New Product and Process Development (1)

김은희 , 조인성

Goodness of Fit

• 디자인의 궁극적인 목적은 form 이다 .

• Form 형성의 이유 : 세상이 완전히 regular or homogeneous 하다면 force 와 form 이 필요 없지만 , irregular 한 세상에서는 form 이 필요함 .

• 모든 디자인의 문제는 두 가지의 entities, 즉 form 과 context 사이의 fitness 를 성취하기 위한 노력으로 부터 시작되며 ,

Form : 문제에 대한 해결책을 의미 . Context 에 대한 명확한 이해를 바탕으로 디자인 을 구성함 .

Context : 문제를 정의 . 본질적 속성을 구성하는 요건 .

Design: form 과 context 를 구성하는 총체에 관한 것 .

• 즉 , 우리가 디자인에 대해 말할 때 , 진정한 목적은 form 그 하나만이 아니라 , form 과 그것의 context 를 조합하는 앙상블을 말하는 것임 .

The rightness of the form depends on the degree to which it fits the

rest of the ensemble.

• 다양한 ensemble 의 예 (p.16)

그렇다면 form 과 context 사이의 fit 를 characterizing 해보자 . • Real world 에서 우리가 다루고 있는 context 를 설명할 unitary de-

scription 은 없음 .• Context 는 매우 복잡하고 여러 변수를 동시에 고려해야 하는 속성이 있으므로

단일한 방식으로는 설명이 불가능 하고 , • Form 역시 테스트 하는 것은 비용이 많이 들거나 불가능 할 수 있으므로 • Form 과 context 는 적절한 수준에서 상호 fitness 하는 관계가

바람직하고 , 이를 위해서는 context 자체에 대한 명확하고 구체적인 설명이 필요함 .

Good fit 이란 ? • 어떤 면에서 완벽하게 만족할 만한 기준을 제공해줄 수는 없으므로 , good fit 에

대한 요구조건은 무한함 .• 그러므로 fit 에 대한 기준으로써 잠재적인 misfit 리스트를 이용함 . (ex) misfit 의 예 (p.23)

Source of Good Fit Unselfconscious culture• 교육이 규칙(general principle)이 명확하지 않은 상황에서 이루어지고 , • 노동의 분할이 한정적이기 때문에 어떤 분야에 대한 전문성이 거의 없음.• Communication 기술이 발달하지 못하여 written records 나 architectural draw-

ings 이 없고 , intercultural exchange 가 거의 없음 .• 다른 문화나 상황에 대한 정보가 거의 없고 , 기록이 부족하므로 같은 경험만 반복적으로

전해지고 , 사람들의 행위는 habit 에 의해 지배됨으로 개인이 창의성을 발휘할 필요가 없고 , 물리적 패턴을 반복하며 익히게 됨 . 따라서 같은 form 이 계속 반복적으로 만들어짐 .

• 문화의 Form-making 이 imitation 이나 correction 을 통해 informally 하게 학습되어 지면 unselfconscious culture 로 부름 .

Selfconscious culture • 교육이 formal 하게 이루어 지며 , teaching 이 명확한 규범을 기반으로 이루어짐 .

사람들은 일반적인 규칙에 따라 빠르게 더 많이 배울 수 있음 .• 공식적인 instruction 에 의지하며 , 직접적이고 명확한 원리를 알고 , 지도할 수 있는

형태로의 규칙을 만들 수 있어야 함 .• 새로운 purpose 가 항상 새롭게 발생함 . • 현대의 context 는 구조적으로 매우 복잡하고 변수 사이의 연계성이 높으므로 복잡성과

연계성에 대한 이해가 필요함 . • 문화의 form-making 이 명확한 규칙에 의해 academically 지도된다면 selfcon-

scious culture 로 부름 .

The Natural and Artificial Worlds

Natural science• Knowledge of things in the world, characteristics, proper-

ties, behavior, interaction.• Goal is to find pattern in apparent chaos. • The task of science is to show that the wonderful is not in-

comprehensible, to show how it can be comprehend- but not to destroy wonder

Artificial science:• Knowledge about artificial objects and phenomena. • Four distinctions between natural and artificial

– Artificial things are synthesized by human beings– imitate appearances of nature, but lack some aspects of reality

of natural– can be characterized by functions, goals, adaptation and– are often discussed in terms of imperatives along with descrip-

tive.

