A Coordination-Theory Approach to Exploring Process Alternatives for Designing Differentiated Products

Naoki Hayashi and George Herman

No 4362-02, Working papers from Massachusetts Institute of Technology (MIT), Sloan School of Management

Abstract: This paper describes a new systematic method for exploring and evaluating alternatives of a product design process for differentiated products - those that share some elements but also have differentiating features. Based on coordination theory, the method clarifies the opportunities and risks of process alternatives. The method consists of three steps: 1) finding applicable differentiation approaches, 2) finding applicable patterns of process coordination, and 3) evaluating total costs of the process alternatives. We categorized the differentiation approaches as a taxonomy of design processes; the taxonomy includes approaches of adding or removing differentiating elements or sorting results. We also categorize how these are limited by type of interim resource in a design process. We outline three patterns of process coordination and how this interacts with the choice of product differentiation approaches. We show how the process alternatives vary in the success rate of the coordination and how this probability affects total cost of executing a design process. It raises an awareness of the importance of managing dependencies between activities, which many process analyses don?t focus on. We also show how to calculate the success rate associated with varying the coordination cost or how to calculate coordination cost associated with a desired success rate. These calculated values indicate ?break-even points? for the cost of the process.

Keywords: Coordination theory; Process analysis; Product design (search for similar items in EconPapers)
Date: 2002-08-12
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