Optimal Planning Quantities for Product Transition

The replacement of an existing product with a new one presents many challenges. In particular, uncertainties in a new product introduction often lead to extreme cases of demand and supply mismatches. This paper addresses inventory planning decisions for product upgrades when there is no replenishment opportunity during the transition period. We allow product substitution: when a company runs out of the old product, a customer may be offered the new product as a substitute. We show that the optimal substitution decision is a time‐varying threshold policy and establish the optimal planning policy. Further, we determine the optimal delay in a new product introduction, given the initial inventory of the old product.     

In‐House Globalization: The Role of Globally Distributed Design and Product Architecture on Product Development Performance

Changes in the global economy and technological advances are stimulating increased geographic distribution of new product design and development efforts. For large organizations that design and develop complex products, this geographic distribution has added a new layer of complexity to product development operations. In this empirical study of a large auto manufacturer, we examine the operational performance implications of splitting the design of vehicle subsystems across multiple geographic locations. Our results indicate that global distribution diminishes the chance of completing tasks on time and degrades subsystem design quality. Finally, by examining the interplay between subsystem centrality and global distribution, we found that higher centrality in the product architecture amplifies the impact of global distribution on subsystem error rates.     

Distributed Development and Product Line Decisions

Distributed product development is becoming increasingly prevalent in a number of industries. We study how the global distribution of product development impacts the profit‐maximizing product line that a firm offers. Specifically, we formulate a model to understand the linkage between cost arbitrage as a driver of distributed development and consequent market implications such as customer perceived quality loss to remotely developed products. Analysis of the model reveals that a firm should expand the product line for a development‐intensive good only at intermediate values of cost advantage and quality loss. We modify the base model to include development capacity constraints as a driver of distributed development and find that the results are robust to this change. Our analysis affirms the need for product managers to incorporate the implications of distributed development in making their product line design decision.     

Structuring Work Distribution for Global Product Development Organizations

This study describes (through an application) a novel approach toward organizing work distribution across globally distributed design and development centers of a product development (PD) organization. While there exist several studies (and modeling applications) for work distribution and allocation for manufacturing and supply chain networks, those related to product development organizations are limited to qualitative suggestions such as offshoring of modular tasks. However, most PD efforts are characterized by significant complexity in information sharing and information dependency among PD tasks (represented by coupling in the system architecture of the firm), thus preventing the identification of modular tasks. Also, redesigning the architecture to introduce modularity has associated risks of costs and product integrity. We demonstrate a methodology to organize work distribution globally in an industrial setting, utilizing the design structure matrix to quantify the system architecture of the firm. Our optimization results show significant cost savings through a restructured PD organization. On analysis of the results, we make two significant observations: (a) while offshoring based on modularity is generally appropriate, it is not the whole answer, as there exists a trade‐off between the efficiency of performing specific PD tasks at the offshore location and the modularity of the task; and (b) firms should successively increase work allocation to the offshore location, benefiting from capability improvements through learning effects.     

顾客依赖及其对顾客参与新产品开发的影响

为了降低新产品开发的风险,企业越来越强调让顾客参与到新产品开发的过程中.以B2B市场为背景,基于企业的视角,以制度经济学中的依赖理论为基础,探讨组织市场中顾客参与新产品开发的动因,通过问卷调查法初步研究顾客依赖的影响因素及其对顾客参与新产品开发的影响.研究结果表明,在B2B市场中,环境的不确定性和交易专项投资对顾客依赖产生正向的影响,顾客依赖对顾客参与新产品开发具有正向影响,信任对顾客依赖与顾客参与新产品开发的关系有正向调节作用.最后,提出相关的营销建议.     

An Integrated Framework for Measuring Product Development Performance in High Technology Industries

We present an integrated framework for measuring product development performance. The framework consists of a three stage model for exploring the relationships between metrics used by design, manufacturing, marketing functions, and overall commercial success. Using a cross‐sectional survey of 383 product development professionals working on 38 product development projects in the high‐tech electronic assembled goods manufacturing sector, we provide empirical evidence of the proposed framework. The findings indicate that in the high‐tech manufacturing sector (1) commercial success of new product development projects is primarily determined by market share, (2) gain in market share is primarily driven by lower unit cost and not by technical performance, and (3) reduction in unit cost is primarily driven by the increased speed of new product development and not by the R&D budget. The study failed to identify any significant association between R&D budget and technical performance, and development speed and technical performance.     

研发阶段新产品信息发布:时间与频率策略研究

新产品开发过程中,何时、以什么频率向外发布所开发的新产品的信息,是企业经营者需要决策的重要问题.现有的文献对新产品信息发布频率尚无直接研究,对首次发布信息时间的研究也还非常有限.本文基于信号理论和有效市场理论,以2000-2010年间我国上市公司发布的602个新产品项目为样本,采用事件研究法和回归分析,研究了研发阶段企业新产品信息发布的时间与频率策略及其市场效果.结果表明,新产品首次发布信息的时间、发布信息的频率对新产品的市场价值都存在倒U形的影响;开发过程中企业与外部商业伙伴的合作对上述两种影响产生负向的调节作用;新产品的创新性正向调节首次发布信息的时间对新产品市场价值的影响.本文的研究结果对于企业新产品开发阶段信息传播策略具有现实的指导意义.     

