Role of IT in Collaborative Product

Development Process

SUBMITTED BY:GROUP O2
Harini Valluri
Soman Nahata
Ankit Jangalwa
Gandharv Raj Sethi
Vishwajeet Narayan

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OBJECTIVE:
Recently there is a widespread use of software and Internet based collaborative methods for
the product development process. Analyze the various tools and techniques adopted by
firms to exploit developments in software and IT/Internet infrastructure and submit a
detailed report. The report should cover the following aspects:

a. Various software available for improving the design productivity and the manner in
which these tools help the product development process
b. The role of the Internet in promoting collaborative product development process
c. Recent successful examples of firms that have utilized these options for product
development
d. Implications of these developments for the product development in the future

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Table of Contents

SUBMITTED BY:GROUP O2...................................................................................................................... 1

OBJECTIVE: .............................................................................................................................................. 2
INTRODUCTION ....................................................................................................................................... 4
BACKGROUND ......................................................................................................................................... 4
PRODUCT DEVELOPMENT VIA SOFTWARE TOOLS.................................................................................. 5
ROLE OF INTERNET IN PROMOTING COLLABORATIVE PRODUCT DEVELOPMENT PROCESS ................. 7
FIRMS USING INTERNET FOR PRODUCT DEVELOPMENT ...................................................................... 10
IMPLICATIONS OF THESE DEVELOPMENTS FOR THE PRODUCT DEVELOPMENT IN THE FUTURE ........ 10

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INTRODUCTION
Global competition and rapidly changing customer requirements have resulted in great changes in
product development style. Traditionally centralized and sequential product design, planning and
scheduling activities are inadequate to respond to the dynamic variations in new product
development cycles. With the advent of the Internet, product development activities are
increasingly more distributed. In addition, virtual enterprises and dynamic alliances become the new
organizational forms for modern product development.

Recent advances in computing and communications technology, most notably in computer

networks, promise substantial changes in the way businesses operate. Computer networks can
connect geographically dispersed businesses and allows commercial data to be transmitted quickly
and accurately. As a result, the geographical and time boundaries between businesses and other
related parties can be reduced. Networked product development is a new product development
pattern that allows multi-disciplinary teams distributed in different locations to remotely collaborate
over the Internet.

The Internet can be the basis for product

development, information sharing, resource sharing,
knowledge sharing and task assigning between
different businesses. This can improve product
quality and decrease development time and cost. The
framework of networked product development is
shown in Fig. 1.In this framework, XML, VRML, HTML
and Java technologies are used to integrate product
information, processes and knowledge. Networked
product development is ideal for rapidly organizing
resources to respond to market requirements and to
develop and produce quality products faster and
cheaper.

BACKGROUND
Since the late Seventies industrial companies have experienced changes involving all of their
activities as a result of a broad range of predominantly organizational and managerial innovations,
including Just in Time (JIT), Total Quality Management (TQM), Concurrent Engineering (CE) among
others. This process of change has been so radical as to suggest that a new production paradigm has
emerged. Womack and Jones 1996 proposed that Lean Production is the practical realization of the
new paradigm, but this has been questioned. Nevertheless, the emergence of Lean Production has
encouraged production to be analyzed as being composed of three core phenomena: product
development, order-delivery and production proper, all of them focusing on the customer.

It has been widely argued in the literature that there is a lack of consolidation of operations
management theory, mostly due to different views and approaches that had emerged over the last
thirty years. Similarly, design science lacks sufficient scientific foundation and consequently product
development has been too much guided by intuition and experience. The debate over the
replacement of mass production by Lean Production created an opportunity to extend this
theoretical basis. This is the purpose of the TFV (transformation, flow and value generation) theory
proposed by Koskela (2000), which has been used as the conceptual basis for this research.

