Platform-based Product Design and Environmental Turbulence: The Mediating Role of Strategic Flexibility
November 13, 2013 Editor 0
Purpose – When competing in a turbulent environment, strategic flexibility can be a competitive advantage. One source of flexibility is the new product development process, or more specifically product design. The purpose of this paper is to investigate platform-based product design and its relationship to environmental turbulence, strategic flexibility and market performance. Design/methodology/approach – A theoretical model is developed and relationships are empirically tested using structural equation modeling. Data was collected from engineering design managers in the U.S. manufacturing industry. Findings – We found that the higher the level of environmental turbulence the more firms turned to platform product design. Also, the higher the level of platform design the higher the level of market performance, both in the short-term and the long-term. Finally, we showed that strategic flexibility positively and partially mediates the positive relationship between platform design and performance. Originality/value – Platform-based product design is a research area noticeably devoid of empirical work. Furthermore, research has called for a better understanding of the different contexts in which platforms are applied stating that platform planning is too often decoupled from new product development strategy resulting in unsatisfactory results.
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