Global Product Development Services - An Economic Boon for Clients

                                                                                         

There are massive economic and political pressures for manufacturing companies (such as in the G8 countries) to which they are forced to respond. The combined pressures and responses are radically transforming the industry. The pressures include high-cost labor pools, and costly raw materials (e.g. steel and petroleum).

The responses include internal consolidation, outsourcing to global product development, and assembly flexibility. The companies must change their operations to suit these.

Studies on manufacturing product development have been done that give a picture of the present situation in the industry along with a 5-year forecast. The studies include key areas such as business philosophy, product design tools, communication types and engineering efficiency. A definitive response flagged in the study is a climb in Global Product Development (GPD), or outsourcing to global suppliers.

GPD can be defined as the maximization of financial and operational productivity of the product development process by distributing product development tasks across different regions of the globe to efficiently match value-addition and cost. Part of product development includes marketing activities to recognize and record the needs of the customer.

A key part of product development is engineering activities to conceptualize, design, analyze and refine new product ideas; tasks that plan and document manufacturing, operations and maintenance processes; and sustenance activities for the making of ongoing product updates, changes and refinements.

The studies done show that companies which implement GPD strategies gain substantial financial and operational benefits. Savings around 0.5% of company revenue and 10% of the product development budget can accrue. Other operational enhancements including 24x7 engineering and the generation of specialized skill capacity by reinvesting cost savings are feasible.

Several OEM's have taken up this GPD model leading to restructured global design and operations for optimal utilization of trans-world resources, speed up product development thereby reducing expenses. Proceeding with the implementation of a GPD strategy requires the analysis of product development activities. A company must look at segregation of the high value-addition and the low value-addition activities and then determine the degree of portability of these activities.

The global product development service model is increasingly used in the modern manufacturing world to maximize efficiencies and minimize costs.

About the author:
global product development

Article Source: http://www.Free-Articles-Zone.com