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PRODUCT DEVELOPMENT VIA SOFTWARE TOOLS
Effective product development is a prerequisite for profitable growth, and it's essential to the
success of business. But for successful product development, one need to manage product data,
engineering changes, and overall costs in an integrated way – with comprehensive product
development software that's easy to install and easy to use.

The product development software enables the engineers to manage all data and costs in an
integrated environment. And, it provides full visibility and control.

With product development softwares, one can reduce time to market and increase product
profitability as you reduce design cycles and improve collaboration. A flexible collaboration network
helps align design, procurement, manufacturing, and service, so you can:
I. Increase the speed of innovation
II. Reduce time to market by integrating disconnected product design and development,
procurement, and manufacturing silos
III. Enable flawless development collaboration to avoid time wasted
IV. Reduce product costs by optimizing product components and streamlining design
V. Ensure regulatory compliance of products through transparency in the product definition
phase

There are many software tools available in the market which helps in the product development
process. Some of the popular ones are:
1. PLM (SAP Product Life Cycle Management):
SAP PLM is part of the SAP Business Suite, which gives organizations the unique ability to
perform their essential business processes with modular software that is designed to work with
other SAP and non-SAP software. Organizations and departments in all sectors can deploy SAP
Business Suite software to address specific business challenges on their own timelines and without
costly upgrades.

2. ProductVision:
ProductVision, developed by Advanced Software Design, provides product life cycle
management (PLM) for full tracking of a product from inception through production and eventual
retirement. From Sales and Marketing to Research & Development, Regulatory, and Production,
ProductVision allows your team members to share ideas and work together towards a common goal.

3. Microsoft Visual Studio:

Microsoft Visual Studio is an integrated development
environment (IDE) from Microsoft. It can be used to
develop console and graphical user interface applications along
with Windows Forms applications, web sites, web applications,
and web services in both native code together with managed
code for all platforms supported by Microsoft Windows, Windows Mobile, Windows CE, .NET
Framework, .NET Compact Framework and Microsoft Silverlight.
Microsoft first released Visual Studio (codenamed "Boston") in 1997, bundling many of its
programming tools together for the first time. Visual Studio 97 came in two editions, Professional
and Enterprise It introduced Visual InterDev for creating dynamically generated web sites using
Active Server Pages. A snapshot of the Microsoft Developer Network library was also included.

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4. Computer Aided design(CAD):
Computer-aided design (CAD), also known as computer-aided
design and drafting (CADD), is the use of computer technology
for the process of design and design-documentation. Computer
Aided Drafting describes the process of drafting with a
computer. CADD software or environments provide the user
with input-tools for the purpose of streamlining design
processes; drafting, documentation, and manufacturing
processes. CADD output is often in the form of electronic files
for print or machining operations. The development of CADD-
based software is in direct correlation with the processes it seeks to economize; industry-based
software (construction, manufacturing, etc.) typically uses vector-based (linear) environments
whereas graphic-based software utilizes raster-based (pixelated) environments.

5. Computer Aided Manufacturing (CAM):

Computer-aided manufacturing (CAM) is the use of computer software to control machine
tools and related machinery in the manufacturing of work-pieces. CAM may also refer to the use
of a computer to assist in all operations of a manufacturing plant, including planning,
management, transportation and storage. Its primary purpose is to create a faster production
process and components and tooling with more precise dimensions and material consistency,
which in some cases, uses only the required amount of raw material (thus minimizing waste),
while simultaneously reducing energy consumption.

6. Microsoft Visio:
Microsoft Visio marketed as Microsoft Office Visio, is
a diagramming program for Microsoft Windows that uses vector
graphics to create diagrams. Whether you’re capturing existing
business processes, analyzing your supply chain, or monitoring
business process performance, Microsoft® Visio® 2010’s new tools
and more intuitive interface make it easier for business and IT
users to map processes and share business insight across the
organization.

