication between design and simulation engineers. This paper claims that reflecting communication is a key factor for successful collaboration. Reflection is used in both senses of the Latin word ‘reflectare’: to trigger active thinking about and consideration of communication, as well as to mirror perceptions of a given situation by people collaborating. The paper reports on the development and application of a maturity-grid approach to diagnose the current and desired states of communication between design engineers and simulation engineers in the car body development of a German automotive manufacturer. Results include three themes: one, the importance of understanding of the collaborators’ information needs; two, the importance of orientation, e.g., indicated by the engineers’ overview of sequence of tasks in the design process; and three, the importance of reflection.
... Succeeding in the competitive and complex market arena with such products, which must profit from economies of scale and respond to diverse customer, business, and cultural environments, calls not only for resources and capabilities but also for a global new product development (NPD) strategy to effectively tackle these challenges [4] [5] [6]. Effective design and development of new products have a significant impact on cost, quality, customer satisfaction, and competitive advantage [7]. Moreover, innovation has long been crucial to achieving organizational success in the market, and is an important field of research. ...
Assessing performance in developing new aerospace products is essential. However, choosing an accurate set of success indicators to measure the performance of complex products is a nontrivial task. Moreover, the most useful success indicators can change over the life of the product; therefore, different metrics need to be used at different phases of the product lifecycle (PLC). This paper describes the research undertaken to determine success measurement metrics for new product development (NPD) processes. The goal of this research was to ascertain an appropriate set of metrics used by aerospace companies for assessing success during different phases of the PLC. Furthermore, an evaluation of the differences and similarities of NPD success measurement was carried out between aerospace companies and the nonaerospace companies practicing in the business-to-business (B2B) market. Practical case studies were carried out for 16 Canadian and Danish companies. Seven companies belong to the aerospace sector, while nine are nonaerospace companies that are in the B2B market. The data were gathered from relevant product managers at participating companies. The outcomes of this research indicate that: (1) the measurement of success of aerospace NPD practices depends on the PLC phase being measured, (2) product and process management performance are the more important indicators of success in the early PLC phases with revenue and market share indicators being important during late phases, and (3) there are reasonable similarities in success measurement between aerospace and nonaerospace B2B companies. Sets of metrics for measuring success during each PLC phase of aerospace products are proposed, which can guide companies in determining their ideal practices.
... The research areas of organizational strategy have concerned with the dynamics of generating and dissolving networks. Types of resources which bring the competitive edge have been discussed [10] and ways to generating the types of resources have been illustrated [11]. As a result, some important ideas such as Knowledge Creation [12] and Learning Organization [13] were established where alliances and networks play a key role as resources of the competitive edge [14]-[17]. ...
This paper proposes an analytical method for the dynamics of generating firms' alliance networks along with business phases. Dynamics in network developments have previously been discussed in the research areas of organizational strategy rather than in the areas of regional cluster, where the static properties of the networks are often discussed. The analytical method introduces the concept of business phases into innovation processes and uses relationships called prior experiences; this idea was developed in organizational strategy to investigate the state of networks from the viewpoints of tradeoffs between link stabilization and node exploration. This paper also discusses the results of the analytical method using five cases of the network developments of firms. The idea of Embeddedness helps interpret the backgrounds of the analytical results. The analytical method is useful for policymakers of regional clusters to establish concrete evaluation targets and a viewpoint for comparisons of policy programs.
... By so doing, they have transposed the notion of modularity to the automotive sphere. After all, the automobile remains a deeply systemic product (Clark, Fujimoto, 1991; Takeishi, Fujimoto, 2003), meaning that the concept of modularisation can only be transferred to this sphere via the intermediary of macro-components (Volpato, 2004) if large suppliers play an active role (Sako, 2003; Fourcade, Midler, 2005). ...
