Design Reuse in Manufacturing and Services*

Most professionals, actively engaged in design, live in a world of trade‐offs. The most typical compromise is that reducing the cost of design causes quality to suffer, but there are many others as well. This paper summarizes current use of one of the most popular approaches to improving the new offering development process: design reuse. In the present study 42 companies were surveyed, of which 23 were in manufacturing and 19 were in services—but all were actively engaged in technology and design reuse in new offerings. It was hypothesized that policies for design reuse and internal sourcing would promote the complexity and breadth of reuse (here the combination of modular and architectural substitution), which, in turn would dampen the percentage of substitution and reduce the negative impact on innovativeness of new offerings. These predictions were generally supported. Adoption of policies for encouragement or to mandate design reuse were significantly correlated with the extent of reuse (application of both architectural and modular design vs. just one or the other) among manufacturers but not services firms in the sample. Internal sourcing of ideas for design reuse was significantly correlated with extent of reuse for the total sample, and especially for services. Design reuse percentage and extent of design reuse were significantly and inversely associated for manufacturing, as predicted, but not for services. Novelty of new offerings was significantly and inversely related to percentage of reuse, as predicted, for manufacturing, but not for services. It was found that sector also makes a difference in likelihood of adopting higher levels of reuse with service company respondents reporting significantly higher levels (average of 42% reuse for services and 28% for manufacturing applications). Perhaps one of the most interesting preliminary findings to emerge was that the tipping point of negative impact from design reuse percentage on innovativeness for all firms in the sample of new offerings was 43%, beyond which novelty suffers. For manufacturing, the tipping point was lower: Novelty begins to suffer after 33% design reuse, which has important management implications. The conclusion was drawn, based on these preliminary results, that much can be done to relieve some of the negative consequences of the typical trade‐offs commonly encountered in development programs for new offerings, especially when cost, timing, and innovation are the target goals. However, services and manufacturing are quite different in their approach to design reuse and substitution. Further development of the concept of design reuse strategy appears to be warranted based on these preliminary findings. The findings raise the distinct possibility that mesolevel strategic aggregation issues might lead research into areas that help explain how complex systems realize their full self‐organizing potential and why corporate strategy considerations, alone, have failed to explain the success and failure of organizations coping in rugged landscapes.     

Exploring New Product Development Project Review Practices*

Most organizations use new product development (NPD) processes that consist of activities and review points. Activities basically solve problems and gather and produce information about the viability of successfully completing the project. Interspersed between the development activities are review points where project information is reviewed and a decision is made to either go on to the next stage of the process, stop it prior to completion, or hold it until more information is gathered and a better decision can be made. The review points are for controlling risk, prioritizing projects, and allocating resources, and the review team typically is cross‐disciplinary, comprising senior managers from marketing, finance, research and development (R&D), or manufacturing. Over the past four decades, research has greatly advanced knowledge with respect to NPD activities; however, much less is known about review practices. For this reason, the present paper reports findings of a study on NPD project review practices from 425 Product Development & Management Association (PDMA) members. The focus is on three decision points in the NPD process common across organizations (i.e., initial screen, prior to development and testing, and prior to commercialization). In this paper, the number of (1) review points used, (2) review criteria, (3) decision makers on review committees and the proficiency with which various evaluation criteria are used are compared across incremental and radical projects and across functional areas (i.e., marketing, technical, financial). Furthermore, the associations between these NPD review practices and new product performance are examined. Selected results show that more review points are used for radical NPD projects than incremental ones, and this is related to a relatively lower rate of survival for radical projects. The findings also show that the number of criteria used to evaluate NPD projects increases as NPD projects progress and that the number of review team members grows over the stages, too. Surprisingly, the results reveal that more criteria are used to evaluate incremental NPD projects than radical ones. As expected, managers appear to more proficiently use evaluation criteria when making project continuation/termination decisions for incremental projects; they use these criteria less proficiently during the development of radical projects, precisely when proficiency is most critical. At each review point, technical criteria were found to be the most frequently used type for incremental projects, and financial criteria were the most commonly used type for radical ones. Importantly, only review proficiency is significantly associated with performance; the number of review points, review team size, and number of review criteria are not associated with new product performance. Furthermore, only the coefficient for proficiently using marketing criteria was significantly related to new product program performance; the proficiency of using financial and technical information has no association with performance. Finally, across the three focal review points of the NPD process in this study, only the coefficient for proficiency at the first review point, (i.e., the initial screen) is significantly greater than zero. The results are discussed with respect to research and managerial practice, and future research directions are offered.     