7. Enterprise resource planning (ERP):

An Enterprise Resource Planning (ERP) system is an integrated
computer-based application used to manage internal and external
resources, including tangible assets, financial resources, materials,
and human resources. Its purpose is to facilitate the flow of
information between all business functions inside the boundaries
of the organization and manage the connections to outside
stakeholders. Built on a centralized database and normally utilizing
common computing platform, ERP systems consolidate all business
operations into a uniform and enterprise-wide system environment.
This software is widely used for whole process development process starting from the nascent
phase of the idea generation to the product completion. It also takes care of the supply chain
management. There are lot many companies who have their own version of ERP systems. The
actively involved companies are SAP, ORACLE, IBM, Microsoft etc.

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 8. Statistical Analysis System (SAS):
Base SAS provides a scalable, integrated software environment
specially designed for data access, transformation and reporting. It
includes a fourth-generation programming language; ready-to-use
programs for data manipulation, information storage and retrieval,
descriptive statistics and report writing; and a powerful macro
facility that reduces programming time and maintenance
headaches.
The other benefits are:
I. Integrate data across environments.
II. Read, format and analyze any data.
III. Make programming fast and easy.
IV. Simplify reporting.
V. Maximize use of all computing resources

These software tools have a significant impact on each phase of the product development process.
Right from the beginning i.e. idea generation step to testing, implementation, pricing and
commercialization, each step has its own tools. The development process has been simplified by
using these systems: Modelling software can help in idea generation and design of the new product.
Creating a virtual environment via software can help in proper testing of the product as well give the
actual knowledge of the environment (internal as well as external).

ROLE OF INTERNET IN PROMOTING COLLABORATIVE PRODUCT DEVELOPMENT

PROCESS
Collaborative product development (collaborative product design) (CPD) is a business strategy, work
process and collection of software applications that facilitates different organizations to work
together on the development of a product. It is also known as collaborative product definition
management (cPDM).

The speed, convenience, interactivity, and worldwide coverage of the Internet match the
requirements of the different activities in the collaborative product development (NPD) process,
which involves uncertainties and risks and requires firms to take into account the views of customers
and to introduce their new products to the market fast.

Research has consistently shown that a high-quality process is one of the most critical success
factors in the collaborative product development. Although different firms may adopt different
types of product development process, the typical process generally includes such discrete and
identifiable stages as the preliminary investigation, detailed investigation, development, testing and
validation, and market launch. Activities at each stage are undertaken by cross-functional teams and
conducted both sequentially and simultaneously. Throughout these phases, strategic decisions are
made about whether to go ahead with a new project or modify it or kill it. The following sections
examine these phases in more detail and explain how the Internet can be used at each step to
enhance the effectiveness of the process.
1. Preliminary Investigation:
This stage involves "up-front" market, technical and financial assessments of new product ideas. As
its title implies, this stage deals with an initial evaluation of new product ideas and preliminary
appraisal of other potential factors that might affect the success of the new product ideas under
consideration. Every new product starts with an idea, and companies at this stage generate as many
ideas as possible for further consideration. Indeed, numerous experiments have shown that online

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idea-generation sessions generate more unique and quality ideas than do face-to-face sessions and
that the participants are significantly more satisfied with this type of meeting.
Thus, the Internet can offer a viable platform for electronic idea generation by individuals in
different parts of the world.

Companies are increasingly using the Internet for this purpose. For example, Polaroid Corp. used
Internet-based methodologies to develop its highly popular i-Zone, which prints mini-photos that
can be stuck anywhere. The company asked several hundred representatives of its target population
to visit a private online research site and assemble their ideal i-Zone with different features that they
valued. The results suggested that the respondents viewed the product as a fashion accessory and
wanted "cool" styles. These characteristics of i-Zone were totally inconsistent with the features that
some Polaroid engineers originally envisioned, which were more technical and costly. The Internet
allowed the company to understand its customers better and thus design the products they wanted.
At the preliminary investigation stage, the Internet can also allow companies to collect market
intelligence and identify market trends, thus being able to assess the viability of their new product
ideas more effectively before making substantial commitments to further development of these
ideas.

