Platform-based product design and environmental turbulence

Abstract

Purpose – When competing in a turbulent environment, strategic flexibility can be a competitive advantage. One source of flexibility is the new product development (NPD) process, or more specifically product design. The purpose of this paper is to investigate platform-based product design and its relationship to environmental turbulence, strategic flexibility, and market performance. Design/methodology/approach – A theoretical model is developed and relationships are empirically tested using structural equation modeling. Data were collected from engineering design managers in the US manufacturing industry. Findings – The paper found that the higher the level of environmental turbulence the more firms turned to platform product design. Also, the higher the level of platform design the higher the level of market performance, both in the short term and the long term. Finally, the paper showed that strategic flexibility positively and partially mediates the positive relationship between platform design and performance. Originality/value – Platform-based product design is a research area noticeably devoid of empirical work. Furthermore, research has called for a better understanding of the different contexts in which platforms are applied stating that platform planning is too often decoupled from NDP strategy resulting in unsatisfactory results.