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Transcript of OPERATIOTIONAL AND STRATEGIC MANAGEMENT KTT Antti Ainamo Academy of Finland and Helsinki School of...
OPERATIOTIONAL AND STRATEGIC MANAGEMENT
KTT Antti Ainamo
Academy of Finland
and
Helsinki School of Economics and Business Administration
Department of Management
S-72.124 Product Development of
Telecommunication systems
HUT PD 270300 / Antti Ainamo
2
Material on which talk is based Product design and development
Sakakakibara, K., Lindholm, C. & Ainamo, A. (1995): Product Development in Emerging Product Markets: The Case of Personal Digital Assistants (PDAs)”, Business Strategy Review.
Ainamo, A. (1999): ”Strategic Product Planning”. Hallinnon tutkimus. Ainamo, A. & Pantzar, M. (forthcoming): ”Design for the Information Society: Learning
from the Nokia Experience”. Design Journal.
New organizational forms and strategy Djelic, ML & Ainamo, A. (1999): ”The Coevolution of New Organization Forms in the
Fashion Industry: A Historical and and Comparative Study of France, Italy and the USA”. Organization Science, Special Issue on Strategic and New Organizational Forms, September-October
Ainamo, & Djelic (forthcoming): ”Image-and-Communication Portfolios”, Strategic Management Society, submitted.
Pantzar, M. & Ainamo, A. (forthcoming): ”Dynamic conservatism: a comparison of Ford, GM, Motorola and Nokia”, EGOS
Case studies: electronics, computing, mobile telecommunications
HUT PD 270300 / Antti Ainamo
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Outline
Management: operational and strategic A stages model of product development A matrix of products and systems Product development disciplines How to manage product development
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
4
The Need for Management
Different kinds of disciplines Engineering Marketing Industrial design and graphic design The humanities
Resistance to change Turbulence in the competitive landscape The customer values ”quality” (the whole)
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
5
Management
Different ways to integrate and coordinate Operational management Strategic management
Coping with change resistance win-lose win-win
Attitudes to turbulence Adapt Strategic choice Shaping of the environment
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
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Operational management
Implementation Staying within given boundaries or constraints Incrementalism
Personal Digital Assistants, early 1990s, Japanese Fujitsu
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
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Strategic management
The management of the general” Creating and changing boundaries Radical (re)positioning of the business
Personal Digital Assistants, Apple Newton
HUT PD 270300 / Antti Ainamo
8
PD Stages and Roles
A stages model Design Technical product engineering Production planning Marketing planning
Different kinds of products Simple Complex Modular Interface
(Ainamo 1999a, 1999b)
A stages model of product development
(Ainamo 1999, s. 147)
Design Product Production Marketing engineering planning planning
Concept Product and/or Production Commercializationsystem capacity
(see also 1999b, 327)
HUT PD 270300 / Antti Ainamo
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Design
Conceptualizing new products The current state Ideal states Conceptualization: bridging the gap
Refining concepts Drawings Mock-ups Prototypes
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
11
Technical product product engineering
Product architecture Product platform Product generations and product families
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
12
Product architecture
Architecture Concept Component Links
To concept: function To user: interface
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
13
Product platform
The central component or module in the architecture
Link between design, production and marketing Faster Cheaper ’Better’
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
14
Product generations and product families
Product generation Products following a historic technical
choice or theme Technical implications ”Historic” – analysis of products across
time Product family
Variations on the theme Marketing implications Synthesis of current products
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
15
Production planning and marketing
Production capability and productization Commercialization and logistics
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
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Four kinds of products or systems
Complex Simple Interface Modular
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
17
A product that is a complex system...
is challenging to develop is challenging for the user Necessitates to calm down / educate
’distressedä user Multidisciplinary teams
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
18
What is complexity?
Systems consist of ’subsystems’ (parts, components, modules)
Subsystems have dense internal relationships
Relatively few external relationships Complex systems
Many subsystems Many relationships between subsystems ’Nonsimple’ relationships
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
19
Managing complexity
Break down complex systems into simple (sub)systems
Manage each subsystem separately Manage the system of subsystems as a
whole
HUT PD 270300 / Antti Ainamo
20
A product that is simple...
is technically easy to handle is easy to use for the user can be ”boring” for the user (!) introduces need to make product ”exciting” Marketing
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
21
A product that is subsystem-driven...
is difficult to develop in part has a product form that is stable has all depend on one technical subsystem Product engineering of the critical subsystem
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
22
A product that is an interface product...
Subsystems exist... but their links challenge (potential) usability The goal: increase user-friendliness Design
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
23
Functionality, meaningfulness, and user-friendliness
Functionality Designed concept translated into technical
language Product engineering (and design) critical
Meaningfulness Functionality translated into marketing language Marketing (and design) critical
User friendliness Functionality translated into the language of the
end-user Design (and product engineering and marketing)
critical (Ainamo 1999a, 1999b)
Find role for each type of product
Quality in the eyes of the customer, the product concept, product types and the order of priority ofthe stages of the product development process (Ainamo 1999a, s. 153, 199b, 331).
