Corporate Decision Making and Part Differentiation: A Strategy for Customer-Driven Product Development Planning

Abstract

A model of strategic planning for product development is introduced which captures corporate decision making from the earliest planning stages to final product success, measured by cost-control and revenue generation stemming from a strong emotional response in customers. The model was created based on observation and interviews ranging from top executives to design team members from all major disciplines at a large automobile company. By mapping an approach to part differentiation based on part complexity and lifestyle (i.e., value) impact onto the decision making model, those decisions most critical to different aspects of the product are identified and more heavily emphasized. Many companies tend to drive the entire process based on cost and technology objectives as a means to maximize profit, rather than by understanding the true impact of customer response to the product as well. In bringing Design strategy decisions into the earliest phases, companies set a strategy that fulfills customer expectations while reducing conflict, delays, added costs, and improving quality. The model helps companies recognize how to structure decisions and allocate resources to appropriately balance costs and customer’s emotional response.