New Product Development Structures and Time-to-Market

In fast-cycle, high technology industries, the speed and rate at which companies can introduce products into the market are critical for sustaining competitive advantage and market share. The authors analyze new product development by three international manufacturers that dominate a segment of the electronic component industry. The objective is to examine the impact of two distinct product development strategies and structures on time-to-market. The analysis of more than 200 new product developments provides important findings. A concentrated new product development structure, in contrast to a distributed structure, affords rapid prototyping. However, volume production is reached faster in the distributed structure. Also, devoting more time to prototyping hastens volume production.