Inner environment vs. outer environment• the real nature of the artifact is the interface.• Interface is considered as a meeting point between “in-

ner environment”, the substance and organization of the artifact itself, and an “outer environment”, the sur-roundings in which it operates.

• The design artifact mediates the demands of the outer environment through a set of operative principles in its inner environment.

Design is concerned with how things to be and the nat-ural sciences are about how things are.

Optimization theory- in designing, it based on utility theory and statistical decision theory, and it is used as a logical framework for rational choice among given al-ternatives by deducing which of the available alterna-tives is the optimum.

Choosing satisfactory alternatives• A practical procedure pursuing not the best but better, satis-

factory alternatives, satisficing design solutions. • Searching for all alternatives is the computations required as-

tronomical and cannot be carried out by humans and existing or even prospective computers

design as resource allocation• Cost minimization as a design criterion has changed from im-

plicit to explicit consideration & design functions as resource allocation

In Designing• The complex system that might to be constructed in a hierar-

chy of levels• Design of complex system decompose it into semi-indepen-

dent components corresponding to its many functional parts.• Mutually rewarding conversation and experiences sharing

helped us combat our own multiple-cultures isolation

Fuzzy Front End of New Product Develop-ment

NPD (New Product Development)

10 to Front End4 to Development

1.7 Launched

One Market Success

Takes 40-60% of total development time and

determines 80% of total costs

(Smith, Reinertsen 1995, p. 49, Schmidt 1995)

Product development cycleIncremental technology improve-ments need to be motivated then an-ticipated andthen acquired. Implementation of new technology next requires research in howto embed the technology into a new model of a product, plan that new model,design, and produce the new product model.

In the product - development cycle, the technology implementation stage beginswith research (benchmarking), which then leads to product planning (nec-essaryand desired features), and then into product design before product pro-duction

Frederick Betz, "Managing Technological Innovation: Competitive Advantage From Change",

3rd Edition, John Wiley & Sons,

What is new product development?

• Ulrich and Eppinger (2004:2) define NPD as ‘the set of ac-tivities beginning with the perception of a market op-portunity and ending in the production, sale, and de-livery of a product.’

• Addressing this larger context, Wheelwright and Clark (1992: Chapter 1) defined NPD as ‘the effective organization and management [of activities] that enable an orga-nization to bring successful products to market, with short development times and low development costs.’

• Clark and Fujimoto (1991: 7) add that ‘performance re-sults from consistency in total organization and man-agement.’

C. H. Loch and S. Kavadias, Handbook of New Product Development Management: Butterworth-

Heinemann, 2007.

NPD 관련 기존 연구방향• NPD encompasses a large number of topics

and challenges in a firm, such as strategy for-mulation, deployment, resource allocation, and coordinated collaboration among people of different professions and nationalities, and sys-tematic planning, monitoring, and control.

• In that light, NPD has long been an important topic for several business research disciplines, cer-tainly economics, marketing, organizational theory, operations management, and strat-egy.

C. H. Loch and S. Kavadias, Handbook of New Product Development Management: Butterworth-

Heinemann, 2007.

Product Development: Past Research, Present Findings, and Future Directions

(1995) - Shona L. Brown and Kathleen M. Eisenhardt

• Innovation 관련 연구 분류 : – economics-oriented tradition: patterns of innovation across

countries and industrial sectors, evolution of technologies– organizations-oriented tradition: microlevel regarding how

specific new products are developed -> 이 분야에 집중

• Product development 의 중요성– Product development is critical because new products are becom-

ing the nexus of competition for many firms(e.g., Clark & Fuji-moto, 1991)

– Product development is thus a potential source of competitive advantage for many firms (Brown & Eisenhardt, 1995)

– Thus, product development is among the essential processes for success, survival, and renewal of organizations, particu-larly for firms in either fast-paced or competitive markets

눈문 구성• Product-development literature 를 three streams

로 분류– ①Rational plan, ②communication web, and ③disci-

plined problem solving– The research within each stream is theoretically and

methodologically similar.

