212 Afr. J. Mark. Manage.

bination between the two types of teams (Precup et al., some criticism and according to the extent of information 2006). and communication technology (ICT) need to modify. In Given the complexities involved in organizing face-to-forthcoming section the major aspects of new product face interactions among team members and the development (NPD), NPD process and its relationship advancements in electronic communication technologies, with virtual teams, Stage-Gate system and finally firms are turning toward employing virtual NPD teams presents a modified Stage-Gate system will be described. (Jacobsa et al., 2005; Badrinarayanan and Arnett, 2008; Schmidt et al., 2001). IT improves NPD flexibility NEW PRODUCT DEVELOPMENT (NPD) CALLS FOR

(Durmusoglu and Calantone, 2006). New product deve- VIRTUALITY

lopment requires the collaboration of new product team members both within and outside the firm (Martinez-

Product development definition used by different resear-Sanchez et al., 2006; McDonough et al., 2001; Ozer,

chers in slightly different ways, but generally it is the 2000) and NPD teams are necessary in all businesses

process that covers product design, production system (Leenders et al., 2003). In addition, the pressure of

design and product introduction processes and start of globalize competition forces companies to face increased

production (Johansen, 2005). A multidisciplinary pressures to build critical mass, reach new markets, and

approach is needed to be successful in launching new plug skill gaps. Therefore, NPD efforts are increasingly

products and managing daily operations (Flores, 2006). being pursued across multiple nations through all forms

In the NPD context, teams developing new products in of organizational arrangements (Cummings and Teng,

the turbulent environments encounter quick depreciation 2003). Given the resulting differences in time zones and

of technology and market knowledge due to rapidly physical distances in such efforts, virtual NPD projects

changing customer needs, wants, and desires (Akgun et are receiving increasing attention (McDonough et al.,

al., 2007). Adoption of collaborative engineering tools and 2001). The use of virtual teams for new product

technology (e.g., Web-based development systems for development is rapidly growing and organizations can be

virtual team coordination) was significantly correlated with dependent on it to sustain competitive advantage (Taifi,

NPD profitability (Ettlie and Elsenbach, 2007). ICT 2007).

enhances the NPD process by shortening distances and saving on costs and time (Vilaseca-Requena et al., 2007). New product development process Kafouros et al. (2008) found that internationalization enhances a firm’s capacity to improve performance New business formation activities vary in complexity and through innovation. Since efficiency, effectiveness and formality from day-to-day entrepreneurial or customer innovation management has different and contradictory prospecting activities to highly structured approaches to natures, it is very difficult to achieve an efficient and new product development (Davis and Sun, 2006). innovative network cooperative NPD (Chen et al., 2008b). Today’s uncertain and dynamic environment presents a Supplier involvement in NPD can also help the buying fundamental challenge to the new product development firm to gain new competencies, share risks, move faster process of the future (MacCormack et al., 2001). New into new markets, and conserve resources (Wagner and product development is a multi-dimensional process and Hoegl, 2006). involves multiple activities (Ozer, 2000). Kusar et al. New product development (NPD) has long been (2004) summarized different stage of new product recognised as one of the corporate core functions (Huang development which in earlier stages, the objective is to et al., 2004). During the past 25 years NPD has increamake a preliminary market, business, and technical singly been recognized as a critical factor in ensuring the assessment, whereas at the later stages they propose to continued existence of firms (Biemans, 2003). The rate of actually design and develop the product(s). market growth and technological changes has accelerated in the past years and this turbulent environment - Definition of goals (goals of the product development requires new methods and techniques to bring successful process)

new products to the marketplace (González and Palacios, - Feasibility study (term plan, financial plan, pre-2002). Particularly for companies with short product life calculation, goals of market)

cycles, it is important to quickly and safely develop new - Development (first draft and structure of the product, products and new product platforms that fulfil reasonable first draft of components, product planning and its control demands on quality, performance, and cost (Ottosson, processes)

2004). The world market requires short product develop- Design (design of components, drawing of parts, bills of ment times (Starbek and Grum, 2002), and therefore, in material)

order to successfully and efficiently get all the experience Stage-gate system in NPD: Several authors proposed needed in developing new products and services, more and more organizations are forced to move from tradidifferent conceptual models for the NPD process, tional face-to-face teams to virtual teams or adopt a com- beginning from the idea screening and ending with the

Figure 1. The stage-gate system model (source: Cooper, 2006).

