Organizing global product development for complex engineered systems

Abstract

Recent advances in engineering collaboration tools and internet technology have enabled firms to distribute their product development (PD) tasks to offshore sites and global outsourcing partners while still maintaining a tightly connected process. In this paper, we explore such global PD structures from process flow and system architecture perspectives, employing the design structure matrix method. Through five case studies, spanning electronics, equipment, and aerospace industries, we observe the interaction complexity inherent in various global work distributions, the product and process structures, and their interplay with the speDA72-B1003-A011cific strategy used by the firm. Our observations lead to implications for organization forms and architecture decompositions for firms pursuing offshoring of engineering activities. Based on these implications, we propose a process for firms to follow as they pursue GPD, while recognizing that: first, modularity in design and development and modularity in manufacturing need not be the same, specially in complex engineered systems (CESs); and second, system architecture development is a core competence of the firm designing and developing CESs, and this activity should be retained at the home location. We conclude with potential research directions on the subject of global PD.