Product Development Process Design: Improving Development Response to Market, Technical, and Regulatory Risks

Year: 2003
Author: Unger, Darian W.
Supervisor: Eppinger, Steven D.
Institution: Engineering Systems Division, Massachusetts Institute of Technology
Page(s): 205

Abstract

Engineering companies frequently face product development challenges. Competitive pressures, industrial or societal innovations, and government regulations are some of the many factors that drive the need for new or better products. Companies respond to these drivers and changing needs by developing new products and employing product development processes (PDPs) to coherently manage the risks inherent in their development. Well-designed PDPs reduce development time, create better products, generate profit, and increase market share. In contrast, poorly-designed PDPs can severely harm both product lines and the companies that manufacture them. Many companies seek guidance in making important PDP design decisions. This thesis introduces PDPs as risk management frameworks. The research investigates the relationship between PDPs and risk management and seeks to help companies improve PDP design. It begins by discussing the drivers and risks of product development and then describes different PDPs. The traditional stage gate process is compared with the modified waterfall process, evolutionary prototyping, evolutionarydelivery, design to schedule/budget process, the spiral process, and several other PDP variations. The research then proposes several iteration- and review-based metrics by which PDPs can be more effectively identified and compared. Ten company case studies exemplify a wide variety of actual PDPs, demonstrate the utility of iteration and review metrics in distinguishing PDPs, and illustrate how different processes manage different risks. Case study findings indicate that software development companies face rapidly-changing markets, generally perform quick integrations and tests, and are likely to employ flexible PDPs. In contrast, manufacturing companies that face greater integration difficulties and technical risks are likely to employ more rigid PDPs. Integration and risk are both instrumental in determining the applicability of different PDPs. The research employs case study lessons to propose a method for improved PDP design based on risk and integration. To demonstrate the method, it is applied to one company. The thesis concludes that PDPs vary more than previously documented; that the proposed metrics are useful in distinguishing PDPs, their different integrations, and their different risk management methods; and that companies facing different risks can more thoughtfully tailor their PDP designs to suit their own unique circumstances.