2007). commercial launching. The model of Cooper, called the Stage-Gate System is one of the most widely acknowledged systems (Rejeb et al., 2008). The Stage-Gate DEMAND FOR MODIFIED STAGE-GATE WITH

System model (Figure 1) divides the NPD into discrete VIRTUAL PRODUCT DEVELOPMENT TEAM

stages, typically five stages. Each Stage gathers a set of activities to be done by a multifunctional project team. To

Recently, the Stage-Gate system had been modified and enter into each stage, some conditions and criteria have

adjusted to fitting the real situation in nowadays, called to be fulfilled. These are specified in the Gates. A Gate is

the Next Generation Stage-Gate (Figure 2). The greatest a project review in which all the information is confronted

change in Stage-Gate system is that it has become a by the whole team. Some criticism of the method has

scalable process, scaled to fit very different types and surfaced, claiming that the steering group assessment in

risk-levels of projects, from very risky and complex the stage and gate steps halts the project for an

platform developments through to lower risk extensions unnecessarily long time, making the process abrupt and

and modifications, and even to handle rather simple sales discontinuous (Ottosson, 2004). A closer integration of

force requests.

management through virtual team in the process might

Managers recognized that any kinds of product devebe a solution for avoiding such situations.

lopment project have to manage risks and consumption of resources, but it is not all necessary to go through the Stage-gate process: This process is a method of fulfil five-stage process. The process has revised into managing the new product development process to multiple versions to fit business needs and to accelerate increase the probability of launching new products quickly projects. Stage-Gate XPress for projects of moderate risk, and successfully. The process provides a blueprint to such as improvements, modifications and extensions; move projects through the various stages of develop-and Stage-Gate Lite for very small projects, such as ment: 1.) idea generation, 2.) preliminary investigation, simple customer requests (Cooper, 2008). Although Next 3.) business case preparation, 4.) product development, Generation Stage-Gate has defined for different types 5.) product testing, and 6.) product introduction. This and risk-levels of projects, but still team collaboration in process is used by such companies as IBM, Procter and each stage is unveiled. So dealing with virtual teams can Gamble, 3 M, General Motors, and others. The process is bring an opportunity to make closer integration of team primarily used in the development of specific commercial members in the process. products, and is more likely to be used in platform Virtual product development team by using colla-projects than in derivative projects. borative tools can effectively be used both in the earlier and later stages of the NPD process. Past research has Auto companies that have modified their Stage-Gates mainly focused on the role of Internet in NPD (Ozer, procedures are also significantly more likely to report (1) 2004). Almeida and Miguel (2007) have been identified in use of virtual teams; (2) adoption of collaborative and the literature that it seems to exist a lack of a conceptual virtual new product development software supporting model that represents all dimensions and interactions in tools; (3) having formalized strategies in place specifically the new product development process. On the other to guide the new product development process; and (4) hand, some criticism of Stage-Gate method has surfaced, having adopted structured processes used to guide the new claiming that the steering group assessment in the gate product development process (Ettlie and Elsenbach,

214 Afr. J. Mark. Manage.

Figure 2. An overview of the next generation stag-gate (Source: (Cooper, 2008)).

mation and communication technologies (e-mail, videostep halts the project for an unnecessarily long time, conferencing, telephone, etc.) (Hertel et al., 2005). We making the process abrupt and discontinuous (Ottosson, define, virtual team is small temporary groups of geogra-2004). A closer integration of management through virtual phically, organizationally and/or time dispersed knowteam in the process might be a solution for avoiding such ledge workers who coordinate their work, predominantly situations. Integration is the essence of the concurrent with electronic information and communication product design and development activity in many orgatechnologies in order to accomplish one or more nizations (Pawar and Sharifi, 1997). Ragatz et al. (2002) organization tasks. suggest that integration of the supplier’s technology roadmaps into the development cycle is critical to ensuring that target costs are met. Capturing customer requirements

To compensate for the lack of a conceptual model that represents all aspects and interactions in the new product

Collaborative tools allow firms to respond quickly to process and decrease criticism of Stage-Gate system, a

specific customer requirements with new, high-quality, solution called Modified Stage-Gate system is introduced.