The purpose of this paper is to present factual elements concerning the rise (decline) of French mega-suppliers. The study will focus on France’s three main mega-suppliers, all actors that have had a stake in carmakers’ modularisation strategies: Faurecia, Plastic Omnium and Valeo. Section 1 returns to the late 1980s and shows that the emergence of today’s mega-suppliers is rooted in this era and was piloted by French carmakers. Section 2 positions French mega-suppliers in a global hierarchy and distinguishes between two varieties: suppliers of simple parts; and module suppliers, with the latter constituting the focus for the rest of this text. Section 3 shows how module suppliers’ rise is rooted in their aggressive mergers and acquisitions (M&A) strategies. It also demonstrates differences between suppliers in terms of the two leading acquisition strategies that were observed. Section 4 explains why these companies’ profitability continues to disappoint, developing the idea that modular strategies imply a big rise in fixed costs, something that suppliers cannot knock onto sales prices. Finally, section 5 returns to companies’ internationalisation strategies and offers a typology for the different entities that mega-suppliers consolidate
... Team-based work has been argued to increase the speed of product innovation (Hayes, Wheelwright, and Clark 1988), the number of innovations (Dougherty 1992), and the value of the innovation (Ven de Ven 1986). For example, Clark and Fujimoto (1991) conducted a qualitative study where they found that the use of cross-functional teams is central to the product development process . Additionally, effective product development was not housed in solely specialized R&D activities; instead, the most effective product development came from creating linkages between various departments within the organization . ...
Face à la montée en puissance des enjeux liés au développement durable, l'industrie a peu à peu intégré la dimension environnementale dans la conception de produits avec la démarche d'éco-conception. Dans le même temps, ce processus a évolué, puisque d'une activité réalisée majoritairement en interne à l'entreprise, elle implique dorénavant de multiples parties prenantes intégrées dès les phases amont. Si les outils et méthodes d'éco-conception développés ces dernières années ont permis d'intégrer partiellement la dimension environnementale en interne à l'entreprise, l'élargissement des acteurs prenant part au développement des produits introduit une nouvelle strate de complexité. L'intégration de la dimension environnementale lors d'un processus de conception externalisé se confronte ainsi à une discontinuité méthodologique, liée à une différence de maturité entre les différents acteurs de la chaîne de sous-traitance. L'objectif de ce travail de recherche est d'abord d'étudier les approches actuelles permettant d'intégrer la dimension environnementale à chaque niveau de la chaîne de sous-traitance. Il s'agit par la suite d'identifier les facteurs à l'origine cette discontinuité. Nous en déduirons des mécanismes pouvant permettre, dans ce contexte, une meilleure intégration de la dimension environnementale.
Following the current pace, in which technological innovations, increased market demands, and other characteristics have provided companies with more agile production, is indeed a challenge. Thus, the product development process has become dangerous as it skips crucial steps to the detriment of putting products in the market sooner. Product development methods are a way to determine the necessary steps to design a product. One of the most known methods is that developed by Gerhard Pahl and Wolfgang Beitz, who belong to the semantic school of design. This method is analyzed in this research, and improvements that can be made to provide higher safety to the products developed are proposed. At last, 11 improvement proposals were presented for the studied method followed by explanations and justifications based on the literature on this subject.
A common perspective is that consistent R&D investment facilitates innovation, while volatile spending implies myopic decision making. However, the benefits to exploiting extant competencies eventually erode, so firms must disrupt their R&D function and explore for new competitive advantage. We suggest that high-performing firms recognize when extant competencies decline and increase exploratory R&D to develop new competencies at the appropriate time. We find that changes in R&D expenditure away from the firm's historic trend, in either direction, are indicative of transitions between exploitative and exploratory R&D and are associated with increased firm performance. Increases in R&D expenditure above the trend are associated with an increased likelihood of highly cited patents, suggesting that firms are making the leap between R&D-based exploitation and exploration. Copyright © 2013 John Wiley & Sons, Ltd.
Teams have emerged as a pivotal form for organizing science efforts. Team goals and issues such as goal alignment are generally considered to be essential to team success. However, given the interdisciplinary and pluralistic goals associated with translational science, team goals become a challenging area for studies that cannot be reconciled without attention to the broader institutional contexts of translational teams. In this commentary, we draw attention to how different goals in team science can be rooted in the broader institutional context and associated logics of action. For the science of team science (SciTS) to impact practice, it is imperative that we be clear about the logic of team goals and their relation to preferred patterns of organizing. We conclude with a reflection on how contextual issues should be at the foreground of SciTS along with the other important issues of team science.
Abernathy's (1978) empirical work on the automotive industry investigated relationships among an organization’s boundary (all manufacturing plants), its organizational design (fluid vs. specific), and its ability to execute product and/or process innovations. Abernathy's ideas of dominant designs and the locus of innovation have been central to scholars of innovation, R&D, and strategic management. Similarly, building on March and Simon's (1958) concept of organizations as decision making systems, Woodward (1965), Burns and Stalker (1966), and Lawrence and Lorsch (1967) examined relationships among organizational boundaries, organization structure, and innovation in a set of industries that varied by technology and environmental uncertainty. These and other early empirical works have led a diverse group of scholars to develop theories about firm boundaries, organization design, and the ability to innovate.
