Strategic design of multiple lifecycle products for remanufacturing operations

ABSTRACT Based on observations from practice, this study analytically investigates product design philosophies for remanufacturing original equipment manufacturers to determine how the optimal design choice depends on market conditions. Though designing to increase the level of remanufacturability can yield increased profitability by lowering remanufacturing costs, several complicating factors exist. We examine how these market factors—industry clockspeed, the level of competition, and the product’s original market value—interact with characteristics whose values are determined by the choice of design paradigm: time-to-market, manufacturing cost, and remanufacturing cost. A key determinant of the optimal design choice is the number of profitable lifecycles that each design choice provides under specific combinations of values for the market factors.

[1]  Chialin Chen,et al.  Pricing and quality decisions and financial incentives for sustainable product design with recycled material content under price leadership , 2014 .

[2]  Kim B. Clark,et al.  Design Rules: The Power of Modularity , 2000 .

[3]  Teck-Hua Ho,et al.  New product development: the performance and time-to-market tradeoff , 1996 .

[4]  Cheryl T. Druehl,et al.  Design for the Environment: Life‐Cycle Approach Using a Newsvendor Model , 2013 .

[5]  Cheng-Han Wu,et al.  Product-design and pricing strategies with remanufacturing , 2012, Eur. J. Oper. Res..

[6]  Mark A. Vonderembse,et al.  Concurrent engineering and its consequences , 2001 .

[7]  Karl T. Ulrich,et al.  Holistic Customer Requirements and the Design-Select Decision , 1999 .

[8]  K. B. Hendricks,et al.  Delays in new product introductions and the market value of the firm: the consequences of being late to the market , 1997 .

[9]  Joe Miemczyk,et al.  Photocopier remanufacturing at Xerox UK A description of the process and consideration of future policy issues , 2006 .

[10]  Gilvan C. Souza.  Closed-Loop Supply Chains: A Critical Review, and Future Research , 2013, Decis. Sci..

[11]  V. Daniel R. Guide,et al.  OR FORUM - The Evolution of Closed-Loop Supply Chain Research , 2009, Oper. Res..

[12]  Bert Bras,et al.  Product Design Issues , 2010 .

[13]  Janice E. Carrillo,et al.  Production , Manufacturing and Logistics Investing in product development and production capabilities : The crucial linkage between time-to-market and ramp-up time , 2005 .

[14]  Kannan Srinivasan,et al.  New product development structures and time-to-market , 1997 .

[15]  Glen L. Urban,et al.  Market Share Rewards to Pioneering Brands: An Empirical Analysis and Strategic Implications , 2015 .

[16]  Gilvan C. Souza,et al.  How Does Product Recovery Affect Quality Choice? , 2013 .

[17]  Su Xiu Xu,et al.  Optimal modular production strategies under market uncertainty: A real options perspective , 2012 .

[18]  Mohan V. Tatikonda,et al.  Integrating Operations and Marketing Perspectives of Product Innovation: The Influence of Organizational Process Factors and Capabilities on Development Performance , 2001 .

[19]  Karl T. Ulrich,et al.  The role of product architecture in the manufacturing firm , 2011 .

[20]  Philip H. Birnbaum,et al.  Strategic management of industrial technology: A review of the issues , 1984, IEEE Transactions on Engineering Management.

[21]  V. Guide,et al.  Production planning and control for remanufacturing: industry practice and research needs , 2000 .

[22]  Karthik Ramachandran,et al.  Design Architecture and Introduction Timing for Rapidly Improving Industrial Products , 2008, Manuf. Serv. Oper. Manag..

[23]  K. Clark.  Project scope and project performance: the effect of parts strategy and supplier involvement on product development , 1989 .

[24]  G. Boothroyd,et al.  Design for Assembly and Disassembly , 1992 .

[25]  G. Stalk.  Time-The Next Source of Competitive Advantage , 1988 .

[26]  Gilvan C. Souza,et al.  Delayed Differentiation for Multiple Lifecycle Products , 2013 .

[27]  H. Mendelson.  Organizational Architecture and Success in the Information Technology Industry , 2000 .

[28]  Michael R. Galbreth,et al.  Product Reuse in Innovative Industries , 2013 .

