KNOWLEDGE MANAGEMENT FOR PRODUCT AND PROCESS DESIGN

Gülru F. Özkan, Cheryl Gaimon

College of ManagementGeorgia Institute of Technology

800 West Peachtree Street, GA Tech

Atlanta, GA 30308-0520

MOTIVATIONKnowledge source of competitive advantageFocus: Management of product and process design team knowledge Dynamic knowledge management (Spender, 1996)

Learning-by-doing Lapre and Van Wassenhove (2000, 2001), Ittner et al.

(2001), Biskup and Simons (2004). Induced learning

Mukherjee et al. (1998), Hatch and Mowery (1998), Lapreand Van Wassenhove (2001), Adler and Clark (1991),Goldstein (2003), Carrillo and Gaimon (2000), (2004).

Knowledge transfer

MOTIVATIONInternal Knowledge transfer:

Argote & Ingram (2000), Darr, Argote and Epple(1995), Emery (2002), Szulanski (1996), Teece

(1977),Zellmer-Bruhn (2003)

Knowledge deployment product attributes and process

capabilities

Concurrent Engineering Chakravarty (2001), Ha and Porteus (2001), Krishnan et al. (1997), Smith and Eppinger (1997), Eppinger (2001), Maccormack and Iansiti (2001)

RESEARCH QUESTIONSWhat drives the manager’s strategies for knowledge transfer between the product and process design teams?

What drives the manager’s strategy to pursue induced learning for each team?

How are these strategies impacted by learning-by-doing?

When should the manager delay her pursuit of knowledge transfer and why?

How does time to market pressure affect the development of team knowledge?

Process Design

M(t)

Induced learning

Product Design

D(t)Knowled

ge transfer

Induced learning

Learning-by-doing

MODEL DYNAMICS

Learning-by-doing

Knowledge

transfer

Learning-by-doing

MODEL DYNAMICS

Learning-by-doing

[D(t)]1 a[M(t)]r1

D(t)

ProductDesign

ProcessDesign

M(t)

Process Design

M(t)

Induced learning

Product Design

D(t)

Induced learning

MODEL DYNAMICS

d2(t)[D(t)]4m2g(t)[M(t)]r4

Process Design

M(t)

Product Design

D(t)Knowled

ge transfer

MODEL DYNAMICS

Knowledge

transfer

d1(t)[M(t)]2[D(t)]3

m1b(t)[D(t)]r2[M(t)]r3

CUMULATIVE KNOWLEDGE AND NET REVENUE

The cumulative levels of knowledge embedded in the product over the development cycle by the product (X(T)) and process design (Y(T)) teams

drive net revenue:

V[X(T),Y(T),T]Where,

X'(t) = δ1(t)D(t)

Y'(t) = δ2(t)M(t)

and T is the product release time (terminal time).

MODEL OBJECTIVE

V[X(T),Y(T),T] - {C1[(t)] + C2[b(t)] + C3[(t)] +

C4[g(t)]}dt

(1) (2) (3) (4)

Net revenue earned at the product release

– costs of pursuing(1) & (2) knowledge transfer and(3) & (4) induced learning.

T

0

Knowledge Transfer and Induced Learning for Product and Process Design

Teams

 

, b, , or g

timeT0 tmax

, b, , or g

timeT0

 

CASE 1: Knowledge Transfer and Induced Learning for Product Design

Team

(t)

timeT0

(t)

timeT0 t t

 

(t)

timeT0

CASE 2: Knowledge Transfer and Induced Learning for Product Design

Team

(t)

timeT0

 

CASE 3&4: Knowledge Transfer and Induced Learning for Product Design

Team

t or t

(t) or (t)

timeT0timeT0

(t) or (t)

EXAMPLE: Semiconductor Industry(t)

timeT0

b(t)

timeT0 tb

g(t)

timeT0

(t)

timeT0t

 

Optimal Launch Time (T*)

RHS

timeT*

LHS

VX(T)1(T)D(T)+VY(T)2(T)M(T) = -VT

 

Optimal Launch Time (T*)

RHS

timeT1*

LHS

T*

 

Optimal Launch Time (T*)

RHS

timeT2*

LHS

T*

INSIGHTS ABOUT (t) and (t)Optimal rate of knowledge transfer or induced learning for the product design team is larger if:

the team is more capable of learning-by-doing ( or 1) is large;

the rate of returns of knowledge transfer in either direction (2, 3, r2 and r3) are large;

the rate of returns of induced learning pursued for the product design team knowledge (4) is large;

Marginal value of an additional unit of process design team knowledge (2) is large (small).

CONCLUSIONSWe obtain insights on a manager’s dynamic strategy for induced learning and knowledge transfer in relation to:

team’s ability to benefit from learning-by-doing.

team’s ability to benefit from knowledge transfer

or induced learning.

effect of disruption (cost) due to induced learning

or knowledge transfer.

initial level of product (process) design knowledge.

extent of time-based competition (optimal launch).

relative importance of product versus process

design team knowledge as a driver of net revenue.

FUTURE DIRECTIONSConsider forgetting, or knowledge depreciation.

Various net revenue functions at the product release times reflecting different industries.

Analysis of different representations of knowledge transfer effectiveness.

Numerical examples based on different industry characteristics.

Imperfect knowledge transfer processes.