The Collaborative New Product

Development Process
- its development, use and impact on today's innovation efforts
Ingvild Sundby
Department of Product Design
Norwegian University of Science and Technology

ABSTRACT

This paper explores the development and use of the collaborative new product development (NPD)
methods which have emerged in companies around the world for the past 20 years. The methods, such as
Concurrent Engineering (CE) and Integrated Product Development (IPD), were introduced to achieve
shorter time-to-market by gathering all of the involved departments at the initial phases of the process.
This early collaboration is supposed to ensure better communication and planning, thus avoiding time-
consuming remodeling later. Today, the collaborative efforts are characterized by cross-functional teams,
strong customer focus and use of visualization tools. Results from implementation are promising, and
leading innovators like Procter & Gamble, BMW, Toyota and IBM have all in the recent years made use of
collaborative principles in their NPD processes. The paper ends with a discussion of what impact the
collaborative methods have had on today's innovation efforts.

KEYWORDS

Collaboration, Innovation process, Cross-functionality, Concurrent Engineering (CE), Integrated Product

Development (IPD), Dynamic Product Development (DPD), Design, Anthropology, User Experience.

start of a project in order to avoid time consuming

1. INTRODUCTION
Methods for innovating faster and better in order to
gain competitive advantage has been on the mind of
business leaders for hundreds of years – from the
scientific management of Fredrick Taylor to the
creative philosophies of IDEO. One of the most
important means for achieving success has been
viewed as being first to market, and this particular issue
has been the subject for considerable study and
discussion throughout the years.
One of the hindrances of faster developing time has
been identified as the “over-the-wall” issue stemming
from the sequential process where departments receive
the result from the previous department’s work without
having communicating before hand, resulting in time
consuming patching-up before commencing on their
actual tasks. The efforts for dealing with this issue have
included collaborative new product development
(NPD) methods where all participants gather at the
remodeling later in the process. The most known
methods include concurrent engineering (CE),
integrated product development (IPD), the Stage-
Gate© model and dynamic product development
(DPD). Even though largely covering the same issues,
there is some dispute over how to best make use of
these methods in an innovation aspect.
In this paper I will describe the background and
principles of the different collaborative methods, and
review some of their reported weaknesses and
strengths. At the end, I will discuss what impact the
introduction of these methods has had on the way
today’s companies innovate. The paper is based on
several articles and books from the fields of
engineering, business, design and innovation, and is to
be regarded as a review and reflection of literature, and
not as a detailed description on how to implement a
collaborative NPD method in a business environment.

