Developing a systematic model for early supplier involvement in new product development

This master’s thesis discusses the practices of involving suppliers to a buying company’s new product development projects. The objective of this research was to discover the factors that influence the need and form of early supplier involvement (ESI) and to develop a systematic model consisting of activities and considerations for managing ESI in new product development for a case company. The theoretical part discusses product development and sourcing and early supplier involvement in new product development. The research was carried out as action research for the case company’ sourcing department that was in the process of creating and developing systematic ESI practices based on a new sourcing strategy that was introduced during the research process. The research took place during a total of eight months when the researcher worked as an employee of the case company. Semi-structured interviews and workshops were conducted to gather qualitative data making this thesis a multiple qualitative method study. The data was gathered from cross-functional sources and several key stakeholders were involved in the research. Additionally, material was gathered by informal discussions, participating in two new product development projects at their early phases and accessing the case company’s internal databases. As a result of this master’s thesis a systematic model was created for the case company. The model includes steps, related processes and considerations that should be carried out and acknowledged in terms of managing ESI during a product development process. The model covers activities and considerations taking place before involving a supplier, when selecting a supplier for involvement and when collaborating with a supplier. The case company’s goal of improving collaboration between sourcing, R&D and suppliers was also supported by the change driving nature of action research. For academics this study offers a literature review and summary about the factors that should be considered when managing or thinking about establishing systematic practices for managing ESI in new product development on the operational project level. Additionally, the process of developing ESI practices for a company with a rather special high mix – low volume context is described with supplier perspective included