New Product Development Practices of Industrial Marketers*

William L. Moore personally interviewed a number of senior managers employed in 25 large industrial marketing companies about new product development practices. These managers are familiar with all phases of the development of typical new products, from the time ideas are generated until market introduction. Most respondents were either division heads or those directly responsible for a division's new product development program. In agreement with a previous study, the use of formal new product strategies and sophisticated quantitative marketing research techniques was found to be lacking in most companies. However, many other elements of the new product development process were carried out more completely than previously reported. For example, respondents reflected sensitivity to informal understanding of new product strategies. A number of the less sophisticated, small scale qualitative research methods actually used may be more appropriate than more sophisticated methods. While several research areas are suggested, the general assessment of the new product practices of these firms is more positive than that of Feldman and Page.     

An Exploratory Investigation of NPD Practices in Nonprofit Organizations*

Studies of practices in new product and service development have focused predominantly on for‐profit organizations, whereas attention to the nonprofit sector has been minimal. Such attention is needed given that nonprofit organizations are unique in their structures and are growing with regards to impact on the world economy and society in general. Moreover, such disparate attention suggests a void in this discipline's understanding of new product development (NPD) practices of nonprofit organizations. Two particular research questions are posed: (1) To what extent are the practices of for‐profit organizations employed in nonprofit organizations? (2) How do the practices of nonprofits compare to those of for‐profit organizations? In the course of answering these questions, the present study reviewed literature and the Product Development and Management Association (PDMA) certification work. The study subsequently identified six dimensions of successful NPD efforts: strategy, portfolio management, process, market research, people, and metrics and performance measurement. These dimensions were applied via an in‐depth case‐study methodology to six large, U.S. nonprofit organizations: American Association of Retired Persons (AARP), American Cancer Society, American Heart Association, American Red Cross, Boys and Girls Club of America, and Goodwill Industries. The dimensions assisted in categorizing and analyzing the responses of 40 respondents across the six organizations. Results show that some NPD practices of large nonprofit organizations are similar to for‐profit organizations, but other practices are more distinctive and related to the nature of nonprofit organizations. Large nonprofit organizations tend to be very good at articulating their mission, embedding it throughout, and using it to drive programs and activities. These organizations tend to view product development as a tactical endeavor versus a strategic one and do not engage in portfolio management practices for their new programs. Instead, broad criteria such as fit with mission, funding availability, and presence of a champion are used for evaluating programs. The NPD process tends to be informal with little structure, and individual departments and local chapters tend to undertake their own NPD initiatives and have their own process for doing so. Nonprofits place a heavy emphasis on ideation and less emphasis on other activities such as concept development and testing, project evaluation, and business analysis. Pilot testing is the most used type of market research. These results suggest that NPD processes within large nonprofit organizations share some of the same weaknesses as those of for‐profit organizations, with NPD metrics being a particularly weak area. The NPD practices of nonprofits also have some unique characteristics that include the following: a heavy emphasis on the mission, a desire for flexibility, strong influence of external sponsors, and difficulty in assessing long‐term program success. Management of nonprofit NPD and directions for future research are discussed.     

Exploring Portfolio Decision‐Making Processes*

Portfolio management is the set of activities that allows a firm to select, develop, and commercialize a pipeline of new products aligned with the firm's strategy that will enable it to continue to grow profitably over the long term. To appropriately manage the firm's new product portfolio, decisions must be made about which projects to fund, to what levels, at what point in time. Previous research has investigated portfolio management decisions as individually discrete decisions. Significant streams of research have investigated both project selection and project termination decisions. This research project shows, however, that portfolio decision making may be better understood if it is considered as an integrated system of processes that considers these decisions simultaneously, along with other decisions such as those to continue a project with reduced funding. Using in‐depth data from four diverse case studies, we use a grounded theory approach to develop a general model of how firms make new product portfolio decisions. According to the findings from these cases, effective portfolio decision‐making processes produce a portfolio mindset, focus effort on the right projects, and allow agile decision making across the portfolio's set of projects. Effective portfolio decision making is the result of the interaction between three types of decision‐making processes that managers use in making decisions: evidence‐, power‐, and opinion‐based. Being able to use each of these types of processes to make decisions depends upon having the data inputs that they require. Three domain‐based decision input‐generating processes (i.e., cross‐functional collaboration, practices of critical thinking, and practices of market immersion) are associated with making evidence‐based portfolio decisions. In addition, organizational politics produces the inputs that are associated with power‐based portfolio decision making, while managerial intuition is associated with opinion‐based portfolio decision making. Firm cultural factors, including trust, collective ambition, and leadership style, are associated with how these evidence‐, power‐ and opinion‐based processes are combined into an overall portfolio decision making process, and whether the firm's processes are more rational and objectively made, or more politically and intuitively made. The article presents propositions for how the decision‐making processes interact in their associations with decision‐making effectiveness.     