The Collaborative New Product Development Process 1

I would also like to note that I have chosen to use the
terms “collaborative new product development”,
“collaborative efforts” and “collaborative innovation”
when describing common features of the mentioned
methods. These are however not commonly
incorporated scientific terms, and are used for the
cause of convenience in this paper.
2. THE COLLABORATIVE NPD METHODS
2.1 Background
How the West thinks about organization and
innovation is influenced by Fredrick Taylor’s work in
the beginning of the 20th century. Taylor's ideas on
scientific management lead to a revolution in
production time. The traditional way of one craftsman
making all the features of a product himself, as well as
maybe marketing and selling, was abandoned in
advantage of separated divisions of labor which
reduced time to market and cut manufacturing cost
radically [1].
At about the same time as Taylor wrote his then
innovative works, Thomas Edison set up his famous
lab in Menlo Park in New Jersey[2]. This factory of
inventions characterized by a free flow of information
between scientists from different disciplines, produced
400 patents in 6 years, and can be seen as an early
example of a successful cross-functional innovation
process. It was however the Taylor way which prevailed
in the hundred years to come. Most companies today
are divided in different departments dealing with
specialized tasks.
For some time though, weaknesses of division of labor
have become increasingly evident[3]. In a world where
everything happens so fast that change in production
procedures may occur within a few weeks, rigid
bureaucracy and operations are more of hindrances
than boosters for growth. The expense of the time
consuming “over-the-wall” approach where one
department does their work on a project and then
“throws it over the wall” to the next department in a
fairly Tayloristic manner, is a problem that business
leaders and researchers have become more and more
aware of. The realization has lead to the development
of new collaborative product development methods
characterized by cross-functionality, customer focus,
use of information- and communications technology
The Collaborative New Product Development Process
(ICT) and visualization techniques like rapid
prototyping.
2.2 Concurrent Engineering (CE)
The western introduction to the collaborative
innovation process may be related to Ford's
development of the Ford Taurus in the early 80s which
included aspects like cross-functional teams and
geographical collocation. The process was inspired by
development methods in the Japanese car industry
which at the time was considered a serious threat to the
American industry. Fortunately for Ford, the result of
the new process was a highly holistic product which
turned out to be the most sold car of its time in the US.
The project was however 6 months late, and the
manager got fired because of it. The next version
underwent a lot more sequential based development
process with strict time control, and although finishing
according to plan, the car was by far not the same sale-
success as its predecessor[4]. Consequently, one may
say that the first collaboration effort at Ford was a
mixed success.
In 1987, The Defense Advanced Research Projects
Agency (DARPA) followed up with an extensive survey
on the matter, naming the process Concurrent
Engineering and created a definition[5]:
Concurrent engineering is a systematic approach to the
integrated, concurrent design of products and their related
processes, including manufacturing and support. This
approach is intended to cause the developers, from the
outset, to consider all elements of the product life cycle from
conception through disposal, including quality, cost,
schedule, and user requirements.
The DARPA-project resulted in wide implementation
of concurrent engineering in government departments,
like defense, aerospace and automobile. This initiated a
chain reaction among the industries suppliers and
subcontractors, and led to a wide recognition of the
method in the U.S. [6]. Since then, the term has
undergone several interpretations, and understandings
of the method seems to vary quite a lot. In her book
“Implementing concurrent design in small companies”
[7], Susan Carlson Skalak suggests the following
characteristics for describing the CE process:
• Customer focus and involvement
• Early and continual involvement of suppliers in the
2
 design process Company Name Cost-related Savings
• Cross-functional, self-directed, empowered teams (Direct/Indirect)
• Incremental sharing and use of information Hewlett Packard: 42% reduction in manufacturing
• Life-cycle focus Instrument Division cost
• Systematic and integrated approach
• Concurrent (parallel) design teams Northrop Apprxm. 30% savings on bid on
a major ticket item/product
• Early use of X (DFX) tools
• Use of modern tools such as CAE, CAD, CAM, AT&T At least 40% reduction in the
finite element analysis etc cost of repair for new circuit
• Continuous improvement of all processes pack production
IBM 45% reduction in product direct
All of these ingredients may help reduce development assembly labor hours
time. Early customer participation can lead to less time McDonnell Douglas Apprxm. 60% in savings on bid
spent on support and service, thus making more room for reactor and missile projects
for new projects. Bringing in the suppliers will reveal
important aspects of the needed components, and the Deere and Company Apprxm. 30% reduction in
development cost for
use of visualization tools minimizes the time spent on
construction equipment
reaching a common understanding of the product
features. Boeing Ballistic Reduction in labor rates by $28
Systems Division per hour; reduction in cost by
The US Air Force conducted a study in 1987 showing 30% to 40%
that CE led to an average of 40% reduction in overall NCR 44% reduction in manufacturing
development time (figure 1). An interesting aspect of costs with respect to NCR's
the survey, is the extended time spent on planning - 2760 electronic cash register
about 10 times more than in a sequential one[8]. This is Cisco Systems Revenue increased from $27
a fairly logical outcome for a process which aim is to million in 1989 to $70 million in
make the later stages run as smooth and swift as 1990
possible. More time spent in the initial phases ensures
less confusion and remodeling later. Table 1: Savings in Cost Due to Concurrent Engineering in
Various U.S. Companies (from Dhillon, 2002).

Despite huge reductions in developing time, the

method has been criticized for not being very useful
for radical innovation purposes. Some claim that even
though bringing together engineers of different
disciplines, the method rarely include non-
technicians[9]. This is reflected in the mentioned
examples which mostly consist of incremental internal
improvements to manufacturing facilities and labor
hours. Whether the process is truly cross-functional
might therefore be questionable. It is however
Figure 1: Time difference between sequential engineering (SE)
important to point out that this issue is somewhat
and concurrent engineering (CE) (from Skalak, 2002).
disputed – some literature does in fact describe the
CE-team as highly multidisciplined (like the mentioned
Hewlett Packard, Northrop, AT&T and IBM have all
customer involvement in Skalak’s list), with personnel
reported very positive results from using CE as a way
from several different departments - including
to reduce cost of manufacturing and repair (table 1).
marketing and design[10]. This inconsistent use of
terms might be due to the relatively young age of
collaborative NPD research.