• Synthesize these research findings into a model of factors affecting the success of product devel-opment

• Potential paths for future research

Product Development as Rational Plan

• [pioneering work] Myers and Marquis(1969) and SAP-PHO studies (Rothwell, 1972; Rothwell et al., 1974)

• This rational plan perspective emphasizes that suc-cessful product development is the result of (a) careful planning of a superior product for an attractive market and (b) the execution of that plan by a competent and well-coordinated cross-functional team that operates with (c) the blessings of senior management.

• Simply put, a product that is well planned, im-plemented, and appropriately supported will be a success.

• a product that is well planned, implemented, and appropriately supported will be a success.

Product Development as Rational Plan

[장점 ]• This broad-brush approach leads to an excellent and a com-

prehensive overview of the product-development process, which emphasizes features of the product, internal organization, and the market.

[단점 ]• The findings of many studies read like a "fishing expedition“

- too many variables and too much factor analysis. In this research stream, it is not uncommon for a study to report 10 to 20 to even 40 or 50 important findings

• the research stream relies heavily on retrospective sense making of complex past processes, usually by single informants.

• Most important, the research in this stream often presents results without relying on well-defined constructs.

Product Development As Communication Web

• [pioneering work] Allen at MIT (1971, 1977)

• early studies highlight the importance of external communication to success. Specifically, these studies observed the presence of "gatekeepers"-(i.e., high-per-forming individuals who also communicated more often overall and with people outside their specialty) (Allen, 1971).

• Von Hippel (1986) noted how important communication with key customers was regarding better product designs.

• more effective teams engaged in both political and task-oriented external communications,

• the relationship among the mean tenure of a team, the degree of external communication, and performance. but this relationship reversed and per-formance dropped off after five years.

• Two theoretical theme: information-processing view, resources dependence view

Product Development As Communication Web

[ 장점 ]• In contrast to the first perspective, this stream is narrowly focused

on one independent variable-communication. Thus, these studies emphasize depth, not breadth as in the rational plan, by looking in-side the "black box" of the development team

[ 단점 ]• the principal shortcoming of this perspective is that it is so focused

on communication by project team members that other factors are neglected.

• performance measures frequently are very subjective, and so it is difficult to know whether the results would replicate for more ob-jective measures of performance, such as product profitability.

• this stream does not distinguish between different types of prod-ucts, such as incremental versus breakthrough versus platform products.

Product Development as Disciplined Problem Solving

• [pioneering work] studies of Japanese product-development practices in the mid-1980s (e.g., Imai et al., 1985; Quinn, 1985)

• Successful product development is seen as a balancing act between relatively autonomous problem solving by the project team and the discipline of a heavyweight leader, strong top management, and an overarching product vision.

• The researchers observed that strong formal ties to suppliers and R&D networks were very important to the product-development process.

• the authors observed that product development was accelerated by overlapping of development phases and cross-functional teams only if supported by continuous communication among project members.

• senior management should engage in "subtle control."

• They(Clark & Fujimoto, 1991) reported that extensive supplier networks coupled with overlapping product-development phases, communication, and cross-functional groups (what they term integrated problem solving) improved the performance of development teams.

• Iansiti (1992, 1993) deductively examined the mainframe com-puter industry. The primary result is that a high system focus (i.e., a combination of technical integration, exposure to systems integration, and accumulation of interaction knowledge) predicted both lead time and productivity.

• One focuses on factors such as planning and overlap that are rel-evant for more stable products in mature settings (e.g., Clark & Fujimoto, 1991; Iansiti, 1992), and the other focuses on experien-tial product design that is relevant for less predictable products in uncertain settings, such as personal computers, work-stations, and peripherals.

Product Development as Disciplined Problem Solving

[ 장점 ]• In contrast to the rational plan stream, this stream is more specific

about the effective organization of work and is more focused on the development process and product concept than on the financial success of the product.

• In contrast to the communication web perspective, this stream has a broader scope and considers the role of suppliers and senior management in addition to project leaders and teams.

[ 단점 ]• One is that there is a lack of political and psychological real-

ism.• Second, some of the constructs are challenging to comprehend.

For example, subtle control, product vision, and system focus are vague concepts.

• Finally, there is an extensive reliance on a Japanese viewpoint.