To Preannounce or Not: New Product Development in a Competitive Duopoly Market

In this study, we consider the issue of preannouncing or not preannouncing the development of a new product. Our research is motivated by contrasting views in the literature and varying actions observed in practice. We develop and analyze a game theoretic model that examines the effect of a firm's preannouncement of its product development. Our model is based on a durable goods duopoly market with profit‐maximizing firms. The first firm is an innovator who initially begins developing the product; the second firm is an imitator that begins developing a competing product as soon as it becomes aware of the innovator's product. We assume that consumers are rationally expectant and purchase at most one unit of the product when they have maximum positive utility surplus that is determined by the characteristics of the product, the consumer's marginal utility, and the consumer's discounted utility for future expected products. The innovator firm can release information about its product when it begins developing the product or can guard information about its product until it introduces the product into the market. Our analysis and numerical tests show that, under some conditions, the innovator firm can benefit by preannouncing its product and giving the imitator firm additional time to differentiate its product. We discuss these conditions and their implications for new product development efforts.     

Industry Clockspeed and the Pace of New Product Development

Recent empirical literature describes an industry's clockspeed as a measure of the evolutionary life cycle, which captures the dynamic nature of the industry. Among other factors, the rate of new product development is found to be associated with an industry's clockspeed. Yet the notion of an industry clockspeed and the essential factors driving suitable decision making in this area have remained relatively unexplored. We develop a simple definition and a corresponding analytic model which explains the interdependent relationship between a firm's own new product development activities and an industry clockspeed. Results from the single firm model show the conditions under which particular firms have an incentive to accelerate their new product development activities. Moreover, we link the single firm's NPD clockspeed decisions to the industry level by creating appropriate metrics which characterize different types of industries. Examples from high‐tech industries such as the personal computer and aerospace industries are included to illustrate our findings. Our intention is not only to offer analytical insights into factors driving the clockspeed for these industries, but also to establish a fundamental structured decision making approach, thereby stimulating future research on this important topic.     

A Retrospective Look at Production and Operations Management Articles on New Product Development

We present a retrospective look at the articles on New Product Development that appeared in the first 50 issues of Production and Operations Management (POM). We discuss some of the strengths and weaknesses of this POM literature stream. This article is not intended to be a literature review or an exhaustive review of the articles. Rather, we seek to identify new opportunities for rigorous and relevant research, research that has the potential of differentiating and enhancing POM within the Operations Management literature.     

基于前景理论的新产品开发方案选择方法

为了解决新产品开发中考虑竞争产品方案评价信息的方案选择问题,提出了一种基于前景理论的决策分析方法。在该方法中,依据新产品开发方案与竞争产品方案相比的绩效确定前景参考点,并给出了前景价值函数和权重函数;通过计算和比较新产品开发方案的前景值和竞争产品方案的前景值,得到新产品开发方案的优选结果;最后给出一个算例,说明该方法的可行性和有效性。     

Hierarchical model to design manufacturing systems applied to a metal-mechanic company

This paper describes the application of a model to design and manage the manufacturing process through an integrated system, using a Hierarchical methodology-by means of different aggregation and disaggregation stages with an appropriate time horizon. The hierarchical model obtained allows interfacing between the master schedule and the schedule of the orders. At each level of the hierarchical model some decisions have to be made in order to design the manufacturing system, but having a model that also takes into consideration the management of the system. To do this it is necessary to use aggregated information concerned with the level at which decisions are made. It is obtained from the database, which contains the information at the highest level of aggregation. This model has been applied to a metal mechanic company, that makes final products such as car washers, etc. The benefits of this approach for the company are addressed in this paper.     

国际资源效率研究进展与演化趋势述评

资源效率的提升不仅是增加竞争优势、抢占未来可持续发展制高点的关键环节,更是保证区域资源与生态安全、实现可持续发展的重要基础.基于Web of Science数据库,采用多元、分时、动态的第二代信息可视化软件,从管理情境出发,对国际资源效率提升的相关研究进行信息挖掘、可视化处理和深度解析,理清资源效率领域的发展脉络、热点分布、演化路径和未来趋势,明确我国相关研究的缺陷与不足,为我国资源效率管理体系的构建和效率提升能力建设的发展方向提供理论支撑和情报支持.     

