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Editor’s Note: MIT Sloan Management Review first published “The New Practice of Global Product Development” in our Summer 2006 edition. In the article, authors Steven D. Eppinger and Anil R. Chitkara examined state-of-the-art and emerging best practices in global product development (GPD). GPD continues to evolve, and in 2009, we asked Eppinger, the General Motors Leaders for Manufacturing Professor of Management Science at the MIT Sloan School of Management, to update the article with new insights about GPD. His additions are published here alongside the 2006 article, annotating the original text.
Reveal Eppinger’s commentary by clicking on the highlighted passages.
Globalization pressures have begun to have a major impact on the practice of product development across a wide range of industries. A new paradigm has emerged whereby companies are utilizing skilled engineering teams dispersed around the world to develop products in a collaborative manner. Best practice in product development (PD) is now rapidly migrating from local, cross-functional collaboration to a mode of global collaboration. Global product development (GPD) therefore represents a major transformation for business, and it applies to a broad range of industries.
The objective of this article is to present frameworks that can help companies address various strategic and tactical issues when considering adoption of GPD. The concepts have been developed mainly through detailed discussions with managers at more than 100 companies in 15 countries in North America, Europe and Asia. Some data are from a recently completed study on GPD that product development company PTC has conducted with BusinessWeek Research Services, interviewing and surveying more than 1,100 engineering managers worldwide.
In our discussions with managers, many have found the ideas, frameworks and perspectives presented in this article to be helpful in addressing the transformation to global product development and its implementation today.
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5. These specific country categorizations are based on salary survey re- sults obtained from Mercer Human Resource Consulting for a representative type of engineer. (Systems Engineer – Intermediate, defined as “under general supervision, provides technical support to sales force during sales negotiation. Configures hardware, software, and design application requirements of products offered to customers to meet their requirements. Resolves complex technical issues with guidance from senior engineers. Frequently reports to a Systems Engineering Manager. Typically requires a Bachelor’s Degree and two to four years of experience.”)
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