Firms can certainly generate ideas by searching the web sites of their competitors and other related
firms. However, they should keep in mind that such ideas may not always work for them, as their
industries and company realities may not be comparable. For instance, anyone can visit the web site
of Dell Computer and try to learn about its business models, prices and products.

2. Detailed Investigation:
Firms at this stage conduct a more comprehensive study to build a business case for the new
product idea so that it can be developed further. Activities at this phase include more detailed
market and technical assessments as well as detailed financial and business analyses.

A key activity at this stage is the identification of suppliers for the new product ideas. The Internet
can help to locate a suitable supplier within a short period of time. At this stage of its new product
development process, Dynacut Inc., a producer of diamond saws, abrasive saws and cutting systems,
needed to find a source for a high-speed and high-precision aircraft aluminium rotary seal housing
with a tolerance of 0.0005 inch for its new prototype. Unable to find a local supplier, the firm used
the Internet to search for a supplier and get a price quote. It was able to receive four quotes from
qualified suppliers within a week. Without the Internet, the company usually spends two months to
identify local suppliers and waits for a few more weeks to receive a price quotation. In addition, as
soon as it received the price quotations through the Internet, it started to collaborate with the
suppliers on part designs, ask questions and seek advice from other experienced professionals
through the online message boards.

Online auctions are a special case of identifying suppliers through the Internet. Firms can post a
request for quotes for the items necessary to develop their new products in such auctions in order
to estimate the costs of the items and to determine suitable suppliers of the items.
Governmental and non-governmental online sites offer a great deal of economic and demographic
data, which can be useful in predicting potential market size for a new product. In addition, such
data sources can also provide information about market conditions, market share, tax regulations,
foreign investment, and a host of other relevant information for different countries so that those
companies interested in pursuing global markets can conduct business analyses for their target
markets.

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 3. Development:
The strategy at this stage is to convert the new product idea that just passed the detailed
investigation phase into a new product/service. This stage may require the interaction of people
from R&D, engineering, marketing, and other functional areas. It may also require the opinions of
suppliers and distributors in the potential supply chain of the new product idea. Furthermore, firms
operating in multiple countries may need to conduct their NPD activities in different regions of the
world.

The Internet can play a crucial role in the coordination of the NPD activities. More specifically, new
product team members in different parts of the world can communicate with each other quite
effectively and exchange documents, product designs, and software over the Internet easily. For
example, Lockheed Martin uses an Internet-based system among its authorized suppliers, partners,
subcontractors, customers, and its employees in design, engineering, manufacturing, and work flow
management of its new Joint Strike Fighter (JSF) airplanes.

The system allows anyone connected to it to share and use files online. The employees can
participate in online sessions and discuss different aspects of the product design. According to the
company representatives, this ensures that people in different parts of the world have the same
understanding of the product design and that new products are built correctly and quickly.

4. Testing and Validation:

At this stage of the process, companies make sure that a new product or its prototype functions
properly before it is commercialized. The Internet is a convenient medium for testing computer-
related products/ services, and many software companies use it to test new software applications.
They make their prototypes available on the Internet so that people can download them and provide
feedback about the software. Companies can also send a new software application to designated
users and ask them to evaluate it under real usage conditions. For example, with the help of the
Internet, the Tompkins Group and its clients in remote locations work together online to test,
validate and debug a new software application.

In addition to testing software products, companies can utilize the Internet to test their Internet
services. They can test whether the links in their web sites are accurate, whether links to and from
other web sites are valid, and whether their sites work with different Internet browsers (30). For
example, Staples Inc. tested its web sites for factors such as download times and site search engines
before it re-launched them. In addition, in order to improve its web sites, the company has been
visiting customer workplaces to find out how individuals use its sites when ordering supplies.
Firms can also use the Internet to test their non-computer-related new product ideas or prototypes
more efficiently and effectively. One of the key advantages of online product testing is that it is so
flexible that companies can produce multiple animated prototypes and test them in a short period of
time. It should be particularly relevant for new products that require expensive physical prototypes.
The online portals can also be used for creating awareness about the product.

