Article ID: | iaor20073490 |
Country: | United States |
Volume: | 50 |
Issue: | 12 |
Start Page Number: | 1690 |
End Page Number: | 1703 |
Publication Date: | Dec 2004 |
Journal: | Management Science |
Authors: | Gerwin Donald, Thomson Vince, Bhuiyan Nadia |
Keywords: | performance |
This paper explores the linkages between key features of the new product development (NPD) process and NPD performance and suggests ways of designing the process to improve performance. Using a stochastic computer model, we examine, under varying uncertainty conditions, how the key features of overlapping and functional interaction affect the performance measures of development time and effort (total person-days for a project). Findings indicate that, first and foremost, whether or not overlapping occurs, increasing functional interaction eventually leads to a trade-off between development time and effort. Second, an ‘early-start-in-the-dark’ approach of increasing overlapping with no functional interaction is inferior even to an ‘over-the-wall’ approach. Third, increasing overlapping when some functional interaction exists is beneficial in low uncertainty and harmful in high uncertainty. Fourth, concurrent engineering is appropriate under low uncertainty, while a type of sequential engineering, different than the ‘over-the-wall’ approach, should be used under high uncertainty, and last, dedicated teams are suitable under high, and not low, uncertainty. We developed the model with the aid of a company and validated it against a published account of five case studies.