The Collaborative New Product Development Process 3

2.2 Integrated Product Development (IPD)
An other concept of collaborative new product
development is Integrated Product Development
(IPD). The method was introduced in the mid 80s as a
reaction to the mainly engineering-based CE-
methodology. In addition to engineers from different
disciplines, people from other branches like marketing
and design were also included in the process[11].
The Product Development and Management
Association (PDMA) defines IPD as the following[12]:
A philosophy that systematically employs an integrated team
effort from multiple functional disciplines to develop
effectively and efficiently new products that satisfy customer
needs.
As CE, the IPD process is identified as being parallel
and activity based, as opposed to sequential and
functional based, meaning that the people involved are
more or less the same while the tasks at hand differ
throughout the process. A rather well-known
illustration is used at several technical universities for
describing the parallel work of marketing, design,
production and administration in an IPD process
(Figure 2) [13]:
Figure 2: The IPD process (Fredy Olsson (1985) in Ottoson,
2005)
2.2.1 User focus
In relation with the increased cross-functional focus,
the introduction of real users in the development
process has also become more common. These efforts
are characterized as “Human-centered design” which
involves user involvement and testing at an early stage.
Even though this today well-developed field might not
be directly linked to the origin of the collaborative
efforts, the user focus in these methods probably have
helped increase awareness of usability issues in several
The Collaborative New Product Development Process
different industries. Today, most big companies making
software and electronic devices, like IBM, Sun, HP and
Sony, have usability labs where they bring in users at an
early stage[14].
2.2.2 The Need for a Design Platform
As seen in figure 2, the work of the involved groups in
the IPD process is based on the rather vague term
“need”. The uncertainty of whose need this is, and who
it is who identifies this need, is subject for criticism.
Bjørn Baggerud et. Al. argue in the article “Design
Strategy – A Starting Point for Integrated Product
Development”[15] that the basis of each new product
development should be a lot clearer formulated for
everyone involved, consequently reducing the time
consuming exploration of all aspects of the market,
manufacturability and usability every time the company
develops a new addition to their product portfolio. A
thorough design platform at the basis of each new
NPD process, developed by designers, researchers,
manufacturer engineers and users together, might thus
reduce the time to market even further (Figure 3). This
universal basis can then be reused several times, only
going through minor iterations based on experiences
from the different development processes.
Figure 3: A better defined basis will reduce time-to-market
further according to Baggerud et Al. (from Baggerud, 2006).
How much a company can rely on such a foundation is
connected with the degree of radicality in the
innovation. Makers of a newspaper for instance, will
only have to change the contents from day to day,
while a company with a disruptive new technology
probably have to assess numeral additional aspects
before starting the actual development. What a
company includes in such a basis, is thus related to the
4
particular industry, the company strategy and the
chosen production process.
2.2.3 The Stage-Gate© Model
Some IPD-processes include an external steering group
which comes in between each stage and reviews the
progress. This is to ensure that the development team
stays on track and reaches the planned goals on time.
Dependent on the assessment, the project might be
taken to the next step, or have to go through further
development at the current stage. One of the most
known methods within this philosophy is the Stage-
Gate© method which the creators claim is used in 73%
of North American companies in 2006[16]. The
method is also implemented in the telecom company
Telenor in Norway[17].
Figure 4: The Stage Gate Model (from Cooper, 1995)
Some criticism of the method has surfaced, claiming
that the steering group assessment halts the project for
an unnecessarily long time, making the process abrupt
and discontinuous [18]. A closer integration of
management in the process might be a solution for
avoiding such situations.
2.3 Dynamic Product Development (DPD)
One of the very last contributions to new product
development methods is Dynamic Product
Development.
The term was coined in 1997 when a project was
conducted at Halmstad University in Sweden with the
aim of developing the IPD process further [19].. As
the methods of CE and IPD, the DPD-principles
include strong customer focus and the use of
visualization tools. One difference though, is the use of
an internal concept group working as the steering
group in order to avoid delays resulting from external
interference. Furthermore, the method is highly
iterative (hence the term 'dynamic') and allows for
fundamental concept changes at later stages in the
development process. Concept changes after the
planning phase are not normally considered a part of
The Collaborative New Product Development Process
CE and IPD, and creators of DPD, like the Swedish
researcher Stig Ottoson, consider them therefore as
being too rigid for innovation purposes. This rigidity
can lead to a result which isn't meeting current market
demands since these might have changed after the first
stages are finished. DPD, they claim, is thus a better
way for ensuring market success[20].
A natural concern is of course to what extent such late
iterations will slow down time-to-market, and thus
reducing the competitive advantage. The possibility of
changing the terms of the production basis long after
the planning phase is over, stands also in stark
opposition to the thorough initial stage of concurrent
engineering as well as Baggerud’s arguments of having
a consistent design platform forming the basis of any
development project. The conflicting views introduce
important questions regarding the interface between
the development phase and the production phase.
When should the collaborative efforts of the
development team be succeeded by streamlined
production execution? A possible answer to this
requires considerations which exceed the scope of this
paper. Still, having some sort of well-founded platform
regarding the innovation strategy can hardly be
considered as too rigid for any company – even if it
should contain the possibility of fundamental concept
changes close up to market launch.
4. A COMPARISON OF THE METHODS
Based on the descriptions of the different collaborative
methods, a summarized comparison of the principles is
in place (Table 2):
We see that for the most parts, the methods are quite
similar, with cross-functional teams, customer focus
and use of visualization tools. The issue of steering
groups was introduced mainly with the Stage-Gate©
Model and is thus not much mentioned as a tool for
the CE process. The biggest difference between CE
and the two other is probably the technological focus
and the lack of extensive use of customer
representatives in the process. DPD differs from the
two others by allowing change after the planning stage
is over. As mentioned before, there is some difference
in literature describing the characteristics of the
different methods. The table should therefore not be
seen as a final and complete description of the
5
methods, but more as a guide to some of the identified employees support the process, which also is reported
issues. as decisive for project success [22].
Other success factors include specific project goals and
CE IPD DPD a common understanding of the principles of a
Members R&D R&D, R&D,
collaborative method within the team. Some research
personnel of marketing, marketing, has revealed cases where marketing has consulted
different design, design, R&D only after the product specification had been
backgrounds customer customer finalized “in order to avoid any arguments from R&D
about how to do it”[23]– possibly causing serious
Customer Yes, some Yes, active Yes, active
focus participation participation participation process delay and flaws in the final outcome.
(debated) Comprehensive and continuous training in
collaborative methods is regarded as necessary means
Process Activity Activity Activity for preventing such situations.
based based based
Tasks Internal NPD NPD In addition to the social and cultural factors, mentions
improvement of access to communication tools occur frequently as
Steering - Yes, external Yes, internal important ingredients for an effective project
group execution. This seems especially needed if the team
consists of members located in different parts of the
Visualization CAD CAD CAD,
Tools drawing world, which nowadays is not uncommon. In order to
secure free flowing collaboration between the
Iterations Yes, but not Yes, but not Yes, all the members, proper communication systems need to be
after after way until implemented. All participants should be well
planning planning product
stage stage launch
acquainted with the tools, either from previous use or
training in connection with the project at hand[24].
An issue to be noted though, is the need for always
Table 2: A comparison of the methods meeting face to face in the initial stages of any
collaborative process. Modern communication tools,
This paper will not discuss in detail which of the however advanced, cannot alone ensure the necessary
methods is “the best” in an innovation context, as this trust between group members for conducting a
is highly related to the particular company in question. successful project[25].
However, aspects like organization culture, technology
resources, financial objectives, innovation radicality and 4. CASE STUDIES
composition of disciplines within the company should
most probably be taken into consideration when Variations of collaborative product development
developing a collaborative innovation strategy. processes are currently used in several different
industries. Few companies describe their innovation
process explicatively as CE, IPD or DPD, but the core
3.1 Success Factors principles of the collaborative methods seem to be
widely employed in today’s innovation efforts. Here are
Whichever the strategy a company chooses to go with, a few examples of how big companies have made
there seems to be certain common success factors for collaboration a key issue in their modern innovation
the collaborative NPD process. For instance, literature processes.
on the various methods repeatedly mentions
management support and trust as an important factor 4.1 Procter & Gamble
for ensuring successful implementation[21]. Otherwise,
the team might be needlessly delayed when waiting for In 2000 when Procter & Gamble, the world’s largest
management decisions before being able to commence. consumer packaged goods company, hadn’t managed
A suggested solution is to include a management to introduce a single new product line in 17 years as
representative in the team. Management well as facing a serious stock collapse, radical measures
encouragement seems also to be important for making were needed [26]. The new CEO A.G. Lafley’s solution

