New-product strategy and industry clockspeed

被引:89
作者
Souza, GC [1 ]
Bayus, BL
Wagner, HM
机构
[1] Univ Maryland, Robert H Smith Sch Business, College Pk, MD 20742 USA
[2] Univ N Carolina, Kenan Flagler Business Sch, Chapel Hill, NC 27599 USA
关键词
speed to market; time pacing; Markov decision processes;
D O I
10.1287/mnsc.1030.0172
中图分类号
C93 [管理学];
学科分类号
12 ; 1201 ; 1202 ; 120202 ;
摘要
We study how industry clockspeed, internal firm factors, such as product development, production, and inventory costs, and competitive factors determine a firm's optimal new-product introduction timing and product-quality decisions. We explicitly model market demand uncertainty, a firm's internal cost structure, and competition, using an infinite-horizon Markov decision process. Based on a large-scale numerical analysis, we find that more frequent new-product introductions are optimal under faster clockspeed conditions. In addition, we find that a firm's optimal product-quality decision is governed by a firm's relative costs of introducing new products with incremental versus more substantial improvements. We show that a time-pacing product introduction strategy results in a production policy with a simple base-stock form and performs well relative to the optimal policy Our results thus provide analytical support for the managerial belief that industry clockspeed and time to market are closely related.
引用
收藏
页码:537 / 549
页数:13
相关论文
共 36 条
[1]   TECHNOLOGICAL EXPECTATIONS AND ADOPTION OF IMPROVED TECHNOLOGY [J].
BALCER, Y ;
LIPPMAN, SA .
JOURNAL OF ECONOMIC THEORY, 1984, 34 (02) :292-318
[2]   THE DYNAMIC PRICING OF NEXT GENERATION CONSUMER DURABLES [J].
BAYUS, BL .
MARKETING SCIENCE, 1992, 11 (03) :251-265
[3]   Too little, too early: Introduction timing and new product performance in the personal digital assistant industry [J].
Bayus, BL ;
Jain, S ;
Rao, AG .
JOURNAL OF MARKETING RESEARCH, 1997, 34 (01) :50-63
[4]   HIGH-DEFINITION TELEVISION - ASSESSING DEMAND FORECASTS FOR A NEXT-GENERATION CONSUMER DURABLE [J].
BAYUS, BL .
MANAGEMENT SCIENCE, 1993, 39 (11) :1319-1333
[5]  
Bayus BL, 1997, J PROD INNOVAT MANAG, V14, P485, DOI 10.1016/S0737-6782(97)00062-3
[6]  
Billington C, 1998, SLOAN MANAGE REV, V39, P23
[7]  
Blackburn J. D., 1991, Time-based competition: the next battleground in American manufacturing
[8]   New product development: The performance and time-to-market tradeoff [J].
Cohen, MA ;
Eliashberg, J ;
Ho, TH .
MANAGEMENT SCIENCE, 1996, 42 (02) :173-186
[9]  
*CPLEX, 1998, US CPLEX CALL LIB VE
[10]   New product development structures and time-to-market [J].
Datar, S ;
Jordan, C ;
Kekre, S ;
Rajiv, S ;
Srinivasan, K .
MANAGEMENT SCIENCE, 1997, 43 (04) :452-464