QUALITY IN THE EYES OFTHE CUSTOMER
Difficult to achieve Easy to achieve
Difficult COMPLEX PRODUCT (for ex. MODULAR PRODUCTairplane, telecom system ) (for ex. a drill)Multidisciplinary Product engineering and
CHANGING production planningPRODUCTCONCEPT Interface product (for ex. Simple product (for ex.
consumer electronics, software) convenience good, classic Beetle)Easy Design Marketing
HUT PD 270300 / Antti Ainamo
25
Mobile phones
1st Generation analog phones Complex systems Productl engineering
2nd Generation digital phones Once systems in place, both 1st and 2nd G were
simple products Marketing
3rd G smart phones, communicators etc. All subsystems exist Design of usability and user-friendliness critical
Ainamo & Pantzar (2000)
HUT PD 270300 / Antti Ainamo
26
1G, 2G, 3G and the three discliplines
1st G From complexity towards simplicity PRODUCT ENGINEERING: product architecture
2nd G From simplicity towards marketing and segmentation MARKETING: product families: new product
forms,features and subsystems 3rd G
From segmentation towards lifestyle design DESIGN AND REAL-TIME MARKETING: Integration
of technologies into new interfaces
Ainamo & Pantzar (2000)
HUT PD 270300 / Antti Ainamo
27
Trends in product development
Need for new product development methodologies
’Hero designers’ rare (Bell, 1999) Product developement is multidisciplinary Strategic organization design Organization design more important than product
development Interaction
”Incorrect” use of products Learning Flexibility and customization
Ainamo & Pantzar (2000)
HUT PD 270300 / Antti Ainamo
28
Product development strategy:Lessons from the fashion industry
Organization forms: lLessons from the fashion industry (input)
Changing ideas and techniques (process)
Brands (output)
(Ainamo 1999a, 1999b) Ks. myös Ainamo, A. (1999c): Fashion as Strategy: Ideas and Techniques about organizing in the Fashion Industry as a Model for Stategy. Invited Paper and Presentation at INCAE, San Jose, Costa Rica, Aug. 31. Hosts: N. Phillips and P. Martin de Holan.
HUT PD 270300 / Antti Ainamo
29
Product development fashions
New fashionable ideas and techniques ”Transitory collective beliefs” (Abrahamsson, 1996)
”Useful error” (Huczynski, 1996)
Learning by failure an important part of learning
Reinterpretation of failure Interventions Reframing failure Consistency or shift
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30
Product development personnel: Commitment and building commitment
Commitment of PD personnel Loose link to business results Interpretation of results based on beliefs and
values
(”social construction”) Doing at the forefront (”tacit knowledge”)
Building commitment The ideal and and (current) constraints Learn and develop language and communication Link results and doing
(Ainamo 1999a, 1999b, 2000)
HUT PD 270300 / Antti Ainamo
31
Strategic management of PD
Strategic management is communication The constraints The ideal Linking the two
”People busines” Develop common language Understand subordinates but don’t overdo it Treat tensions Explicit or tacit interventions
Management Funding and support Learning and innovation Link with market development & industry analysis
HUT PD 270300 / Antti Ainamo
32
Knowledge management ja oppiminen
All knowledge is not explicit – it is ”silent” (tacit knowledge; Nonaka 1994)
New knowledge builds on the old, when there is success (March & Simon 1958)
(Ainamo 1999a, 1999b, 2000)
HUT PD 270300 / Antti Ainamo
33
Summary: Management and product development
Operational and strategic management Need to integrate different kinds of
competences Turbulence Resistance to change
(Ainamo 1999a, 1999b)
HUT PD 270300 / Antti Ainamo
34
Turbulence
New products are ”revolutionary” Markets are reactionary
Revolution does not happen Change is slow Change is difficult to predict
Change Partial or temporary Sudden shift into a new standard
Rhetoric and reality ”Revolution” and design are rhetoric Evolution and a random process are reality
(Ainamo 1999a, 1999b, 2000)
HUT PD 270300 / Antti Ainamo
35
Dealing with resistance to change
Question current model New ideal Reset organizational boundaries Feed short-term results into process ’Make’ results if you need to
Motivation Momentum
(Ainamo & Pantzar 2000)
HUT PD 270300 / Antti Ainamo
36Product development and
interorganizational networks Product development does not happen only
within the organization Interorganizational networking – between market
and organizational hierarchy Need for trust, the ”glue” between organizations Trust and networking are contingent phenomena
(”it depends”) Japan: keiretsu Finland: government and technology
(Ainamo 1999a, 1999b, 2000)
HUT PD 270300 / Antti Ainamo
37
Interorganizational networks: the fashion industry
Interorganizational networking is ’global’ only on a high level or abstraction
Trust is the ”glue” The basis of trust differs from one country to
the next France: regulation Italy: socially embedded flexible networks The U.S.A: the virtual organization Interorganizational networking differs from
one country to the next
HUT PD 270300 / Antti Ainamo
38
Intraorganization network: IBM ThinkPad
Early 1990s Parallel projects
USA Italy Japan
Japanese ”bento box” became the global choice
HUT PD 270300 / Antti Ainamo
39
Product engineering: the Sony Walkman
Several technologies A small portable dictaphone Ear phones
HUT PD 270300 / Antti Ainamo
40
”Product development” or ”product planning”?
Definitions differ ’Product planning includesonly
productization and commercialization (ks. esim.
Ainamo, 1999a,b)
’PD includes only design and technical product engineering’
’Also production planning is included’ ’Also marketing is included’