The Collaborative New Product Development Process 6

was the Connect & Develop method which included
goals like acquiring 50% of all innovations from
outside the company, and ensuring broader focus on
design-thinking as a way to innovate. The result is
several measures very much resembling a collaborative
design process. After 2000, designers are placed in
every business unit, and a series of 10 week cross-
functional workshops have been implemented for the
purpose of creating new brands [27]. One of the results
of the company’s cross-pollinating efforts is their Crest
Whitestrips from their oral care unit. Traditionally only
including dental experts, this process also gathered
people with knowledge of safe bleaching from the
company’s laundry division. Today, the product grosses
over $200 million per year[28]. Other examples of
similar collaborative efforts include the new Mr. Clean
Autodry[29] and the Allessi-inspired Swiffer version
[30].
Because the company is distributed all over the world,
the organization has implemented a communication
system called “AskMe”where anyone can post their
problems and receive answers from anyone anywhere
in the organization. The application is necessary for
integrating all different levels within the organization,
both organizationally and geographically[31].
Also, as a way to introduce cross-functionality on a
higher level, the company launched a Board of
Designers in 2003, consisting of design chiefs from
other design driven companies. The board meets every
four months to assess new product line concepts and
to provide advice for new design strategic measures
[32].
The measures implemented since 2000 seems to have
worked. In 2004, the company reported a 17 percent
rise in volume and a 19 percent rise in sales[33]- which
is quite impressive for a company of a 22 billion dollar
size. The company relates its recent success entirely to
the new innovation efforts [34].
4.2 BMW and Toyota
The car industry has traditionally been especially
vulnerable to the difference between rational engineer
thinking and creative designer traits, but as the head
designer of BMW Chris Bangle states in an interview
with BusinessWeek Magazine[35]:
The Collaborative New Product Development Process
“…engineers do a better job when they work with designers,
and designers do a better job when they work with engineers.”
At BMW, every new development process starts with
200-300 staffers from different departments teaming
up at the company’s Research and Innovation center in
Münich, Germany for up to three years[36]. The center
is designed with teamwork in mind, enabling easy
interaction and communication between R&D and
marketing, and between line workers and management.
According to brand chief designer Adrian van
Hooydonk, these close cross-functional collaborations
is decisive for speeding up the development process
and making better cars[37].
On the other side of the world, Toyota calls its version
of collaborative product development process Oobeya,
which basically means «big open office». Every month
2 years before the car goes into production, everyone
involved in the process, designers, engineers, marketers
and managers, meets to discuss their concerns and
solutions. This has lead to increased communication
and holistic understanding, reportedly saving the
company billions in more logical distribution and
production systems[38]. In relation to this, it is
important to note that the Asian innovation process
has been characterized by collaborative efforts long
before the introduction of concurrent engineering in
Western companies – a fact that has been attributed to
the traditional Japanese respect for groups and
community[39].
4.3 IBM
At IBM, the company with the highest number of US
patents in the world[40], integrated product
development has been implemented fully since 1998
[41]. The success of the implementation is attributed to
executive support, broad communication, customer
focus, cross-functionality, and benchmarking key
targets against the industry. The company seems to see
collaborative efforts as an important ingredient in its
future innovation processes. Senior Vice President
Ginni Rometty stated at a press-conference in March
2006 [42]:
“At its core, the nature of innovation is changing.
It's global, multi-disciplinary, and collaborative.”
7
How the company tends to deal with these excepted
changes remains to be seen, but for now the
implementation of new initiatives like “jam-sessions”
gathering thousands of IBM employees worldwide for
common brainstorming online, may signal increased
focus on collaborative efforts. This notion is
strengthened by the fact that the company has set aside
$100 million dollars for development of ideas
originating from these online collaborations [43].
4.4 Apple
Interestingly, Apple, identified as the most innovative
company in the world by BusinessWeek Magazine [44],
does not seem to have any formal implementation of a
collaborative cross-disciplined system. In fact, most of
their market success is in most cases attributed to one
individual; CEO Steve Jobs [45]. This quite un-
collaborative trait is however not quite representative
for the company's actual innovation efforts. For
instance, the core design team is in fact said to be
working closely with engineers, marketers and outside
suppliers throughout the development process [46].
The reason why the company hasn’t implemented any
formal efforts is probably due to the relatively small
size of its development team which unlike most other
large corporations’ development staff works in the very
same room. In that way, Apple ensures close
collaboration without strenuous efforts.
The example from Apple might also be the reason why
it is harder to find case studies of collaborative efforts
from smaller companies. As a result of the geographical
and organizational distance in larger companies,
keeping natural collaboration intact might be a
challenge, thus making efforts to conquer these issues a
lot more visible. Further research about when a
company should start considering such a program