J.-C. Spender’s award-winning, knowledge-based theory of the firm is based on four premises: (1) The firm can be sufficiently understood as a system of knowledge, (2) explicit and implicit knowing can be clearly dissociated, (3) organizations are conceived as cognizing entities, and (4) intuition shaped by shared cultural practices is a superior source of managerial knowledge. This line of reasoning represents a social constructionist view of the enactment, transfer, and storage of knowledge according to which managerial knowledge is largely tacitly shaped by industry recipes and the firm’s socio-cultural conventions and other social processes. Although comprehensive in scope, we argue that a knowledge-based theory of the firm needs to integrate a cognitivist approach that includes the synergetic production of tacit and explicit knowledge, the role of reflective thinking in resolving strategic uncertainties, and the interaction between the individual and the social. This socio-cognitive theory of the firm posits that sustained competitive advantage of a firm is founded on the ability to align knowledge internally within the firm as well as externally with its stakeholders through the individual sense-making of feedback from other individuals.
This paper conducts preliminary analysis on technological innovation by using prize and award data sets: the Okouchi Prizes and the R&D 100 Awards. It aims to outline longitudinal patterns of award-winning industries, organizational type, and inter-organizational collaboration. First, it shows that most awards in the 1960s were given in the area of electric appliances. The iron and steel industry was the second leading prize winner of the Okouchi Prizes. Meanwhile, the segment of transportation equipment, one of the Japan’s leading industries, fared poorly. Looking at the R&D 100 Awards, this segment’s presence has increased in Japan, while it has decreased in the U.S. since the 1970s. Lastly, the inter-organizational collaboration ratio was higher in Japan than in the U.S. until the 1980s. However, the U.S. showed an increase in the collaboration ratio starting in the 1980s, when the ratio dramatically dropped in Japan.
This paper discusses why companies should consider collaboration with customers and suppliers for innovation and identifies a set of activities that appear to be critical to managing collaborative innovation. It conceptualise s how these activities may be affected when performed in complex networks, thus complicating the task of trying to manage them effectively. The paper reports on findings from a small set of exploratory interviews and discusses some possible explanations for apparent cross-case differences. A note on methodological and theoretical lessons completes the paper.
Changes occur at all stages in the product life. This paper presents a methodology to support designers managing changes through the entire life- cycle of a system, by providing them with a means of assessing potential knock-on changes across a system using a series of related product connectivity models. It is centred on the use of the risk-based Change Prediction Method (CPM), which is extended beyond its original use in the design stage of product development to cover all life-stages of a system. Conceptual design is supported by helping designers identify areas in a system that are highly susceptible to change and evaluate solution alternatives. During detail design, this methodology facilitates design freeze planning. Operational life-stages are supported through predicting knock-on effects of environmental changes and upgrades.
Innovation generation has increasingly been recognized as an outcome of interaction between a firm and various outside entities.
According to this view, supplier involvement and alliances are routes to innovation generation. Despite this realization,
there is a dearth of research, both conceptual and empirical, focusing on innovation generation in buyer-seller relationships
in supply chains. In an attempt to fill this void, this article develops a conceptual model of innovation generation in buyer-seller
relationships in upstream supply chains. The authors propose that innovation generation in supply chain relationships, both
incremental and radical, is a consequence of interactions between buyers and sellers. They also delineate factors internal
and external to the relationship that moderate the link between interaction and innovation generation. Finally, the authors
discuss managerial implications of their research and offer guidelines for future empirical research.
The idea of iteration is inherent to systems analysis and design methodologies and practices. In this essay we explore the notion of iteration, and distinguish two dimensions of iteration: iterations inherent in cognitive processes and iterations over representational artifacts. Cognitive iterations can be concerned with the design; the design process; or stages within the design process. Representational artifacts can take the form of documentation or the software code itself. We identify and discuss the promise of âÄúiterative developmentâÄù and compare this promise to empirical findings on the effects of iterative methods. The findings are generally consistent with expected outcomes. We conclude with an observation that the difference between âÄúiterative developmentâÄù and more traditional methodologies lies not in the presence of iteration, but in the locus of visibility and control, and the associated timing and granularity.