The organizations have understood the importance of internet and its implications on the product
development process; hence they have started to shift their operations online.

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FIRMS USING INTERNET FOR PRODUCT DEVELOPMENT
There are many firms, both in manufacturing sector and services sector which uses internet for their
product development.

Category Internet Application

Polaroid Inc. Generating ideas from customers.
Dynacut, Inc. Identifying and selecting suppliers for new products.
Lockheed Martin Collaboration in product design.
Corp.
Xerox Corp. Coordination of global NPD Activities.
Hang Seng Bank Offering new product information on company web site.
PCCW-HKT Limited Creating public awareness for new products through popular online portals.
Hutchison Telecom Offering new product information

IMPLICATIONS OF THESE DEVELOPMENTS FOR THE PRODUCT DEVELOPMENT IN

THE FUTURE
In many respects, the product development industry is a mature industry. Many basic patents will
soon expire. The fundamental manufacturing technologies will become purchasable. In future, most
commodities will be ubiquitously available. Thus, most of the differentiation characteristics that
were decisive in the past will no longer play a role. In industrial countries, which have a high
purchasing power, people's needs in fields like health, nutrition, communication and mobility are
covered to a great extent. The markets are reaching their respective growth capacities. Instead of
technological innovations, pure marketing strategies are increasingly significant for the success of
selling a product. Globalization leads to toughening competition. But the free flow of information
and the removal of bureaucratic barriers have not just globalized the market for new products but
intensified competition. There is also a high level of competition for the decisive production factors
of capital and personnel amongst organizations as well as the most attractive companies from other
industries.

Business models of the future

In order to survive in this intensified competitive environment, companies have to specialize and
concentrate on their core competencies. The limited capital and personnel resources of a company
and the considerable expenditure for future investments which are necessary for a stable and
promising competitive position do not permit an equal promotion of all the traditional business
operations.

In the strategic assessment of the different business operations, criteria such as market
attractiveness, market size and growth rates, the market position that has been achieved, the
technological position, profitability and the strategic fit to other operations, all play a role.
Consistent application of these criteria produces an assessment sequence for the individual activities
in the company portfolio. This provides management with a basis for investment and divestment
decisions. Business activities that no longer belong to the company's core business are divested.
Management can then look towards strengthening those activities that are thought to be promising.
In addition to the trend towards specialization and concentration, there is a very noticeable upward
trend in size. To be able to play a decisive role in the expanded global markets, individual markets
must be developed in a targeted manner. Only companies with sufficient critical mass have the
financial resources necessary for this. Even more important, the size factor is highly significant for
the company's market and competitive position. Only those companies that are at least number 3,
better still number 2 or the absolute market leader can actively compete from a strong position. It is

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absolutely vital for a company to have a leading market position if it is to achieve stable earnings. In
the long term this can be achieved by means of internal growth or, in a much shorter time, by
merging with companies that are active in the same field. The business model of the future will no
longer be the broadly diversified as of the past, but rather a provider focussing on the special
products of its (few) business operations that have a leading global market position. Depending on
the product portfolio, a distinction can be made between various categories of providers.

The internet and the softwares are already and will play a vital role in the product development
process. As mentioned in the above section, we have got a glimpse of the advancements in the
product development process as well as the industry. The further developments in the information
technology will help smoothing the whole development process. The Web-sharing model would be
extensively used in the whole process.

The use of other technologies like email, chat , conferencing methods are going to be the base in the
development process. The use of internet in the marketing process is going to be the strength of the
organizations. Gathering and analyzing the feedbacks would become a common process for
analyzing the market. As per the costing, IT department would be established which would consider
the online needs of the company and this department will have a distinct place in the budget of the
organization.

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