would probably be of great use in this context.
An other notable issue regarding the case examples, is
the high representation rate of American companies.
Studies about collaborative innovation efforts in other
parts of the world is also hard to come by. This might
be due to a recent trend in the American innovation
environment, but it is important to note, that as with
the Toyota and BMW examples, the collaborative way
of working is not exclusive to the US. However; when
choosing to implement a collaborative innovation
process in a non-American company based on the
The Collaborative New Product Development Process
success stories from P&G and IBM, different cultural
aspects should be taken into consideration.
5. SKEPTICISM TOWARDS COLLABORATIVE
EFFORTS
There exist also skeptic sentiments towards the
collaborative NPD process. The human factor designer
Donald Norman argues in his book Emotional Design
that the design method of collaboration and iteration
might lead to successful products, but not “great” ones
[47]:
“I still maintain that an
iterative, human-centered approach works well for
behavioral design, but it is not necessarily
appropriate for either the visceral or the reflective ide.
When it comes to these levels, the iterative method is
design by compromise, by committee, and by
consensus. This guarantees a result that is safe and
effective, but invariably dull.
(...) If you want a successful
product, test and revise. If you want a great product,
one that can change the world, let it be driven by
someone with a clear vision. The latter presents more
financial risk, but is the only path to greatness.”
The concern of collaboration sometimes leading to
mediocre products as a result of consensus has also
been expressed by Western businesses when
collaborating with Japanese industry. “Consensus-
management” is a term often used when describing the
Japanese new product development style [48]. The
country’s success as innovator seems however to prove
some of these concerns wrong. The chief designer of
Rover, Richard Woolley, who has worked several years
in the Japanese car industry, describes the cultural
differences as follows [49]:
“The Japanese work superbly well as a team. You
can’t beat them. They are all going in the same
direction and you get the impression that Honda,
Nissan, Toyota are like unstoppable machines…
whereas we all tend to pull in different directions
and tend to think of different ways of doing
things, which is a great strength but also a great
weakness.”
Even though the Japanese seem to manage the
collaborative culture quite well, it is important to stress
8
the significance of trust within a team so that
disagreements are dealt with through constructive
dialogue as opposed to mediocre consensus. As
Norman states, a collaborative process works fine for
securing good products, but might also lead to results
which are “invariably dull”. In other words, being able
to disagree might be one of the most important factors
for ensuring a successful result on the basis of the
collaborative NPD process.
6. THE IMPACT OF THE COLLABORATIVE NPD
PROCESS
How has the collaborative innovation process
influenced the way companies innovate today?
Since the early experiments with Concurrent
Engineering, some fundamental views of the business
world have changed. From the intense focus on
tangible goals of cost- and time reduction, we see an
increasing concern for the intangible values like the one
of the complete user experience – that is how a person
thinks a product defines her and makes her feel when
using it. These are factors which more and more are
regarded as decisive for buying decisions.
The new views of business thinkers such as
management-guru Tom Peters strengthen the notion of
a change in corporate values. In his book Re-Imagine
[50], Peters argues strongly that businesses need to
stop worrying about measurable goals like cost and
time, and instead start focusing on experience and
added value. Furthermore, Peters vividly advocates the
new “Cross-Functional World” which he describes as
seamless, cooperative, communicative and
multidisciplinary as opposed to the divided,
competitive, rigid and specialized world of yesterday.
Even though originally having the sole aim of reducing
time-to-market, one might wonder if not the
collaborative methods through their cross-functionality
have contributed to the new sentiments. After all, it
was not until the concurrent engineering efforts in the
80s that close collaboration between different
disciplines started to occur as a formal tool in
American NPD processes, thus paving the way for
non-business-related world views and opinions. As
today's businesses seem to focus more and more on
intangible goals, as opposed to the old aims of reduced
time and cost, the cross-functional aspect of the
collaborative methods appears to be given new
The Collaborative New Product Development Process
significance as a tool for ensuring the advocated
complete user experience.
One of the perhaps greatest examples of a product in
full accordance with the new goals of NPD, is the iPod
from Apple. When launching the mp3-player in 2001,
business analysts focused on the measurable features
like storage room and battery life. Some didn't think
the player would be a success due to the relatively high
price. Cnet News reported the following at the launch
in 2001[51]:
Stephen Baker, an analyst at NPD Intelect, said
that the iPod will likely stand out for its large storage
capacity but predicted that the device may have
trouble digging out a niche in the market.
We all know how wrong this statement turned out to
be. Despite being late, expensive and not very radical in
a technological sense, the disruptive new user
experience resulting from a clever mix of design,
marketing and technology, was the attribute which
created the success. Accordingly, one can say that the
iPod-story shows the importance of multidisciplinary
collaborations in the modern innovation process.
6.1 New Disciplines of Innovation
Two disciplines which are experiencing growing respect