TOWARDA N INTEGRATIVE MODELO F PRO-DUCTD EVELOPMENT

• Project Team• Project Leader• Senior Management• Suppliers and Customers• Financial Success

AGENDA FOR FUTURE RESEARCH

• One research opportunity is to examine the primary links of the model-that is, the links among process performance, effective product, market factors, and financial performance.– A related research opportunity is determining the relative importance of these

factors.– examine whether process performance, product effectiveness, and munificent

markets are actually independent variables.

• A second area of research is the organization of work. As was noted, two models have emerged to describe alternative organizations of work.– yet this second model(experiential product development) has received only lim-

ited empirical examination.– For huge and lengthy projects, Benghozi (1990) suggested that innovation

routines, which include dynamic planning, monitoring, and scheduling projects over time as the environment changes, are needed.

• Third, our understanding of how senior managers affect development is incomplete.

Strategy, structure and performance in product de-velopment: Observations form the auto industry

(1991) - Michael A. Cusumano and Kentaro Nobeoka

Japanese firms: integration of workers and suppliers, as well as the development and systematic application of innovative managerial and quality-control techniques for manufacturing

• product development as ideally composed of three elements: a product strategy that determines task requirements in individual projects; project structure and processes (the organization and management systems); and product as well as project performance.

Key variables

• Product strategy– product concept, which may include the pricing segment (luxury versus

economy) or size of a model, as well as the degree of new or sophisti-cated technology incorporated into different components

– Task requirements is the individual project strategy, which includes project (or task) complexity and project scope.

• Structure and process– include the internal organization and management of product develop-

ment, as well as the utilization of external resources.

• Performance– Input measures : engineering hours and “lead time”– Output measures: technical performance, styling or the match of the

product with the target customers’ tastes,– Market performance: market or production share and growth in share.

Major findings - Product strategy to perfor-mance

• Product-strategy taxonomy: high-end specialists, volume producers

• Japanese manufacturers in general displayed higher development produc-tivity in terms of engineering hours and lead time.

• Japanese firms were more dependent on suppliers than the U.S. or Euro-pean manufacturers -> reduced project scope, the number of in-house engi-neering hours as well as the amount of time projects required

• The number of model lines a company offered also correlated closely with its total sales volume.

• The specific assumption of this study, although not tested with performance data such as market shares, was that shorter product life cycles for re-placing existing models and adding new models provide an advan-tage in that faster firms can more quickly and broadly expand their product lines as well as introduce new technology or better meet cus-tomer demands as these change over time.

Major findings - Product strategy to perfor-mance

Major findings - Product strategy to perfor-mance

replacement rate: (the total number of new models in this period – the number of new models that were new product lines rather than replacements for existing mod-els,) / the number of models the firm had in the base yearexpansion rate: the number of totally new models / the number of models the firm had in the base year.

Major findings - Product strategy to perfor-mance

Design for Manufacturability (DFA): asked 19 automobile companiesto rank competitors’ products in terms of ease of assembly.

Major findings - Structure and process to perfor-mance

• Japanese manufacturers, in general, have “heavier” heavy-weight product managers than their U.S. or European coun-terparts.

• Japanese projects, in addition to their superior performance characteristics in general, had higher overlapping ratios.

• Japanese projects had more informal and intensive “informa-tion processing” among various stages that seemed to make this higher degree of overlapping possible and useful.

• Japanese auto producers developed extensive networks of subsidiaries and other suppliers, and then subcontracted huge amounts of manufacturing work as well as cooperated in technology acquisition and components development

Major findings - Structure and process to perfor-mance

Research critique

• Product strategy to performance

– Clark and Fujimoto: did not adequately treat the level of difficulty

– Sheriff and Nobeoka: do not adequately explain how they arrived at the weights used for different types of changes or components

– one project per company does not say much about which company is consistently superior in product development

– Krafcik’s productivity research, centered on assembly operations rather than components manufacturing as well as assembly.