Projects play key roles in most modern industries and firms. The management of these economic activities, project management, is continuously developed and today considered to be at the center of competitive advantage. Much classic research on project management has, however, focused on the planning and scheduling activities of project management. Traditional writings within the area even seem to treat project management as a discipline of planning or an application of systems analysis. Much of this work, however, falls short on empirical grounds and has not studied project management practice in any further detail. This paper, on the other hand, takes its starting point in two in-depth case studies and one ethnography of the management of product development projects. Based on these empirical observations, we elaborate on a framework for the analysis of project management work where two perspectives are put at the fore; knowledge perspective and time perspective. From these perspectives, we discuss different roles that project management has in a product development context.
Due to increasing globalization and technological discontinuities, firms strive to develop new product capabilities and flexibilities by engaging in outsourcing activities and adopting modular systems. However, these strategies contain risks of opportunistic expropriation of tacit knowledge and costs related to monitoring sourcing partners who are geographically and culturally distant. This study examines the antecedents of control mechanisms through which firms manage the risks and costs associated with outsourcing relationships in global technology-intensive markets. Modularity in design is hypothesized as a moderator of model relationships because it can serve as a substitute for formal or informal controls in a “controls portfolio”.
Changes are the main causes of delays and cost overruns in construction projects. Various change management systems have been developed to minimize the impacts of changes and to facilitate good project management. This paper presents a change prediction system using activity-based dependency structure matrix (DSM) to facilitate change management. DSM is used to model the process that may occur as a result of changes. Consequently changes can be predicted by setting the change criteria for each activity in the form of rework scope. Furthermore, Monte Carlo simulation is introduced to analyze the change probability of activities involved in construction projects. The effectiveness of the prediction system is verified by applying this system to an office building project. This study provides a useful tool for project management teams to manage changes proactively and efficiently.
Do investors in the stock market care about companies' product design when making investment decisions? The dissertation at hand sheds light on this question by studying how investors' subjective evaluations of a company's products influence their willingness to invest in the company's stock. The focus is on individual investors, and the reported empirical studies include quantitative surveys and an experiment, con-ducted among Finnish individual investors. The studies show that positive product design evaluations tend to (a) generate optimism about the financial returns of a company's stock – and (b) even elicit "extra willingness" to invest in the company, over and beyond its expected financial returns. Specifically, both optimism about a company's financial returns and "extra willingness" to invest in it (beyond financial returns) are positively influenced by two product design -related factors. The first factor is (1) the personal relevance that an investor attaches to "domains of life" that the company's products represent or support. Such domains can be vari-ous activities or areas of interest (e.g., road traveling, gardening, sport, electronics, aeronautics) – or more abstract themes or ideals (e.g., mobil-ity, healthcare, environment-protection). The second influ-ential factor is (2) the investor's overall affect or liking for a company's product design. This factor reflects the degree to which the investor perceives the company's products to be pleasant, attractive, good, and likeable overall. The results imply that companies can utilize product design's potential to attract investments – from investors who are appealed by the company's products and their design. Also "hybrid" business models can be created, which are based already at the outset, on certain investors' fondness of the company's current or future product design.
The application of system dynamics modelling in strategic decision-making and the analysis of market scenarios has been widely recognized. However, little attention has been placed on the application of system dynamics models to support operational decision-making. This paper presents a simple system dynamics model developed for BMW's production planning department to support decision making on production schedule, -mix and inventory management on a day-to-day basis. As we will show in the paper, production planning in car manufacturing is characterized by high complexity and uncertainty due to various parameters influencing the inventory levels and production progress. In this situation a static monitoring of inventory levels is not sufficient for production planning, since the inventory levels are critical for the car production process to work properly. Therefore a dynamic monitoring tool is needed. Based on a relatively simple structure, an easy-to-use interface, and online data-exchange, the developed system dynamics model described in this paper offers a tool to assess the risk associated with different inventory policies and improves the management of inventories and production schedules. The paper concludes with the experience made during the last 1Ω years, in which the model has been used by the production planners at BMW's production plant in Regensburg.
Many studies have investigated stock market reactions to announcements of dyadic strategic alliances creating generalizable findings on particularly three accounts: (1) dyadic alliances create value for the firms involved; (2) technology alliances create more value than marketing alliances; and (3) the small partners appropriate more value than the large partners. Yet, stock market reactions to multifirm alliances remain unexplored, despite the fact that such alliances are increasingly common and differ in important aspects from their dyadic counterparts. This paper uses event study methodology to address stock market reactions to multifirm alliance announcements. From a sample of 344 multifirm alliances in the period 1988-2004, we find that multifirm alliances create value for the firms involved and that the small partners appropriate most value. However, our results show a negative relation between value creation and the number of multifirm alliance partners. Moreover, in contrast to most research on dyadic alliances, we find that multifirm marketing alliances create more value than multifirm technology alliances. Theoretical and empirical implications are discussed.
