MIT Reports to the President 1998-99


The Center for Innovation in Product Development, an interdisciplinary program between the School of Engineering and the School of Management, defines itself as an engine of innovation for the product development system in the United States. The center envisions an America in which industry achieves and sustains the highest levels of customer satisfaction and product value while enjoying long-term vitality and profitability. Each American company will become more competitive by creating and using the right information at the right time, making informed decisions about product development, and improving its ability to learn and adapt to changes in product development processes. To those in the center, the product development system encompasses the conception, planning, definition, development, demonstration, delivery, and support families of products and services.

For its overarching goal, the center (comprised of representatives from academia, industry, and government) will advance the theory and practice of product development to such a degree that American industry will double the effectiveness of its annual investment in product development over the next decade. To that end, the center is developing programs in the areas of research, education, and outreach. Over the past year, the center has accomplished the following:


The center has organized its research program into four thrust areas: Product Portfolio Definition, led by Kevin Otto, Robert Noyce Career Development Assistant Professor; Information-Based Product Development, led by Associate Professor of Management Science Stephen Eppinger; Enterprise Strategy, led by Management Associate Professor of Management Rebecca Henderson; and Effective Enterprise Learning, led by Visiting Scholar David Bell of the Xerox Corporation. Over the past year, the center has further refined its research process for students and faculty. Research begins by developing testable hypotheses. Students and faculty then gather information on site at center partner companies (which act as research sites), bring it back to campus, and use it to develop ideas, software, and other representations to test, evaluate and demonstrate the hypotheses.

The center initiated research programs with all of its corporate partners, as well as with several affiliated companies. Four examples are particularly worth noting.

Research at the Jet Propulsion Laboratory (JPL) in Pasadena, CA, resulted in a model for the design and selection of families of products that allow designers to quantify the value of alternative product families and select the ones that are more valuable to a firm. The model also accounts for uncertainty during development and commercialization of the products, while incorporating the effect of the design choices on the uncertain factors. At JPL, the model was used to evaluate alternative telecommunications platform investment decisions for spacecraft. It is now being considered for wider use at the laboratory.

At Xerox, coupling the analysis of customer needs with the functional requirements of xerographic products yielded a structured method to identify portfolio architecture alternatives. Typically, firms define portfolios by launching a single product and later developing derivatives off of that initial offering. The difficulty in selecting an appropriate platform is that to support the demanded variety, it soon becomes complex in modules and interfaces. The new method clusters functions that can serve as a roadmap for future technology development. Modules that would be applicable in many products may be defined and mass produced to be part of a large, customizable product technology strategy. These core modules may be arranged into a host of products, since they would embody the core features of the product family. This method gives firms a way to deal with the complexity that arises as a product platform encompasses a multitude of customer options.

At the Ford Motor Company, a pilot program of the modeling framework DOME (Distributed Object-based Modeling and Evaluation) was begun. DOME is an integrated product development tool that uses different "lenses," allowing a user to apply different criteria to evaluate a design problem. For example, a designer can use a lens to evaluate the performance of the design in terms of cost and safety. By creating appropriate representations of the design model, people from different domains, such as designers and managers, will be able to easily perceive the information and interconnections of complex models in the best way possible.

At Ford Motor Company, Design Structure Matrix (DSM) models recommended new ways to organize work teams around the flow of highly related information. Ford now recognizes DSM as a corporate best practice. DSM provides a framework and a compact notation to show the interrelationships and information flow between tasks. Vital to the timely and accurate execution of any process is the control of communication between tasks in a feedback loop.

Several books, written or updated with funds provided by the center, are also of particular importance. Businessweek chose CIPD Professor Michael A. Cusumano's recent book, Competing on Internet Time: Lessons from Netscape and Its Battle with Microsoft (co-authored with David B. Yoffie) as one of its top 10 business books of 1998.

Professor Steven Eppinger is updating his bestselling book, Product Design and Development (co-authored with Karl T. Ulrich). A widely used textbook on structured methods for product development, Product Design and Development will soon be supplemented with an instructors' guide and web-based resource for both instructors and students.


The center advocates that instruction in the process of competitive product development be a standard component of both engineering and management education, first throughout MIT, then throughout the country. All mechanical engineering undergraduates at MIT now take a senior level course in the product development process, in which they encounter many of the same issues that teams in industry face.

The center further enriched CIPD students' educational experiences with a lecture June 24, 1999, sponsored jointly by the center and IDSA Boston. "Designing a Brand: The Story of Kitchen Tools" drew an audience of about 100 people. Designers from Black & Decker Household Products and Ziba Design told the story of how their companies, worked together to design a new product line for Black & Decker. Their lecture illustrated how teamwork, communication, and industrial design are invaluable to the product development process. Many CIPD students in attendance had not previously considered or been exposed to the importance of industrial design. The collaboration between CIPD & IDSA Boston worked so well, it was decided that more joint activities would take place during the coming academic year.