in the business community because of their knowledge
of user experience are the designers and the
anthropologists. According to design thinkers, a better
use of design knowledge will by focusing on users,
creativity and experience in a broader sense, bring a
company's innovation efforts to a higher level [52].
Corporate measures like the board of designers at
P&G, seem to show that their arguments have started
to be taken seriously.
As for anthropologists, their know-how of observing
users in their natural habitat, and so figuring out their
real needs, is more and more regarded as a valuable
tool for making more complete products and
increasing brand loyalty[53].
One of the leading thought leaders on innovation
today, the design consultancy IDEO, uses both
designers and anthropologists actively in their
development processes as their knowledge is regarded
as decisive for making products with a complete user
experience. The company has earned more design
9
awards than any other of its kind, and its portfolio
contains revolutionary products like the first mouse for
Apple and the first laptop computer in the world. Their
work studio is characterized by a cross-functional mix
of several different disciplines, and set up a lot like
Thomas Edison's factory once was- keeping
communication flowing free among the staff [54].
The company stresses the importance of people with
other interests than their specialized field (called «T-
shaped-people»). This secures an environment with
empathy for other professions, experiences and view
points, and thus a better environment for new ideas.
On these accounts, one can probably describe IDEO
as a company with an implicit cross-functional identity.
Their philosophies have spread widely because of their
many projects with American corporations, and the
company is today regarded as one of the most
innovative consultancies in the world – possibly being
one of the strongest catalysts for the new collaborative
attitude.
6.2 Challenges
Even though we see a growing focus on cross-
functionality, it is important to note that the vast
majority of companies don’t seem to have implemented
such efforts in their innovation process. The reason is
probably the perceived culture differences between
disciplines - leading to collaboration-difficulties
between the groups. In her article “Innovation –
What's design got to do with it?”[55], Bettina von
Stamm describes the differences between designers and
managers:
“Where managers tend to focus on profits and
returns, designers focus on product and service
quality; while managers are in for survival, designers
prefer reform; where managers think linearly,
designers think laterally; managers are serialists,
problemoriented, and cautious, designers are holistic,
solutions-led, and experimental. In short, while
managers are adaptive, designers are innovative.”
These radical differences represents a true challenge
when trying to bridge the gap between the professions.
However, examples like the cross-functionality in the
case studies, the statements from Peters and the
experiences of IDEO, may signal the beginning of a
broader use of non-business professions in the
common innovation process. Many design schools and
The Collaborative New Product Development Process
a few business schools, have also introduced some
interdisciplinary classes in the curriculum, thus hoping
to gain better communication and understanding
between the disciplines in the future [56, 57].
6.3 The Chicken or the Egg?
When exploring the link between the rise of the
collaborative method and the increased focus on the
intangible knowledges of disciplines like anthropology
and design, a natural question is of course which came
first; the enhanced focus on intangibles values, and
then the introduction of new disciplines, or the
introduction of new disciplines as a result of the
collaborative process thus paving the way for increased
focus on intangible values. Most likely, it is a
combination of both, where the two factors strengthen
and gain support from each other. Nevertheless;
without the early collaborative movement of the 80s,
the non-business disciplines would most probably have
a lot harder time breaking into the innovation
processes today. At the same time; without a complete
multidisciplinary and collaborative team, today's aim
for the complete user experience is probably almost
impossible to reach.
7. CONCLUSION
Although there are evidently disputed differences
between the new collaborative NPD processes, the
trend of cross-functionality seems to be an established
feature in many of today's innovation efforts. The
initial aim of reducing time-to-market is still intact, but
has also been supplemented by goals like making better
products in accordance with real user needs. Examples
like the one of iPod, strengthens the notion of the
importance of the complete user experience, making a
product's success not only related to the tangible
factors of time- and cost. This is why the collaborative
efforts, by its opening up to other disciplines, can be a
powerful tool when aiming for successful products in
today's market place.
As seen from this paper, there are certain aspects
regarding the collaborative methods which might
benefit from further research:
• What criteria should decide a company's
collaborative innovation strategy?
10
 • What cultural aspects might influence a
collaborative innovation process?
• When should the collaborative efforts of the
development team be succeeded by
streamlined production execution?
• When and at what size should a company
implement tools to ease the collaboration
efforts?
• How should the world of business and the
world of other disciplines go about to create
better understanding and collaboration with
each other?
In addition to these issues, there is a need for
establishing distinct criteria for the different
collaborative methods of CE, IPD and DPD, so that a
company more easily can decide on which suits their
needs the best. The current confusion surrounding
these criteria is probably a reflection of a field in
constant growth and development.