innovative products, and it enables firms to build cross-Figure 3 illustrates new model architecture of the virtual

functional competencies, enhance flexibility and share product development process. The architecture is struc-knowledge (Mulebeke and Zheng, 2006). Capturing tured in a two-layered framework: Traditional Stage-Gate

customer requirements is represented throughout product system and collaborative tool layer which are supported

development will facilitate performing quality function by virtual team. Merge of Stage-gate system with virtual

deployment (Rodriguez and Al-Ashaab, 2005). product development team lead to increased new product performance and decreased time-to-market. The following sections will describe some elements of the Collaborative capabilities collaborative tool layer in more detail. Gassmann and Von Zedtwitz (2003) defined “virtual Enabling collaborative capability through virtual teamwork team as a group of people and sub-teams who interact represents a fundamental transitioning to be more effecthrough interdependent tasks guided by common purpose tive organizational work practices (Susman et al., 2003). and work across links strengthened by information, com-The use of virtual teams will change the communication munication, and transport technologies.” Another pattern both within and outside the firm. Successful colladefinition suggests that virtual teams are distributed work borations require more than the mere use of electronic teams whose members are geographically dispersed and communication and involve new skills and a supportive coordinate their work predominantly with electronic infor- context that provides commitment and resources to facili-

215

Ale  Ebrahim et al.  

Figure  3 Modified stage-gate: model architecture of the virtual product development process  

216 Afr. J. Mark. Manage.

cisions (Hossain and Wigand, 2004; Paul et al., 2004), tate collaboration (Martinez-Sanchez et al., 2006). provide greater degree of freedom to individuals involved with the development project (Ojasalo, 2008; Company resources Badrinarayanan and Arnett, 2008; Prasad and Akhilesh, 2002), Greater productivity, shorter development times Virtual team provides cost savings to employees by (McDonough et al., 2001; Mulebeke and Zheng, 2006), eliminating time-consuming commutes to central offices Producing better outcomes and attract better employees, and offers employees more flexibility to co-ordinate their Generate the greatest competitive advantage from limited work and family responsibilities (Johnson et al., 2001). resources (Martins et al., 2004; Chen et al., 2008c; Rice Virtual teams overcome the limitations of time, space, et al., 2007), Useful for projects that require cross-and organizational affiliation that traditional teams face functional or cross boundary skilled inputs (Lee-Kelley (Piccoli et al., 2004) and able to digitally or electronically and Sankey, 2008), Less resistant to change (Precup et unite experts in highly specialized fields working at great al., 2006), Facilitating transnational innovation processes distances from each other (Rosen et al., 2007). (Gassmann and Von Zedtwitz, 2003; Prasad and Top management support is a strong motivational Akhilesh, 2002), higher degree of cohesion (Teams can factor in the entire new product process. Although collabe organized whether or not members are in proximity to borative tools are able to assist top management but one another) (Kratzer et al., 2005, Cascio, 2000; Gaudes many managers are uncomfortable with the concept of a et al., 2007), Evolving organizations from productionvirtual team because successful management of virtual oriented to service/information-oriented (Johnson et al., teams may require new methods of supervision 2001; Precup et al., 2006) and provide organizations with (Jarvenpaa and Leidner, 1999). Management unprecedented level of flexibility and responsiveness commitment provides organizational support for change, (Hunsaker and Hunsaker, 2008; Chen, 2008; Pihkala et generates enthusiasm, provides a clear vision of the al., 1999; Liu and Liu, 2007). Beside these advantages product concept and assures sufficient allocation of virtual NPD teams are self-assessed performance and resources (González and Palacios, 2002). high performance (Chudoba et al., 2005; Poehler and Information sharing has been identified as an important Schumacher, 2007), employees perform their work withsuccess factor in NPD (Ozer, 2006). The positive impact out concern of space or time constraints (Lurey and of information sharing on the success of new products Raisinghani, 2001), optimize the contributions of has long been established in the NPD literature (Sridhar individual members toward the completion of business et al., 2007; Furst et al., 2004; Merali and Davies, 2001; tasks and organizational goal (Samarah et al., 2007), Lipnack and Stamps, 2000). reduce the pollution (Johnson et al., 2001), manage the Virtual teams reduce time-to-market (Sorli et al., 2006; development and commercialization tasks quite well Kankanhalli et al., 2006; Chen, 2008; Shachaf, 2008; Ge (Chesbrough and Teece, 2002), Improve communication and Hu, 2008; Guniš et al., 2007). Lead time or time to and coordination, and encourage the mutual sharing of market has been generally admitted to being one of the inter-organizational resources and competencies (Chen most important keys for success in manufacturing et al., 2008a), employees can more easily accommodate companies (Sorli et al., 2006). Time also has an almost both personal and professional lives (Cascio, 2000), 1:1 correlation with cost, so cost will likewise be reduced cultivating and managing creativity (Leenders et al., if the time-to market is quicker (Rabelo and Jr., 2005). 2003; Atuahene-Gima, 2003; Badrinarayanan and Arnett, Virtual teams overcome the limitations of time, space, 2008), facilitate knowledge capture and sharing and organizational affiliation that traditional teams face knowledge, experiences (Rosen et al., 2007; Zakaria et (Piccoli et al., 2004) and reducing relocation time and al., 2004; Furst et al., 2004; Sridhar et al., 2007), Improve costs, reduced travel costs (Bergiel et al., 2008; Fuller et the detail and precision of design activities (Vaccaro et al., 2006; Kankanhalli et al., 2006; Olson-Buchanan et al., al., 2008), Provide a vehicle for global collaboration and 2007). Virtual NPD teams overcome the limitations of coordination of R&D-related activities (Paul et al., 2005), time, space, and organizational affiliation that traditional Allow organizations to access the most qualified teams face (Piccoli et al., 2004). Virtual R&D team is able individuals for a particular job regardless of their location to tap selectively into a centre of excellence, using the (Hunsaker and Hunsaker, 2008) and Enable organiza-tions best talent regardless of location (Criscuolo, 2005; to respond faster to increased competition (Hunsaker and Samarah et al., 2007; Fuller et al., 2006; Badrinarayanan Hunsaker, 2008; Pauleen, 2003). and Arnett, 2008; Furst et al., 2004). The ratio of virtual R&D member publications exceeded Virtual team also, respond quickly to changing from co-located publications (Ahuja et al., 2003) and the business environments (Bergiel et al., 2008; Mulebeke extent of informal exchange of information is minimal and Zheng, 2006), able to digitally or electronically unite (Pawar and Sharifi, 1997, Schmidt et al., 2001). Virtual experts in highly specialized fields working at great teams have better team outcomes (quality, productivity, distances from each other (Rosen et al., 2007), more and satisfaction) (Gaudes et al., 2007; Ortiz de Guinea et al., 2005; Piccoli et al., 2004), Reduce training expenses, effective R&D continuation decisions (Cummings and Teng, Faster Learning (Pena-Mora et al., 2000, Atuahene-Gima, 2003; Schmidt et al., 2001), most effective in making de-

