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Management of multinational product development / by Rand P. Pohl.

by Pohl, Rand P.

International business enterprises

ix, 102 leaves : ill. ; 29 cm.

Introduction -- Implementing differentiation to become a product development leader -- International product development teams -- Establishing effective communication within a multinational work team -- Survey -- How to benefit from cultural differences within a multinational work team -- How to evaluate and learn from work team performance -- Summary -- Appendix: Survey comments.

A survey of a U.S. manufacturing firm competing in a global environment demonstrates a need for improved new product development methods. Deficiencies identified include the following: 1. Global awareness and mind set are important to the firm yet they are perceived as a relative weakness. 2. Poor harmonization exists within product families and between product lines. 3. Products are not differentiated enough from competitive offerings. This essay discusses an opportunity to resolve these problems and attain product development leadership through the use of an international design team. Leadership can be realized in terms of creating different and superior products resulting in improved efficiencies for the firm and possibly a sustainable competitive advantage. Significant leverage can be realized from international teams in several ways. First, the team can disseminate global information regarding competitive product offerings, customer requirements, technical standards, and government regulations. Second, global members can make important contributions by acting as "independent evaluators" to foster harmonization within and between product families. By comparison, a national product development effort would be handicapped in these areas, resulting in problems identified by the survey. Communication and culture are discussed with the intent to provide an overview for the manager or team leader faced with the task of establishing a successful international product development team composed of Americans and Europeans.

During new product development, communication is fast paced and usually deals with only partial information. Effective communication helps ensure that proposed solutions are appropriate, and encourages a collaborative attitude. The challenge for management is determining how to establish and maintain effective communication, to keep valuable ideas flowing between globally dispersed groups of engineers, marketing and production staff. Like other management circumstances, there is no one solution to every team’s challenges. When true international developments are started, a portfolio of mechanisms must be considered to support communication. Consideration should be given to the following: Socialization efforts that encourage situations conducive to forming important relationships necessary for informal communication channels. Social events often start good information flows and can be centered on special events such as when globally dispersed members assimilate for meetings. Socialization could include visiting culturally significant locations or events in the host country. Collocating project team members encourages trust between them and fosters open, person-to-person communication. Collocation allows members of the staff to interact on a daily basis and promotes timely decisions.

Establishing a communications management position with a person that has good contacts and the ability to translate information from other facilities into the jargon of his or her own facility. This person can improve the flow of information and act as a focal point, eliminating redundant activities of duplicate requests for the same information. Implementing rules and procedures enhances formal communication through regular reporting and documentation. Formal project plans or schedules can serve to communicate the team's performance and encourages interaction of team members, since members often must correspond with each other to complete their activities. Utilize electronic communication between globally dispersed design team members, to make communications problems more manageable. However, several pitfalls of electronically transmitted data reveal that it cannot be the sole source of information. Periodic face to face contact seems necessary to maintain confidence at a level high enough to promote successful team progress. Project managers must also carefully consider the effect language will have in the project. Special resources may be required for oral and written translations. Meetings and decisions may take longer. Written communications may require translations which can cause delays, and miscommunications may cause errors. Culture is another significant consideration with multinational product development. In general, people regard foreign cultures as inferior.

This is true for almost all societies in the world, but the U.S. geographic distance from truly different cultures (with the exception of Mexico) has made it possible to enjoy the luxury of this point of view, unchallenged. If Americans want to achieve their goals in conducting business overseas, they must learn the basic anomalies of their host country. It is also important to consider management qualities that are not normally taught in business schools. These include flexibility, a sense of humor, patience, sensitivity, an ability to evaluate assumptions, a willingness to listen to others, curiosity, respect for differences, and trust in the ability of the team to out perform individuals. Finally, a much overlooked area that is common to most product development efforts is evaluating performance and continuously learning from it. The product development process should be considered both (1) as individual parts such as producing a detailed design, and (2) as a whole, from customer requirements to the eventual fulfillment of those requirements. In this way, process control techniques can be applied, similar to those used in manufacturing. Many firms do not make the effort to retain knowledge and thus spend considerable time repeating what should have been learned before. Methods to address this problem include establishing an internal data base, and implementing tools such as checklists, project schedules, and metrics to collect information throughout each phase of a product’s development.

A company's competitive advantage in many ways can be attributed to the capacity of its individuals to learn from his or her own mistakes, and those of others. Establishing an effective learning process in product development is one of the most difficult and critical processes an organization can accomplish. This is the reason why achieving a sustainable competitive advantage is so difficult. The advantage is not the result of a particular project, rather it is based on continually building and improving procedures, processes, and leadership skills to do things faster, more efficiently, and better.

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