PERSPECTIVE: Trends and Drivers of Success in NPD Practices: Results of the 2003 PDMA Best Practices Study*

Since 1990, the Product Development & Management Association (PDMA) has sponsored best practice research projects to identify trends in new product development (NPD) management practices and to discern which practices are associated with higher degrees of success. The objective of this ongoing research is to assist managers in determining how to improve their own product development methods and practices. This paper presents results, recommendations, and implications for NPD practice stemming from PDMA's third best practices study, which was conducted in 2003. In the eight years since the previous best practices study was conducted, firms have become slightly more conservative in the portfolio of projects, with lower percentages of the total number of projects in the new‐to‐the‐world and new‐to‐the‐firm categories. Although success rates and development efficiencies have remained stable, this more conservative approach to NPD seems to have negatively impacted the sales and profits impact of the new products that have been commercialized. As formal processes for NPD are now the norm, attention is moving to managing the multiple projects across the portfolio in a more orchestrated manner. Finally, firms are implementing a wide variety of software support tools for various aspects of NPD. NPD areas still seriously in need of improved management include idea management, project leadership and training, cross‐functional training and team communication support, and innovation support and leadership by management. In terms of aspects of NPD management that differentiate the “best from the rest,” the findings indicate that the best firms emphasize and integrate their innovation strategy across all the levels of the firm, better support their people and team communications, conduct extensive experimentation, and use numerous kinds of new methods and techniques to support NPD. All companies appear to continue to struggle with the recording of ideas and making them readily available to others in the organization, even the best. What remains unclear is whether there is a preferable approach for organizing the NPD endeavor, as no one organizational approach distinguished top NPD performers.     

Lump-Sum Payments and Retail Services: A Relational Contracting Perspective*

How should manufacturers motivate their retailers to provide customer services? The vertical restraints literature tells us that retail competition distorts service incentives in the short run. We consider how repeated interaction mitigates this problem, and particularly how a manufacturer can provide service incentives with discretionary lump-sum payments. We find that these payments may allow the manufacturer to sustain optimal service levels even if retailers are very impatient. We also show that banning reverse lump-sum payments may deprive consumers of the chance to enjoy high-quality services, and thereby reduce their welfare.     

Innovation Management Practices Compared: The Example of Project‐Based Firms*

The importance of project‐based firms is increasing, as they fulfill the growing demands for complex integrated systems and knowledge‐intensive services. While project‐based firms are generally strong in innovating their clients' systems and processes, they seem to be less successful in innovating their own products or services. The reasons behind this are the focus of this paper. The characteristics of project‐based firms are investigated, how these affect management practices for innovation projects, and the influence of these practices on project performance. Using survey data of 203 Dutch firms in the construction, engineering, information technology, and related industries, differences in characteristics between project‐based and nonproject‐based firms are identified. Project‐based firms are distinguished from nonproject‐based firms on the basis of organizational configuration, the complexity of the operational process, and the project management capabilities of the firm. Project‐based firms also differ with regard to their level of collaboration and their innovation strategy, but not in the level of autonomy. A comparison of 135 innovation projects in 96 of the firms shows that project‐based firms do not manage their innovation projects different from other firms. However, the effects of specific management practices on project performance are different, particularly the effects of planning, multidisciplinary teams and heavyweight project leaders. Differences in firm characteristics provide an explanation for the findings. The implication for the innovation management literature is that “best” practices for innovation management are firm dependent.     

Exploring the Contributions of Involving Ordinary Users in Ideation of Technology‐Based Services*

