Article ID: | iaor20135302 |
Volume: | 59 |
Issue: | 10 |
Start Page Number: | 2217 |
End Page Number: | 2236 |
Publication Date: | Oct 2013 |
Journal: | Management Science |
Authors: | Netessine Serguei, Gopal Anandasivam, Goyal Manu, Reindorp Matthew |
Keywords: | entrepreneurs, survey data, new product development |
Product launch–an event when a new product debuts for production in a plant–is an important phase in product development. But launches disrupt manufacturing operations, resulting in productivity losses. Using data from North American automotive plants from years 1999–2007, we estimate that a product launch entails an average productivity loss of 12%–15% at the plant level. This translates to a monetary loss of $42–$53 million per launch in lost productivity. We identify several ways to mitigate the decrease in productivity.