Ale Ebrahim et al. 217

tion and collaboration in business and manufacturing 2003; Badrinarayanan and Arnett, 2008) and finally applications. Most companies today are divided in greater client satisfaction (Jain and Sobek, 2006). different departments located in different geographical places and dealing with specialized tasks. So using KEY FACTORS FOR SUCCESSFULLY IMPLEMENT-

collaborativetools enables authorized users in geogra- INGVIRTUAL TEAM IN NPD

phically dispersed locations to have access to the company’s product data and carry out product development

NPD is continuing to be an area that is receiving work simultaneously and collaboratively on any operating

increased attention, both in practice and academic systems.

spheres (Shani et al., 2003). Eppinger and Chitkara The modified Stage-Gate system has demonstrated to

(2006) studied global product development (GPD) base be a good development platform for the NPD. In order to

on virtual teams, for companies in the manufacturing integrate and share the information and knowledge

sector by conducting interviews with 30 executives and available within geographically distributed companies,

surveying over 1150 product development executives and this model can be a reference model. The proposed mo-professionals from large manufacturing companies. They del architecture of a virtual product development process,

reported the following ten key success factors for does not aim to replace the existing systems in com-successful GPD:

panies but rather to be a support tool for communicating and sharing knowledge among the disperse partners. - Management priority and commitment - Commitment Modified Stage-Gate system will lead to the production of from management to make the necessary organization, better and more cost effective products, developed in a process and cultural changes to make GPD work. shorter period of time. - Process modularity for global distribution - Ability to In highly competitive era which forces companies to separate activities into modular work packages for global launch a new product faster, the decision on setting up distribution.

virtual teams and using a modified NPD process is not a - Product modularity to develop subsystems or choice but a requirement. The theme of virtual teams and components in different locations - Ability to break down application of a collaborative tool in NPD has not been into subsystems for global distribution. much explored and researchers in this field are - Core competence so the company does not become encouraging more studies and analyses to be made. completely reliant on suppliers or contractors - Good understanding of what the company’s core competencies are, so that do not get outsourced. REFERENCES

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