[29]  Samar K. Mukhopadhyay,et al.  Optimal return policy and modular design for build-to-order products , 2005 .

[30]  Adem Orsdemir,et al.  Competitive Quality Choice and Remanufacturing , 2014 .

[31]  V. Daniel R. Guide,et al.  The Potential for Cannibalization of New Products Sales by Remanufactured Products , 2010, Decis. Sci..

[32]  James F. C. Windmill,et al.  Design for remanufacture: a literature review and future research needs , 2011 .

[33]  Kevin B. Hendricks,et al.  The Effect of Product Introduction Delays on Operating Performance , 2008, Manag. Sci..

[34]  Haim Mendelson,et al.  Industry Clockspeed: Measurement and Operational Implications , 1999, Manuf. Serv. Oper. Manag..

[35]  Karl T. Ulrich,et al.  Fundamentals of Product Modularity , 1994 .

[36]  A. Chakrabarti,et al.  Innovation Speed: A Conceptual Model of Context, Antecedents, and Outcomes , 1996 .

[37]  Christoph H. Loch,et al.  Problem - Solving Oscillations in Complex Engineering Projects , 2003, Manag. Sci..

[38]  Haim Mendelson,et al.  Clockspeed and Informational Response: Evidence from the Information Technology Industry , 1998, Inf. Syst. Res..

[39]  Karl T. Ulrich,et al.  Special Issue on Design and Development: Product Development Decisions: A Review of the Literature , 2001, Manag. Sci..

[40]  Pilar Carbonell,et al.  The impact of market characteristics and innovation speed on perceptions of positional advantage and new product performance , 2006 .

[41]  Charles H. Fine.  Clockspeed: Winning Industry Control In The Age Of Temporary Advantage , 1998 .

[42]  Mark Ferguson,et al.  Remanufacturing and the component commonality decision , 2013 .

[43]  Rommert Dekker,et al.  Inventory Control in Hybrid Systems with Remanufacturing , 1999 .

[44]  Luc Muyldermans,et al.  Hewlett-Packard Company Unlocks the Value Potential from Time-Sensitive Returns , 2005, Interfaces.

[45]  Gilvan C. Souza,et al.  Reverse Supply Chains for Commercial Returns , 2004 .

[46]  L. H. Shu,et al.  Application of a design-for-remanufacture framework to the selection of product life-cycle fastening and joining methods , 1999 .

[47]  L. V. Wassenhove,et al.  Sustainable Operations Management , 2005 .

[48]  L. Beril Toktay,et al.  Market Segmentation and Product Technology Selection for Remanufacturable Products , 2005, Manag. Sci..

[49]  Luk N. Van Wassenhove,et al.  The Economics of Remanufacturing Under Limited Component Durability and Finite Product Life Cycles , 2007, Manag. Sci..

[50]  John K. Gershenson,et al.  Modular Product Design: A Life-Cycle View , 1999, Trans. SDPS.

[51]  Joseph D. Blackburn,et al.  Time-based competition : the next battleground in American manufacturing , 1991 .

[52]  P. Clarke.  The Impact Market , 2015 .

[53]  Gilvan C. Souza,et al.  Time Value of Commercial Product Returns , 2006, Manag. Sci..

[54]  Erwin van der Laan,et al.  Managing consumer returns in high clockspeed industries , 2014 .

[55]  B. HendricksKevin,et al.  Delays in New Product Introductions and the Market Value of the Firm , 1997 .

[56]  Irina Maslennikova,et al.  Xerox's Approach to Sustainability , 2000, Interfaces.

[57]  K. Eisenhardt,et al.  Accelerating Adaptive Processes: Product Innovation in the Global Computer Industry , 1995 .

[58]  Geraldo Ferrer.  On the widget remanufacturing operation , 2001, Eur. J. Oper. Res..

[59]  Martin Charter,et al.  Remanufacturing and product design , 2008 .

[60]  Johan L. Perols,et al.  On the relationship between supplier integration and time-to-market , 2013 .

[61]  S. Vickery,et al.  The ability to minimize the timing of new product development and introduction: an examination of antecedent factors in the North American automobile supplier industry , 2000 .