Robert Frodl, Plexus director of customer development, explains how managing alliances can be key to successful product development
When it comes to developing and manufacturing a new product, there is often the need for different teams, or even different companies, to liaise and collaborate in order to make it a reality. In order to avoid a case of ‘too many chefs’, an alliance such as this needs to be carefully considered and managed.
A case, well reported in the media, where this went awry was an aerospace project with development and production spread across the continent. Nearing the end of the build a problem was encountered: the cables were too short. This resulted in a blame game culture with one group of engineers feeling that another’s solution was being imposed upon them. It turned out that it was an out of date tool in one country that had led to the expensive discrepancy.
To avoid complications such as this designers and engineers from all parties involved need to be talking and working together at the earliest stage possible. Lessons were learned on this occasion and a more open and closer international working environment developed.
In the electronics industry too there is a potential for this to occur. The pressure on shortest time to market, alongside the drive for the lowest total cost of ownership, is leading to alliance programmes where value-chain partnerships, with complementary core competencies, come together to hit these targets. In order to mitigate the risks of complexities and cultural differences, a high level of integration needs to be achieved from day one.
The aim is to get from a product idea to a sellable product: from the concept finding phase to a product that will serve the market well during its lifecycle, typically including various product upgrades. However, the traditional engineering approach is still often sequential and does not account for misaligned incentives that can occur between the product’s design teams and production and supply chain teams.
Designing a product for optimal performance and designing a product for ease of manufacturability and supply chain management require very different processes. Often these have competing priorities. It is still the case that a design team may pass a design ‘over the fence’ for manufacture without any prior collaboration with the production team. It is, with management support guiding the teams to do extra work, possible to get back on track. But back on track often means a budget over-spent.
To avoid these situations, effective relationships need to be built at an early stage of a product’s development. These may be interdepartmental, between companies or on an international scale. Whatever the scope, defining the rules of engagement (communication) for all parties at an early stage in a formal, contractual agreement is the best approach.
Silo thinking needs to be eliminated and common goals agreed with a high level of integration developed between all stakeholders. This way, expectations will be managed, leading to happy teams, and the customer will be more satisfied with the progress of its product.
There are five different levels of integration that need to be met – from operational and tactical through to cultural and interpersonal:
Operational – looks at the level of day to day interaction, organises regular project meetings and agrees aligned quality management systems across the partnership.
Strategic – this requires a senior level input with governance meetings and periodic business reviews between the stakeholders.
Tactical – which covers quality management and design and development plans. It will also define whose tools will be used; what activities are deliverable by whom and when; terminology usage such as ‘prototype’, which can mean different things in different companies. It is often best to work out early on what the intent really is and how it should be phrased.
As an example, working on a negotiation between Austrian, North American and German partners, the discussion was on the design of a large point of sale machine. The US contingent talked about design in terms of mechanical development, including material selection and manufacture. However, the Austrian partner was thinking of the design in terms of delivery of brand image and easy customer interaction with the interface. The talk continued at cross-purposes for a while!
Cultural – perhaps the most difficult to define are the cultural and interpersonal levels of integration. Most people have experienced differences in cultures in the workplace and there is increasing complexity as companies become more global. This means there is a need to be open to the fact that there are differences you may need to explore, understand and mitigate. It is by detailing the common vision and having a framework for an across culture learning ground that this divide can be bridged.
Interpersonal – building networks can provide common grounds leading to the development of trust between the stakeholders and increase levels of meaningful communication. It is at the initial proposal stage that much of this needs to be defined – further down the line and problems will continue to pop up that hold up production. It is essential at this point that the fundamental principles of the relationship(s) between stakeholders are laid down and general deliverables divided amongst them. The scope of the project should be described and defined, ensuring all participants clearly understand the work to be done. It will provide the foundation for a winning environment that balances rewards against risk.
During the life of the project something will always ‘come up’. With a clear path of action and defined levels for escalation already agreed this should never become a problem. The majority will be covered at Project Team leader level but it is essential to know at what point the next level, Director or Executive, should become involved.
With all these areas covered there should be no barrier to implementing a successful alliance programme for any project. Utilising best practices from all sections of the alliance means that all stakeholders will benefit from the experience and capitalise on a broader base of knowledge. This in turn will ensure the customer wins, however complicated the alliance of teams involved.