Petersen, K.J., Handfield, R.B., & Ragatz, G.L. (2003). A Model of Supplier Integration into New Product Development. Journal of Product Innovation Management, 20(4), 284-299.

Format: Peer-reviewed article

Type: Research — Non-experimental

Experience level of reader: Fundamental

Annotation: Case studies of 17 firms were used to develop a model for supplier integration in the new product development process. The model was then validated by way of a survey of 84 purchasing executives. Findings indicate that suppliers should: be evaluated prior to becoming involved in a project, participate in cost and technology sharing plans early in the process, understand project outcome objectives, and have direct involvement with project teams.

Setting(s) to which the reported activities/findings are relevant: Large business, Small business (less than 500 employees)

Knowledge user(s) to whom the piece of literature may be relevant: Manufacturers, Researchers

Knowledge user level addressed by the literature: Organization

This article uses the Commercial Devices and Services version of the NtK Model

• Supplier involvement on a new product development team can lead to improved project outcomes and reduced technology uncertainty. Involvement may be more beneficial early on during R&D for new products and those that are highly specialized. Later stage involvement may be more appropriate for incremental products and products with short life cycles.
  Survey of 84 companies.
  Occurrence of finding within the model: Step 4.6

• Sharing of technology and cost-related information between suppliers and buyers can improve internal team dynamics as well as exchanges between organizations. One strategy is sharing the organization's technology road map, which details the products and performance criteria anticipated to be developed by the organization over the following years, decade or century. Sharing such information with a supplier may lead to advantages such as reducing technology uncertainty and influencing industry standard designs.
  Survey of 84 companies.
  Occurrence of finding within the model: Step 4.6

• Organizations should carefully study prospective suppliers to identify an ideal candidate. Increasing a buyer's knowledge of a supplier leads to higher levels of trust, which in turn lead to more information sharing and involvement. Some criteria to consider include ability to achieve goals, ramp-up abilities, innovation and technical expertise, training requirements, and resource commitment from top management.
  Survey of 84 companies.
  Occurrence of finding within the model: Step 4.1