Collaborative New Product Development in Literature Review
Excerpt from Literature Review :
In the most successful SMB implementations of collaborative new product development tools including PLM and PDM, priority is put first on process definition and process improvement. Once processes have been defined, continually managed to greater efficiency and as optimized as possible, then the use of information systems technologies and platforms to automate them are added (Christensen, Magnusson, Zetherstrom, 2006, 583-585). PLM as a technique or strategy is not automated until the core processes that comprise a given SMBs use of it are made as efficient as possible and optimized through business process re-engineering over time. It is critical then for SMBs looking to build a collaborative new product development strategy to first look to streamline the most critical core processes their collaborative new product development strategies will address.
Collaborative New Product Development Process Focus
Empirical studies indicate collaborative new product development strategies have a significantly higher level of success when they are first defined from a process standpoint first. With a process orientation, SMBs are finding it much easier to correlate investments in collaborative new product development techniques and tools to the longer-term results necessary to attain their strategic plans. Studies indicate that the ability of an SMB to define its entire collaborative new product development plans in the context of processes first makes a big difference in how long the company continues to rely on them (Peterson, 2006, 38-40). In other words, the more an SMB concentrates on the most critical product development processes it has, the more likely their collaborative product development initiatives, programs and strategies will become a core part of their organizations. Without this process-based focus, studies indicate SMBs fail to adopt collaborative new product development systems and strategies into their company's mainstream operations. Making collaborative new product development strategies directly tied to their company's most critical product development processes, SMBs are also finding that resistance to change also is decreased. Those employees most impacted by the new PLM, PDM and collaborative new product development systems and techniques are more likely to adopt and use them when they are aligned to key processes and strategies.
The eight most common strategic process areas SMBs concentrate on to ensure a higher adoption and success rate of collaborative new product development tools and techniques include the following. The New Product Introduction (NPI) success rate, time-to-market performance relative to industry standards and timelines, engineering productivity, design reuse and cost reduction, and engineering cycle time reductions are the primary process areas that SMBs who are successful over the long-term with their new product development strategies concentrate on. Each of these process areas directly impacts the ability of an SMB to generate greater revenues through new product development while also ensuring existing product upgrades and engineering stay on schedule. Each of these process areas also has a very high degree of inherent collaboration within each of them. For many SMBs who are experiencing exceptionally fast growth, these process areas force them to create scalable, secure and globally-based collaborative new product development platforms delivered over the Internet. (Prandelli, Verona, Raccagni, 2006, 134, 135). Basing collaborative new product development strategies on the NPI success rate forces a higher level of collaboration across suppliers, distributors and other critical partners outside of an SMB. The NPI success rate also galvanizes the focus in an SMB towards the attainment of a single, shared goal. This has been found to significantly reduce resistance to change and a lack of commitment to collaborative new product development techniques and strategies. The NPI success rate also has been shown to force a tighter integration of PLM and PDM systems both at a technology and process level as well. Finally the NPI success rate metrics, often measured in terms of sales, profits and overall performance, are much more relevant across the entire ecosystem of an SMB than any internally derived metric. Those SMBs who are the most successful with the development and use of their collaborative new product development techniques, tools and strategies focus on the NPI success rate and become very focused on the New Product Development and Introduction (NPDI) process as well (Ming, Yan, Wang, Li, Lu, Peng, Ma, 2008, 154). As the NPI success rate and NPDI process are the two most critical process areas to the long-term financial strength and viability of any company, these two areas get the majority of attention in SMBs as well (Ledwith, Richardson, Sheahan, 2006, 439, 440).
The processes that support time-to-market performance of an SMB relative to its competitors and the industry also act to provide greater
direction and focus to collaborative new product development strategies as well. SMBs that compete in areas of high technology that are characterized by very rapid product lifecycles are passionate about this metric (Winnick, 2006, 93). The credibility of an SMB is directly tied to their ability to get their latest product generations out the door within the market windows their industry measures themselves on. An example would be an SMB that concentrates on value-added products for the Apple iPad for example. There are literally now over 100 companies who launched in some cases their companies and products on the same day Apple announced their latest generation tablet. Companies whose products were launched and available on the Apple launch day have much greater credibility and the potential to gain much greater market share as a result. The time-to-market performance metric and its associated processes also anchors collaborative new product development techniques, tools and the strategies they support to a very high level of accountability within SMBs as well.
The remaining process areas of engineering project development, product design and development, design reuse and cost reduction, and engineering cycle time reductions together solidify collaborative new product development systems in SMBs. In SMBs that are attaining the highest levels of performance they also form the center of their PLM platforms and strategies and also act as a coordination point for their direct materials sourcing and coordination of customer needs management. Figure 1, Product Lifecycle Management Overview defines how the five functional areas of companies are integrated together to support collaborative new product development strategies (Robin, Girard, 2010, 318)
. Each of the techniques and tools shown in Figure 1 exist in varying levels of maturity in SMBs with the Product Data Management (PDM), Customer Needs Management, Supply Chain Management and Sourcing, and Project Management being the overarching coordination approach many SMBs take.
Figure 1: Product Lifecycle Management Overview
Source: based on analysis of (Robin, Girard, 2010, 318)
(Merono-Cerdan, Soto-Acosta, Lopez-Nicolas, 2008)
Figure 1 is what many SMBs who have successfully integrated process workflows into their collaborative new product development strategies aspire to attain. In reality many SMBs are on a journey to the level of maturity shown in Figure 1 with specific industries being ahead of others. In those industries that are predominantly knowledge-based and therefore scalable across broad geographic regions, the attainment of process expertise and integration is attainable at a faster rate. For the majority of SMBs however the collaborative new product development process is one that relies primarily on templates to ensure consistency of workflows, use of prepackaged and often industry-specific software. For product data management the majority of SMBs are using templates and taxonomies predefined for their industries as this saves significant time and costs. The use of templates for ensuing consistency and accuracy of communication in highly collaborative new product development scenarios is often supported by Intranet-based portals and applications as well. The use of team-based software that is industry specific, delivered on a hosted or SaaS platform also is being adopted in SMBs due to the price points of these solutions and the ability to customize them internally for collaboration needs. Web 2.0 design objectives are also having an impact on the development and use of collaborative new product development software, systems, techniques and tools. The Web 2.0 Meme Map as defined by O'Reilly (2006) is shown in Appendix A. Many of the social networking applications designed since Web 2.0 design objectives were initially defined are being used within SMBs to further support and streamline collaborative new product development. To the extent SMBs use these collaborative applications to increase the quality and consistency of communication is the extent to which they are able to more fully attain their new product development objectives. Collaborative new product development strategies in start-ups are more heavily reliant on social networking-based applications as in many cases they have low to no cost and are often configurable to a limited set of customizable functions.
The SMBs who are being the most successful with their collaborative new product development strategies anchor them in process-based definitions first, and then align them to strategic goals and objectives second. This approach to aligning new product development to key process areas leads to collaborative new product development efforts being more focused and attaining results. SMBs who fail at collaborative new product development often have a limited if any type of financial metric of performance associated with its…
Sources Used in Documents:
Michael A. Allocca, and Eric H. Kessler. 2006. Innovation Speed in Small and Medium-Sized Enterprises. Creativity and Innovation Management 15, no. 3,
(September 1): 279.
Rajiv D. Banker, Indranil Bardhan, and Ozer Asdemir. 2006. Understanding the Impact of Collaboration Software on Product Design and Development.
Information Systems Research 17, no. 4, (December 1): 352-373,440.
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