– there is the issue of economic returns to investments in product devel-opment apart from market share• product-development performance and project complexity with changes in

sales and profits but uses financial data at the company level

Research critique

• Structure and process to performance

– no study concentrates on the supplier coordination process in product development, and there are even fewer studies on other forms of inter-organizational coordination.• pay more attention to adjusting for differences in vertical integra-

tion for development

– needs further exploration is internal project management• mechanisms through which product managers contributed to higher

design quality or higher development productivity

– multiple project coordination• Have studied only a sample of one project per manufacturer.

Technology integration: Managing technolog-ical evolution in a complex environment

(1995)- Marco Iansiti

• This work aims to fill some of the gap between these two bodies of knowledge: existing research on organizational response to technological evolution, and on the management of R&D organizations.

• Development performance under discontinuous technical change– By discontinuous, we mean that relationships between

product functionality, process requirements and disci-plinary expertise change, necessitating a substantial evo-lution in the knowledge base of the development organi-zation (as in Anderson and Tushman, 1990; Henderson and Clark, 1990).

연구 모형

In a complex environment charac-terized by technological discontinuities, high problem-solving efficiency(and development per-formance) will be associated with approaches that sample a broad base of disciplinary expertise.

System-focused organiza-tions will be associated with high levels of development performance in environ-ments characterized by dis-continuous technological change.

System-focused organizations willbe associated with a broader approach to solving problems than other organizations-this will involveinformation search and process-ing activities that cross a broader base of existing disciplinary exper-tise.

Empirical approach

• Mainframe processor, 27 projects, 61 problem-solving efforts

Empirical results - Problem solving and performance

큰 문제해결 폭은 더 작은 person year( 더 큰 생산성 ) 더 빠른 개발속도

개발성과 지표 ( 종속변수 ): person year, 개발시간 R&D 조직에서의 지식의 진화와 관련 있음 - disciplinary knowledge bases are linked to each other Integration group members had managed to resolve a difficult problem early by framing it broadly and by making use of a novel combination of context-specific knowledge bases.

P1 성립

- 개발성과와 context-specific breadth 는 유의- 개발성과와 context-independent breadth 유의하지 않음

<P1> In a complex environment characterized by technological discon-tinuities, high problem-solving efficiency(and development performance) will be associated with approaches that sample a broad base of disciplinary ex-pertise.

Empirical results - System focus and performance

<P2> System-focused organizations will be associated with high levels of development performance in environments characterized by discon-tinuous technological change.

System focus 와 개발성과 (person year, 개발시간 ) 와 유의 (-) 하게 나타남 (0.1%수준 )

< 표 6> The correlation between individual

indicators of system focus(Table 2) and

development speed and productivity

(-) 의 유의한 상관성

System focused 프로세스는 개발성과와

연결됨을 보여줌

P2 성립

Empirical results - System focus and performance

<P3> System-focused organizations will be associated with a broader approach to solving problems than other organizations-this will involve information search and processing activities that cross a broader base of existing disciplinary expertise.

P3 성립

문제해결의 폭은 system focus 와의 관련성이 유의적으로 있음을 보여줌 (0.1%수준 )

문제해결의 넓이 ( 폭 ), system focus, 개발성과간의 논리적 고리

Empirical results - Development process and problem-solving approach

System-focused orga-nizations:do a good job of identify-ing potential problem areas early in the project, before con-cept selection was completed.

Discussion

• Literature Review Paper v.s. Empirical research

• Physical Product 와 Software Product 는 어떻게 다른가 ?

• NPD v.s. NSD(New Service Development)의 유사점과 차이점은 ?

• 미국에서의 일본 및 한국 차에 대한 품질 이슈를 어떻게 봐야 할 것인가 ?

• 제품의 출시 간격이 시장 성과에 미치는 영향은 무엇인가?– 주기적 구매 제품 ( 자동차 , 스마트폰 , …)– 비주기적 구매 제품

[ 첨부 ] Past overviews of NPD re-search - 1

[ 첨부 ] Past overviews of NPD re-search - 2

[ 첨부 ] Past overviews of NPD re-search - 3

[ 첨부 ] Elements of evolutionary problem solving

Shane, Scott, Handbook of Technology and Innovation Management, John Wiley & Sons Ltd., 2008

Creation of variation - Guided creation - Unguided creation

Selection - Mental selection based on representa-tion - Selection with no representation

Retention / Inheritance - Reproducible actions - Unstable system / noise