In 1998, the center joined with the System Design and Management (SDM) Program, University of Detroit Mercy in Detroit, and Rochester Institute of Technology in New York in 1998 to form PD21, Education Consortium for Product Development Leadership in the 21st Century. This consortium has developed the Product Development Leadership (PDL) Program, which confers a master's degree in product development that is a dual degree in engineering and management. In July 1998, the Consortium conducted the first annual workshop to begin to develop a common language and understanding between and among the three universities; to enhance integration of the program across traditional academic boundaries; and encourage a spirit of camaraderie amongst the working group members. In 1998, the center devoted substantial funds to creating new courses for the PD21 curriculum. The first class entered this past January, with about 100 students in cohorts in Detroit, Rochester, and MIT.

The continuing education of working professionals is also very important to the center. Two Special Executive Program courses, developed with center resources, are especially noteworthy. Professor Rebecca Henderson's new course, "Developing and Managing a Successful Technology and Product Strategy," held April 14—15 and June 21— 22, 1999, provided a framework for understanding how technologies and markets evolve, how they are linked, how technologies differ across markets, and how new technologies get accepted. Developing a successful technology and product strategy presents problems that extend from R&D to manufacturing, engineering, project management, and new ventures. It's not enough to have a great idea. If R&D dollars are going to pay off in profitable products and technologies, one needs a strategy that not only makes markets but also bests the competition.

Professor Steven Eppinger's course, "Product Design, Development and Management," held June 21—25, 1999, presents the product development process as an information processing system in which customer needs can be efficiently transformed into successful product designs and manufacturing plans. In today's competitive marketplace, firms need to continually develop superior products and must be able to react quickly to technical and market changes. Product development capability has therefore become an essential element of successful business strategy.

Center research has shown that a combination of formal presentations and independent study via the internet can convey material more effectively than more traditional teaching methods in a given amount of time. Based on the work at MIT, a large-scale pilot test was begun at Ford in September, 1998, in which six courses have been modified to include internet based teaching modules designed to the format created at the center.


The third annual Key Characteristics Symposium, organized and facilitated by Professor Anna Thornton, drew 68 people from 23 organizations to Phoenix, AZ, on January 13—15, 1998. The purpose of this seminar series is to bring experts from a variety of companies together to share experiences, successes, and problems with Key Characteristic methodologies. Complex products can contain millions of dimensions and characteristics (voltages, forces, etc.), each of which impact the performance of the product. In addition, each of these features as manufactured will deviate from its nominal value because of inherent variability in manufacturing, assembly, and environment. However, only a small few of the millions of features, the Key Characteristics of the product, will significantly affect the final quality, performance, and cost of the product.

The center and the Industrial Liaison Program, along with several other MIT programs and centers, sponsored the first annual Manufacturing and Engineering Conference at MIT on April 20—21, 1999. This year's conference, entitled "Innovations in Product Development: Bringing Successful Products to Market: The Emerging Competitive Battleground," provided a special strategic briefing for senior manufacturing, engineering, technical, operations, and corporate executives. Led by noted academics and industry experts, the conference explored the progress being made in new ways to identity market opportunities, understand customers, design and deliver product portfolios and services, and better manage the product development process.

Under the auspices of the center's outreach program and supported by a Research Experience for Undergraduates (REU) grant from the National Science Foundation, six undergraduates from universities across the nation joined center scientists and engineers in June, 1999, to experience first-hand how basic research is carried out. The ten-week summer program, which began in early June, targets talented, underrepresented minority and women sophomores and juniors.

CIPD also sponsored eight students in the Undergraduate Research Opportunity Program (UROP) for the spring, allowing them to further develop ideas and products begun in the Second Summer Program on Product Design and Development in January, 1998. Two center staff members, Dr. William Finch and Dr. Diane Hauer Soderholm, had been teaching assistants for the program.


The center welcomed Maurice Holmes, who became MIT's first Professor of the Practice in Management through a joint appointment in the Sloan School of Management and School of Engineering. Also named professor of the practice in engineering, Mr. Holmes will be the second to hold that title in the School of Engineering. Mr. Holmes, one of the world's leading experts in product delivery, was formerly corporate vice president and chief engineer at Xerox Corporation.

The center also hired Jane Williams as the Finance and Operations Manager, Dr. Diane Hauer Soderholm as the Education Coordinator, and Kathleen Wang as the Director of Industrial Collaboration.

More information about this center can be found on the World Wide Web at

Warren Seering

MIT Reports to the President 1998-99