Product development (dilemas)

Question 1

Discuss five reasons why it can be beneficial to bring competitive products to the market more rapidly than competitors

Answer 1

• longer product life,
• longer pay-back time,
  relation to market demand,
  faster use,
• higher market prize in the beginning gives shorter pay back time
• scale effects,
• set the industry standards ( VHS vs. Betamax)

Question 2

What is the purpose of creating an aggregate project plan and discuss some issues managers must confront in developing such a plan

Answer 2

The purpose is to ensure that the collective set of projects will accomplish the development goals and objectives and build the organizational capabilities needed for ongoing development success (W&C p 48). The issues relates to resources per project and total resources, types of projects, mix and sequence, as well as relationship to strategic issues

Purpose: How to manage resources – avoid overload
Issues: Set clear and measurable goals. Avoid cannibalization. You can’t do every project you have to choose some.
Purpose - see that the projects are in the right direction, align with the company goals, balance the projects in time and direction
1. Balance of projects – long and short term
2. Develop capacity plan - prioritizes the projects
3. Examine how projects will contribute and manpower needed (taken from other projects)

Issues: set clear and measurable goals. Have to see link between strategy and PD and how things are affected. Avoid cannibalization (don’t launch a derivative and a new platform at the same time). Choose a platform which can have hyper variety.
An aggregate project plan provides management with a categorized list of projects, which balances short-and long term goals. This list assists management in making difficult decisions such as when to start projects and which projects should be cannibalized. Starting projects in a sequential manner according to the firm’s strategy as well as resources available will allow fewer projects to continue simultaneously and improve productivity. (wikipedia)

Question 3

describe the basic types of projects according to Wheelwright & Clark

Answer 3

• Research or advanced development projects – inventing new science and capturing new knowhow
• Radical breakthrough development projects – the first generation of an entirely new product/process, may lead to entierly new business models/areas
• Platform or next generation development projects
• Meet the needs of customer with a targeted system solution
• Adaptable and expandable
• Links to past and future, build continuity
• Derivative development projects – “incremental” development projects ( facelifts )
• Partnered projects – Organizations can share their resources to conduct research or run development projects either to find new solutions together or share information between organizations, can be used in all stages of development and research

Question 4

Speed and flexibility in product development are needed capabilities today, discuss five important underlying driving forces to that

NEEDS UPDATE

Answer 4

R&D lead times,
product life-cycles,
costs, 
changing technologies, 
complexity,
competition, 
markets, 
environmental concern. WHY, WHAT and HOW.

Question 5

Describe “Dominant Design”

Answer 5

Dominant design is the general design that after a initial diverse portfolio becomes the industry consensus about which design is “the best”

Visualize the early phase of cars that lead to the sedan that looks similar regardless of manufacturer.

Question 6

Describe - not list - 5 different ways to source needed technology

Answer 6

• Internal R&D – develop the technology inhouse. Most commonly used.
• Technology purchasing – buying the technology, for example buying patent or license(?) this means that the technology is developed by another company.
• Acquisitions – a company is acquired that holds the desired technology and knowledge
• Joint ventures – Companies in joint ventures can benefit from exchange in technologies. For example company A owns technology X and company B owns technology Y. They both get access to technology X and Y.
• Scanning - Quick adapter / copy paste

Question 7

What are the goals with Project portfolio management and describe one method and/or tool that can you use in order to achieve these goals respectively

Answer 7

Goals: Linking portfolio to strategy, Balancing scarce resources between projects, Hedging portfolio for future, planing number of simultaneous projects

Tools: bubble diagrams, scoring model, histogram, financial models, business strategy models

• First, portfolio management is about making strategic choices. It is one route by which senior management operationalizes their business’s strategy—the types of products, markets, and technologies management has chosen to attack, and the relative emphasis on each.
• Second, the new product and technology choices that management makes today determine what the business will look like 5 years out.
• Third, portfolio management is about resource allocation, the allocation of scarce and vital R&D, engineering, marketing, and operations resources at a time when these resources are more stretched than ever.
• Finally, portfolio management deals with the critical issue of balancing resources available with the numbers of projects. Errors here—for example, trying to do too many projects for the limited resources available—results in longer cycle times, poor quality of execution, and underperforming new products.

Question 8

Managing R&D is really much about management of dilemmas. Describe three typical managerial dilemmas or “trade-offs” that commonly needs to be handled by R&D managers

Answer 8

time vs. cost and quality, one product vs. a family of products, market pull vs. technology push

Question 9

Discuss important questions that must be addressed by a product/market strategy for a business.

Answer 9

What – products will be offered?

Who – will be the target customers?

How – will the products reach those customers?

Why – will customers prefer our products to those of competitors?

Question 10

Quite often management’s involvement only becomes significant late in the project, around the time when prototypes are being built. Why can this be a problem?

Answer 10

If the different departments collaborate from early on they can identify problems in an early stage and avoid extra costs. A problem can be that the product does not match the strategy. Management needs to be involved from the beginning because there are some “trade-offs” that need to be handled.

Question 11

Describe three potential benefits of effective development efforts according to Wheelwright and clark ( NEEDS ANSWER)

Answer 11

NEEDS ANSWER

Question 12

What is the objective with engineering maps?

Give an example of an engineering map

Answer 12

NEEDS ANSWER

Question 13

Discuss five typical themes (reasons to) in ineffective (problematic) development projects

Answer 13

• Multiple and/or ambigious objectives → long planning stage, late conflicts and too big efforts to reach concensus
• Focus on current customers instead of the target group → Moving targets, late re-design as a result of missunderstanding of market.
• Focus on elegant engineering solutions instead of performance → Missing existing deadlines which leads to overtime at the end of the project
• Solve problem when they occur instead of proactive engineering → Late changes, poor manufacurability, unrepresentative prototypes,
• Unclear direction, on clear leadship, limited accountablity → Lack of a shared and coherant vision, many false starts and dead ends.
• Narrow specialists in functional “chimneys”, as opposed to cros-functional teams. → Miscomunication, “not in my job-description”, misdirected effort

Question 14

Describe the three potential sources of advantage that comes from the ability to move quickly in product development

Answer 14

Quality of design: With a shorter time to market (TTM), one can make more precise estimations of customer needs and also utilize market pull instead of technology push. In other words, lower uncertainty and therfore make better estimations of market needs.

Product Performance: With shorter TTM one can introduce new technology faster, and more frequently than the competittion. This will eneble monoploy pricing models and therefore increase profit, and also lower NPV of projects for compettitors.
A shorter TTM might also increase the inclination of the company’s learning curve with regards to compettition, this will ensure that the products have better performance than competing products.

Market share and cost: In a low margin market which is sensetive to volumes a short TTM can also be utilized to gain market share and therby lower the unit price of components due to economics of scale given that one don’t utilize the monoploy pricing.