Lead users have long been acknowledged as important contributors to the market success of innovative products and services. The ability of lead users to be such effective innovators has been ascribed to a combination of adequate technological expertise and superior knowledge of the user domain so‐called use experience. Drawing on the apparent success of lead users in innovation, many companies are now attempting to involve other types of users, namely, ordinary users, for ideation at the fuzzy front end (FFE) of new product and service development. However, ordinary users do not usually possess the technological knowledge of lead users, and the existing literature provides little guidance on how to manage such user involvement or its expected contributions. The purpose of the present study is, therefore, to contribute to scholarly knowledge regarding the benefits and management of user involvement during the ideation phase of innovation in technology‐based services. More specifically, the study investigates the contribution made in this respect by “ordinary” users, as opposed to professional developers. The research questions that are addressed are as follows: (1) What contributions do ordinary users make when involved in the FFE for ideation of new technology‐based services; and (2) how is the contribution of the users affected by their knowledge of the underlying technology? The study addresses these questions through a literature review and conceptual analysis of the involvement of users in innovation in mobile telephony, followed by an empirical study using a quasi‐experimental design in which the independent variable is the users' technological knowledge of the underlying mobile telephone system and the dependent variable is the quality of the created idea‐proposals from an innovation perspective. Various scenarios involving guided users, pioneering users, and professionals are investigated. The study finds that the users' knowledge of the underlying technology has an effect on their propensity to contribute with incremental or radical new ideas. The ideas from guided users tend to be more incremental whereas the pioneering users' ideas are more radical. Contrary to the users in the guided user scenarios, the users in the pioneering user scenarios have a propensity to produce ideas that challenge the prevailing dominant logic of the company; these ideas can be used to assist the company to think in new trajectories. The paper proposes that ordinary users should not be expected to contribute ideas that can be directly put into the new product development process; rather, ordinary user involvement should be regarded as a process whereby a company learns about users' needs and is inspired to innovate. The paper concludes that user involvement can actually be a stimulus for review of a company's business strategy.     

Exploring the Relationships Between Product Development and Environmental Turbulence: The Case of Mobile TLC Services*

Managing innovation in turbulent environments (e.g., in environments with extreme uncertainty and complexity in market needs and technological opportunities) is a major challenge. A recent stream of studies in the management literature has suggested that when facing turbulent environments, firms should deploy more flexible development processes. This paper approaches this issue by looking at the Italian mobile telecommunications (TLC) industry. Nine in‐depth case studies were conducted in five different companies. Data analysis showed some important results. First of all environmental turbulence should be considered to be project specific rather than company or industry specific. Moreover, it can come from both shift in the market needs and in the technology. Nevertheless, it seems clear that having rapid changes is not enough to have environmental turbulence. If rapid changes can be somehow foreseen, there is no turbulence at all. Hence, when approaching projects in potentially turbulent environments, managers should assess both rapidity and unpredictability of the environment. Finally, looking at the in‐depth cases, the paper points out what of the main practices to increase flexibility that are described in literature are actually adopted by companies. In case of turbulence (both in the market and/or in the technology) companies delay concept freezing point. Moreover, in the case of technological turbulence, they also leverage on rapid project iterations, whereas in case of market turbulence they more likely adopt early experiments involving customers, formal and cross‐functional project teams, and flat organizational structures.     

Design Inertia: Designing for Life‐Cycle Flexibility in Internet‐Based Services*

Managing innovation in rapidly moving environments, such as Internet‐based services, is a major challenge in theory and in practice. Most of the existing literature focuses on the development process as the main area in which innovation takes place. However, in environments where the pace of change of technology and market needs is extremely high, managing service innovations means not only being able to design a good service but also, more importantly, continuously redesigning and adapting the service in order to deal with frequent exogenous changes and opportunities. A high number of innovations therefore must be introduced throughout the entire life cycle of a service. This capability of introducing incremental and radical innovations during the service life cycle (i.e., to adapt a service to contextual changes and opportunities after it has been first released onto the market) at low costs and in the shortest possible time is what is defined here as service life‐cycle flexibility. This process of service adaptation and upgrading implies significant challenges that can be traced back to when a service is first conceived and designed. In fact, many decisions made during the first design process (i.e., the choice of a given database environment) involve a low reversibility rate and may reduce the possibility of taking advantage of future unpredictable opportunities, creating what is called inertia toward innovation. In other words, service life‐cycle flexibility largely depends on how a service has been first designed. This article analyzes two in‐depth case studies of Italian online newspapers and identifies five possible inertia factors that may influence service life‐cycle flexibility, namely (1) technological inertia; (2) internal organizational inertia; (3) external organizational inertia; (4) customer inertia toward changes in the service package; and (5) customer inertia toward changes in the service interaction design. These inertia factors are traced back to the service development process in order to suggest design practices that may increase the service life‐cycle flexibility.     

Family-Friendly Practices and Worker Representation in Germany

The determinants of three employer-provided family-friendly work practices are estimated for German establishments. The presence of a works council stands as a positive determinant of all three practices. When works councils exist in the presence of collective bargaining, their influence tends to reflect the demographics of the workplace. The role of the works council becomes larger when the share of women increases and the share of part-timers decreases. We suggest this is consistent with the voice role of works councils.     

