Performance evaluation of resource allocation strategies for new product development under different workload scenarios

Purpose – Resource scarcity is a major difficulty facing firms that engage in new product development (NPD) projects. The purpose of this paper is to understand how resource allocation strategies affect NPD performance and which strategy is the best alternative, a research and development (R&D) process model is constructed using system dynamics. Design/methodology/approach – Moreover, resource allocation strategies are categorized into two types: design‐stage‐first strategy and manufacturing‐stage‐first strategy, and several important indicators of performance evaluation are defined. Then different workload scenarios are developed to test the relationships between resource allocation strategy and various NPD performance measures. Findings – The most important finding from simulation results is that a firm should allocate its resources into early development stage first in order to obtain superior R&D performance. Originality/value – This paper has successfully constructed new system dynamics model for quantifying the performances of R&D process.