REFERENCES

[1] N. P. Mouzelis, Organisation and Bureaucracy. An analysis of Modern Theories, Chicago, Illinois: Aldine Publ. Company,
1973.

[2] A. Hargadon and R. I. Sutton, “Building an Innovation Factory,” in Harvard Business Review on Innovation. Boston,
MA: Harvard Business School Press, 2001, pp. 72-73.

[3] C. Comerer and B. Uttal in L. Trygg, “Concurrent Engineering Practices in Selected Swedish
Companies: A Movement or an Activity of the Few?” Journal of Product Innovation Management, no. 10, pp. 403-415,
1993.

[4] A. Shenhar et. Al, A New Framework for Strategic Project Management, Stevens Institute of Technology, November
26, 2000.

[5] Insitute of Defense Analysis, Report R-338 in S. Skalak, Implementing Concurrent Engineering in Small Companies. New
York, NY: Marcel Dekker Inc, 2002, p. 4.

[6] B.S. Dhillon: Engineering and Technology Management Tools and Applications. Norwood, MA: Artech House, 2002.

[7] S. Skalak, Implementing Concurrent Engineering in Small Companies. New York, NY: Marcel Dekker Inc, 2002, p.5.

[8] US Air Force R&M 2000 Process Study Report in S. Skalak, Implementing Concurrent Engineering in Small Companies.
New York, NY: Marcel Dekker Inc, 2002.

[9] S. Ottoson: “Dynamic product development – DPD”, Technovation 24, pp. 207-217, 2004.

[10] N. Bhuiyan et. Al: «Implementing Concurrent Engineering,» Research Technology Management, vol. 49, no. 1; pp 38-
43, Jan/Feb 2006.

[11] S. Ottoson: Handbook in innovation management – Dynamic Business and Product Development, Tervix AB, 2006.

[12] “The PDMA Glossary for New Product Development” [Online document] 2006 [cited Oct. 16 2006] Available
Online: <http://www.pdma.org/library/glossary.html?PHPSESSID=ac3f4c91ea8f17c6e3f4c971d66e8cd2>

The Collaborative New Product Development Process 11

[13] S. Ottoson: Handbook in innovation management – Dynamic Business and Product Development, Tervix AB, 2006.

[14] H. W. Bjelland, Design for og med brukere, Institutt for Produktdesign, NTNU, September 2006.

[15] B. Baggerud, R. Nesbakken and A.Liem ”Design Strategy – A Starting Point for Integrated Product
Development”, presented at NordDesign, Reykjavik, Iceland, August 16-18, 2006.

[16] The Stage-Gate© Process, The Product Development Institute Inc. [Online document], date not disclosed[cited Oct. 7,
2006] Available Online: <http://www.prod-dev.com/pdf/20_years.pdf>

[17] B. A. Davidsen:”On the path to a new product process”, Telektronikk 2, 2004.

[18] S. Ottoson: “Dynamic product development – DPD”, Technovation 24, pp. 207-217, 2004.

[19] Ibid.

[20] Ibid.

[21] N. Bhuiyan et Al: “Implementing Concurrent Engineering”, Research Technology Management, vol. 49, no.1, pp. 38-
43, 2006.

[22] W. E. Souder: “Managing Relations Between R&D and Marketing in New Product Development Projects”,
Journal of Product Innovation Management, Vol. 5, No. 1, pp. 6-19, 1988.

[23] Ibid.

[24] N. Bhuiyan et Al: “Implementing Concurrent Engineering”, Research Technology Management, vol. 49, no.1, pp. 38-
43, 2006.

[25] T. Kelley, The Ten Faces of Innovation, Doubleday, 2005.

[26] R. Stringer: “How to Manage Radical Innovation”, California Management Review, Vol. 42, No. 4, p.70-88, 2000.

[27] J. Reingold: “The Interpreter”, Fast Company, Issue 95, p.61, 2005.

[28] T. Kelley, The ten faces of innovation, Doubleday 2005.

[29] Ibid.

[30] M. Conlin, “Champions of Innovation”, Inside Innovation, BusinessWeek, June 2006.

