Cost targets and time pressure during new product development
Everaert, Patricia Bruggeman, Werner
Everaert, Patricia
Bruggeman, Werner
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Publication Type
Journal article with impact factor
Editor
Supervisor
Publication Year
2002
Journal
International Journal of Operations and Production Management
Book
Publication Volume
22
Publication Issue
12
Publication Begin page
1339
Publication End page
1353
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Abstract
Investigates the impact of using cost targets during new product development (NPD), in terms of design quality, product cost and development time. An NPD environment with cost targets is compared with an NPD environment where design engineers receive no specific cost targets, but are expected to "minimize" the cost level of future products. The impact of cost targets versus no-cost targets is investigated in combination with high/low time pressure. The 2*2 factorial design was tested in a laboratory experiment that simulated a real design process, with customers asking for the highest design quality. The results demonstrate that cost targets during NPD lead to lower-cost new products, while not impairing design quality or development time. However, under high time pressure, cost targets lead design engineers to work longer on the design, without a corresponding cost decrease.
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Keywords
Innovation Management