The Effect of Product Development Restructuring on Shareholder Value

This article examines the effect of product development restructuring (PDR) on shareholder value. The results are based on a sample of 165 announcements made during 2002–2011. PDR announcements are associated with an economically and statistically significant positive stock market reaction. Over a two‐day period (the day of the announcement and the day preceding the announcement), the mean (median) market reaction is 1.63% (0.87%). The market reaction is generally positive regardless of the PDR purpose or action. Although the market reaction is more positive for higher R&D intensity firms, it is not directly affected by the firm's prior financial performance or whether the firm's primary PDR objective is to increase revenues or cut costs. However, the interaction between the firm's prior financial performance and its primary PDR objective is significant. For firms that are financial outperformers, the market reaction is more positive if the firm's primary PDR objective is to increase revenues. For financial underperformers, the market reaction is more positive if the firm's primary PDR objective is to cut costs.     

企业产品开发的评价模型及方法研究

首先,本文根据企业产品开发活动的特点,在遵循相关原则的基础上,建立了以投入、管理、产出为二级指标的三段式产品开发评价指标体系;其次,本文通过格栅获取法和模糊borda数分析法,确定指标体系各因素的权重;最后,本文采用德尔菲法与模糊评价相结合的方法来进行综合评价。实践结果表明:该模型具有科学性与可行性。     

多层次激励系统可靠性的敏感分析

多层次激励系统的可靠性由各子系统的可靠性及它们之间的相互关系决定。激励系统可靠性灵敏度是测量激励系统可靠性对激励层次有效概率变化的反应程度。数学模型显示,激励的层次和路径依赖度是影响激励系统可靠性的关键因素。企业可以通过将激励资源优化配置给能带来最大增量效应的对象和改善上下级依赖关系2种方法来提高激励系统可靠性。     

A Risk Analysis Model in Concurrent Engineering Product Development

Concurrent engineering has been widely accepted as a viable strategy for companies to reduce time to market and achieve overall cost savings. This article analyzes various risks and challenges in product development under the concurrent engineering environment. A three‐dimensional early warning approach for product development risk management is proposed by integrating graphical evaluation and review technique (GERT) and failure modes and effects analysis (FMEA). Simulation models are created to solve our proposed concurrent engineering product development risk management model. Solutions lead to identification of key risk controlling points. This article demonstrates the value of our approach to risk analysis as a means to monitor various risks typical in the manufacturing sector. This article has three main contributions. First, we establish a conceptual framework to classify various risks in concurrent engineering (CE) product development (PD). Second, we propose use of existing quantitative approaches for PD risk analysis purposes: GERT, FMEA, and product database management (PDM). Based on quantitative tools, we create our approach for risk management of CE PD and discuss solutions of the models. Third, we demonstrate the value of applying our approach using data from a typical Chinese motor company.     

Collaborative Product Development: The Effect of Project Complexity on the Use of Information Technology Tools and New Product Development Practices

Collaboration is an essential element of new product development (NPD). This research examines the associations between four types of information technology (IT) tools and NPD collaboration. The relationships between NPD practices and NPD collaboration are also examined. Drawing on organizational information processing theory, we propose that the relationships between IT tools and NPD collaboration will be moderated differently by three project complexity dimensions, namely, product size, project novelty, and task interdependence, due to the differing nature of information processing necessitated by each project complexity dimension. Likewise, the moderation effects of the project complexity dimensions on the relationship between NPD practices and NPD collaboration will also be different. We test our hypotheses using data from a sample of NPD projects in three manufacturing industries. We find that IT tools are associated with collaboration to a greater extent when product size is relatively large. In contrast, IT tools exhibit a smaller association with collaboration when project novelty or task interdependence is relatively high. NPD practices are found to be more significantly associated with NPD collaboration under the contingency of high project novelty or high task interdependence. The findings provide insights about circumstances where several popular IT tools are more likely to facilitate collaboration, thus informing an NPD team's IT adoption and use decisions.     

Inventory Planning for a Modular Product Family

This paper is motivated by observing that an increasing number of firms are offering modular products assembled with multiple option choices for the consumer. Starting with the PC offerings by Dell which allowed (and still allows) users to configure their product by choosing among multiple choices for each option, the current market place seems to have evolved to a make‐to‐stock scenario where Apple offers its IPAD series with multiple models each with a unique storage size, color, and wireless chip technology. The focus of our work is on determining the optimal stocking level of modular end‐products. Our analysis is based on a benchmark model with the aim of maximizing expected profit subject to an aggregate fill rate constraint as well as variant‐specific individual fill rates under a make‐to‐stock setting. To further assess the robustness of our finding, we consider the extensions of correlated market preferences over options, price‐dependent demand, and alternative probability distributions for characterizing uncertainty in market preferences or aggregate demand. Finally we also show how to extend the single period model into a multiple‐period setting. Through extensive computational analysis, we find that more precise estimates of market preferences for various modular options constitute extremely valuable information that goes beyond the usefulness of forecasts of aggregate market demand. From a practical perspective, this might be indicative of another classic marketing‐operations trade‐off. Offering more options for consumers would be preferred by marketing managers since this would reach more consumers and hence, enhance product sales. On the other hand, the ability to obtaining greater forecast accuracy would decline when the number of options increase. Hence, from an operational perspective, it would be preferred to limit option choices (so that better forecasts can be obtained) since this would lead to lower stocking costs and hence, higher profits.