[31] R. D. Hof, “At P&G, It's "360-Degree Innovation"”, BusinessWeek Online [Online Document], Oct. 11, 2004
[Cited Oct. 15, 2006], Available online: <http://www.businessweek.com/magazine/content/04_41/b3903463.htm>

[32] J. Reingold: “The Interpreter”, Fast Company, Issue 95, p.61, 2005.

[33] Anonymus, “Procter&Gamble’s innovation success”, Strategic Direction, Vol. 21, Issue 7, pp. 11-13, 2005.

[34] L. Huston and N. Sakkab, ”Connect and Develop. Inside Procter&Gamble’s New Model for Innovation”,
Harvard Business Review, March 2006.

The Collaborative New Product Development Process 12

[35] B. Breen, “BMW: Driven by Design”, Fast Company, Issue 62, p.123, August 2002.

[36] J. McGregor et. Al, “The World’s most Innovative Companies”, BusinessWeek Online [Online Document], April
24, 2006 [cited Oct. 16, 2006], Available online:
<http://www.businessweek.com/magazine/content/06_17/b3981401.htm?chan=search>.

[37] G. Edmondson, «An Interview with BMW's Chief Designer», [Online document], Newsweek, October 16, 2006
[cited Oct. 17, 2006]. Available online: <http://www.businessweek.com/magazine/content/06_42/b4005076.htm>.

[38] F. Warner, “In a word, Toyota drives for innovation”, Fast Company, Issue 61, Aug 2002.

[39] N. Ohtani and S. Duke, Japanese Design and Development. Hampshire, England: The Design Council, Gower, 1997.

[40] “IBM leads the pack in patents”, IBM homepage [Online document], [cited Oct. 15, 2006], Available online:
<www.ibm.com/ibm/licensing>.

[41] J. Dickerson, “Improve Product Development Using IPD”, Quality Progress; vol. 39, no. 8, p. 96, 2006.

[42] S. Hamm, ”Thinking the Future, with IBM”, BusinessWeek, March 9, 2006.

[43] Ibid

[44] J. McGregor et. Al, “The World’s most Innovative Companies”, BusinessWeek Online [Online Document], April
24, 2006 [cited Oct. 16, 2006], Available online:
<http://www.businessweek.com/magazine/content/06_17/b3981401.htm?chan=search>.

[45] P.Burrows, Who Is Jonathan Ive?, BusinessWeek Online [Online document],

Sept. 25, 2006 [cited Oct. 15, 2006], Available online:
<http://www.businessweek.com/magazine/content/06_39/b4002414.htm?>.

[46] Ibid.

[47] D. Norman, Emotional Design, New York, NY: Basic Books, December 2003, pp 96-98.

[48] N. Ohtani and S. Duke, Japanese Design and Development. Hampshire, England: The Design Council, Gower, 1997.

[49] Ibid, p. 23.

[50] T. Peters, Re-Imagine, London, UK: Dorling Kindersly Limited, 2003.

[51] I. Fried, “Apple’s iPod spurs mixed reactions”, Cnet News [Online document], Oct. 23, 2001 [cited Oct. 19,
2006], Available online: <http://news.com.com/Apples+iPod+spurs+mixed+reactions/2100-1040_3-
274821.html>

[52] B. Borja de Mozota, Design Managament, New York, NY: Allworth Press, 2003.

[53] T. Kelley, The Ten Faces of Innovation, New York, NY: Doubleday, 2005.

[54] A. Hargadon and R. I. Sutton, “Building an Innovation Factory,” in Harvard Business Review on Innovation. Boston,
MA: Harvard Business School Press, 2001. pp. 72-73.

The Collaborative New Product Development Process 13

[55] B. von Stamm, ”Innovation – What’s Design Got to Do with It?”, Design Management Review, Vol. 15, Iss. 1, p.10-
19, 2004, p. 13.

[56] N. Bhan: “While You Were Out: Changes in the Global Design Industry”, Core77 [Online document], 2004
[cited Oct. 19, 2006], <http://www.core77.com/reactor/12.04_niti_bhan.asp>

[57] J. Merritt and L. Lavelle: “Tomorrow's B-School? It Might Be A D-School”, Businessweek Online [Online
document], Aug. 1, 2005 [cited Oct. 16, 2006], Available online:
<http://www.businessweek.com/magazine/content/05_31/b3945418.htm>

FIGURES

1: From S. Skalak 2002, Implementing Concurrent Engineering in Small Companies. New York, NY: Marcel Dekker Inc,
2002, p.6.

2: From F. Olsson (1985) in S. Ottoson, Handbook in innovation management – Dynamic Business and Product Development,
Tervix AB, 2006, p.166.

3: From B. Baggerud, R. Nesbakken, A.Liem: ”Design Strategy – A Starting Point for Integrated Product
Development”, presented at NordDesign, Reykjavik, Iceland, August 16-18, 2006, p. 3.

4: From R. G. Cooper: “How to launch a new product successfully” CMA Management Magazine, vol. 69, no.8, pp.
20-23, Oct 1995, p. 20.

The Collaborative New Product Development Process 14

The Collaborative New Product Development Process 15