Scenario-driven modular design in managing market uncertainty

Abstract

Many organisational environments are far from equilibrium. The strategic flexibilities of modular product designs can help organisations prepare for an uncertain future, but managers must develop ways to imagine possible futures in order to use such flexibilities to respond to them. This paper discusses a scenario-based approach to anticipating and responding to uncertain futures by developing modular products that increase a firm's chances of succeeding in multiple alternative futures. After introducing the theoretical basis of this study, a structured approach to operationalising the generation of future scenarios and the development of modular product designs is developed. The approach consists of four stages: (1) the generation of scenarios about future market needs, (2) the translation of those needs into goals for modular designs, (3) the modular design process itself and (4) the evaluation of the modular design process. The modular design process we discuss is a function-based design approach that is form independent and thus allows joint consideration of future market needs and the product functions that can serve those needs. We illustrate our proposed approach by applying it to generate scenarios and modular design criteria for the Closed Circuit Television (CCTV) market in the security equipment sector in Turkey.