体验式培训在煤炭企业安全培训中的应用

介绍了煤炭企业体验式安全培训的产生及其理论基础,阐述了典型事故案例分析、安全培训头脑风暴、安全培训场景模拟和安全培训拓展训练等具体方法,认为体验式培训是煤炭企业安全培训的有益补充。     

Managing Knowledge for Innovation: The Case of Business‐to‐Business Services*

The present study builds a typology of organizational knowledge in business services and empirically examines the effects of knowledge on innovation performance. It is suggested that firms differ with respect to their knowledge creation approaches and that these approaches have implications for firms' innovation activities. A conceptual framework of knowledge assets with degrees of tacitness and collectiveness as the principal axes is used to ground the empirical analysis. The organizational knowledge framework is empirically operationalized using survey data from 167 business service firms and supplementary case study evidence from 16 other firms. It is found that business service improvements and new service introductions are significantly associated with collectively held knowledge, such as codified service solutions or team‐based competences and procedures. In contrast, relying solely on tacit knowledge held by individuals may hamper innovation. The results also suggest that tacit collective knowledge is more closely associated with new service introductions, whereas explicit collective knowledge is associated with service improvements. Tacit collective knowledge is thus conducive. A managerial implication is that new service introductions necessitate team competences and routines, whereas incremental service improvements are more likely if procedures are in place to codify services into explicit solutions or technologies. Thus, the knowledge management approach should depend on the strategic orientation of the service firm toward continuous improvement of existing services or development of completely new services.     

Experiential learning of electronics subject matter in middle school robotics courses

The purpose of this paper is to investigate whether the experiential learning of electronics subject matter is effective in the middle school open learning of robotics. Electronics is often ignored in robotics courses. Since robotics courses are typically comprised of computer-related subjects, and mechanical and electrical engineering, these three areas should be emphasized equally. Many studies reveal impressive learning of computer science and mechanical engineering, but clear evidence of the effectiveness of electronics learning in the higher order thinking skills of middle school students is still lacking. We designed three different robotics courses with electronics subject matter introduced through experiential learning. A parallel group design was used, where three different open learning courses were implemented for middle school students. Based on results of the first and second implementations, we improved students’ learning of relevant content for each successive step of the experiment. In total, 381 middle school students participated in all experiments and were surveyed using pre- and post-tests. The collected data were analyzed using a quantitative research methodology. The findings revealed that the teaching approach was effective. During the learning process, student interest in robotics increased, and overall achievement improved with a medium effect size (η² = 0.13). The best results for the learning of electronics subject matter were found in the learning process (η² = 0.44), where experimental sharing of electronics parts was the most evident approach used by the students. Examination of learning material structure in light of the shared electronics subject matter is analyzed and discussed and possible directions for future research are presented.     

PDMA Research on New Product Development Practices: Updating Trends and Benchmarking Best Practices

Product development professionals may have the feeling that yet another buzzword or magic bullet always lurks just around the corner. However, researchers have devoted considerable effort to helping practioners determine which tools, techniques, and methods really do offer a competitive edge. Starting 30 years ago, research efforts have aimed at understanding NPD practices and identifying those which are deemed “best practices.” During the past five years, pursuit of this goal has produced numerous privately available reports and two research efforts sponsored by the PDMA. Abbie Griffin summarizes the results of research efforts undertaken during the past five years and presents findings from the most recent PDMA survey on NPD best practices. This survey, conducted slightly more than five years after PDMA's first best-practices survey, updates trends in processes, organizations, and outcomes for NPD in the U.S., and determines which practices are more commonly associated with firms that are more successsful in developing new products. The survey has the following objectives: determining the current status of NPD practices and performance; understanding how product development has changed from five years ago; determining whether NPD practice and performance differ across industry segments; and, investigating process and product development tools that differentiate product development success. The survey findings indicate that NPD processes continue to evolve and become more sophisticated. NPD changes continually on multiple fronts, and firms that fail to keep their NPD practices up to date will suffer an increasingly marked competitive disadvantage. Interestingly, although more than half of the respondents use a cross-functional stage-gate process for NPD, more than one-third of all firms in the study still use no formal process for managing NPD. The findings suggest that firms are not adequately handling the issue of team-based rewards. Project-completion dinners are for the most frequently used NPD reward; they are also the only reward used more by best-practice firms than by the rest of the respondents. The best-practice firms participating in the study do not use financial rewards for NPD. Compared to the other firms in the study, best-practice firms use more multifunctional teams, are more likely to measure NPD processes and outcomes, and expect more from their NPD programs.     

非营利组织体验营销的特征及组合策略研究

体验营销随着体验经济的到来而产生,并开始为各类组织所应用,但有关非营利组织体验营销的研究仍为少见。文章在文献研究与调查访谈的基础上,结合非营利组织性质展开研究,归纳了非营利组织体验营销特征并提炼出非营利组织开展体验营销的组合策略。