Product development performance has become a critical-to-success aspect in this age of globalization and international competition. Platform based strategy could be used to enhance and support the efficiency and effectiveness of product development performance, as this paper suggests. This paper explores the impact of platform-based strategy on product development flexibility, product development leanness and product development performance. Five key hypotheses are presented based on the notion that use of the platform based strategy could enhance product development performance. Although this paper is presented as a conceptual paper at this point in time, it is hoped that data collection and analysis based on the suggested model will find all the stated hypotheses and relationships to hold true.
The integration of specialists’ search efforts is one of the principal purposes of organization. Integration mechanisms enable joint search by allowing interdependent others to form shared mental models of the joint task. However, apart from the formation of shared mental models, organization also impacts the locus of search and specialization in innovative conditions. This interplay between the emergence of self (specialized) knowledge and shared knowledge is likely to significantly impact joint search outcomes. In this paper we propose a computational model that examines the trade-off in the development of specialized vs. shared knowledge and how it impacts joint search for different innovation landscapes and different levels of agent ability. Our results point to the importance of not generalizing from single searcher problems for joint searcher problems.
In this study of the U.S. automobile industry, we highlight the way the division of innovative labor across firms in the supply chain can be influenced by a particular form of digital innovation known as “digital control systems.” Digital control systems are becoming ubiquitous in complex products, and these digital innovations integrate other components across a product structure and introduce a level of indeterminacy and unpredictability in the organization of the interfirm division of innovative labor. Much of organizational scholarship holds that, accompanying a shift toward increasingly modular product structures, component suppliers are engaging in relatively more design and invention around the components that they supply. We find that the evolution of digital controls may reverse this pattern, since in the wake of a major shift in the digital controls technology, suppliers actually engage in relatively less component innovation in comparison with their large manufacturing customers. To explain this shift, we characterize complex product structures in terms of two distinct product hierarchies: the inclusionary and the digital control hierarchy. In using this distinction to analyze the evolution of automotive emission control systems from 1970 to 1998, we reconcile two competing views about the interfirm division of innovative labor.
Results of a study of 95 new product projects in 75 Australian manufacturing firms reveal two important sets of links. Firstly, links between the elements of firms' organizational environments and proficiency of new product process activities. Secondly, links between activity proficiency and new product project outcomes. The two findings enable links to be posited between the organizational characteristics of firms and the outcomes of new project projects. The findings have implications for managers wishing to increase the likelihood of successful new product development.
Central to current thinking on what makes companies competitive is the notion that “it's not what you do, it's the way that you do it”. The way a task is carried out in a company is itself very much related to the attitudes and opinions of the company's managers. This article focuses on top managers’ attitudes to product design and shows which ones are related to superior competitive performance. An examination of the attitudes shows that there are seven basic managerial orientations to design. The most successful orientation is called the “balanced orientation” and consists of attitudes that underpin a commitment to leading the field technically and making developments market‐relevant.
Competition among product manufacturers is intensifying in many industries. The nature of this competition forces firms to manage the product supply process for speed to avoid product obsolescence and decreased competitiveness. Rene Cordero describes a number of time-saving techniques and develops a framework for managing the product supply process for speed: making speed a central objective of the firm, selecting faster product strategies, managing for the speedy implementation of these product strategies, and managing human resources for speed. Although speeding the product supply process requires significant changes in the traditional management of product development, managing for speed can bring benefits such as faster response to market needs, reduced product cost, and increased product quality.
This article examines the R&D/marketing interface conditions found within an extensive data base of new product development innovation projects. The incidence of different types of problems between these two important functions are analyzed and the effects of these observations on project outcomes are discussed. The article contains a number of recommendations for increasing the success rates of innovation projects by using a model that improves conditions at the R&D/marketing interface.
Marketing and R&D personnel are key actors in the development of new product innovations. Interdependence between the marketing and the R&D functions necessitates integration. Rudy Moenaert and William Souder feel that task specification, structural design and climate orientation are the major integration mechanisms advocated in the literature. Supported by an extensive literature review, they propose a nomological network which interrelates integration mechanisms, interfunctional information transfer, uncertainty reduction and new product innovation success. They develop a causal framework to describe the determinants of successful information transfer between marketing and R&D in the development of technologically new products.
Produktontwikkeling, een te plannen proces?
- Schoormans
The role of design and marketing management in the culture of innovation’ European Marketing Academy Conference
- Lowe
- R Hunter