An Application of Project Management Framework in Product Development: Case Study: Bicycle Manufacturer

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer An Application of Project Management Framework in Product Development: Case Study: Bicycle Manufacturer Yuan-Ho 1 Chen Lunghwa University of Science and Technology,Taiwan yuanho@mail.lhu.edu.tw Ru-Jen 2 Lin Lunghwa University of Science and Technology, Taiwan rjlin@mail.lhu.edu.tw Chiu-Yao 3 Ting Graduate School of Management, National Yunlin University of Science and Technology cyting@mail.lhu.edu.tw Abstract This study targets a R&D project, on bicycle products for young consumers, based on empirical evidence, conducted by the Taiwan Project Management Association (TPMA), a D-class International Project Management Body of Knowledge (IPMBOK), which is a method that processes product development plans, contingent on practical validation, to assess the applicability of the TPMA D-class International Project Management Body of Knowledge system in an actual R&D case study. The findings indicate that the new bicycle of this product design has the following features: fashionable image integrated in design, multi-purpose designs of portability, environmentally friendly, and integrated security design. This project obtained verification and confirmation from the client, and was then successfully completed through manufacturing. This study also found that, the D level property tool of the IPMBOK theory, property of the TPMA, is able to solve problems inherent in product research and development. Keywords: Project Management, TPMA, IPMBOK, Research and Development. 1. Introduction In order for business projects to run smoothly, individual management of project is important. Recent research shows that good project management is the key to business process (Jamieson and Moerris, 2004); today has become a very popular research topic (Qureshi, Warraich and Hijazi, 2009). The main purpose of this study is to explore the TPMA D-class International Project Management, Body of Knowledge for practical validation. The research team selected a target group of adolescents (12 years of age to under 18 years old), familiar with the riding functions of the products, the overall ride comfort, and the preferred components and capabilities of the bicycle products. The aim of this project is to analyze the current preferences of adolescent groups in order to develop the design elements of new bicycle products, which are in accordance with the preference principles of the product design, and fully in line with the physical and psychological needs of the users in the target age group. 85

龍華科技大學學報第三十一期,2011.12 It also aims to seek an innovative direction for a R&D project through degrees of preference. The ultimate goal is to provide target consumers with a product that is. 2. Literature Review Project Management Project refers to the completion of a certain task, by a specific deadline, under technical complexity, dependent on continued coordination and control of progress, costs, and performance (Meredith and Mantel, 1989), which are defined as businesses, though their scheduled time for activities is designed to produce a one-time output or service (Barad and Raz, 2000). Project management has following advantages: (Taiwan Project Management Association Editorial Board, 2008): 1. The one-time events will not be repeated. 2. The ad hoc implementation has start and end dates. 3. There are pre-set goals of a model project. 4. The amount of resources is limited. 5. Project completion meets the desired results. The International Project Management Association (International Project Management Association, IPMA) was established in 1965, with the focus of supplying global project management expertise, and is the world's oldest project management organization. In the 1990s, the project matured, and the two main organizational systems are implemented in advanced countries, such as Europe and the United States. The locations are as follows: Pennsylvania, headquartered in the United States Association for Project Management (Project Management Institute, PMI), headquartered in The Hague with the International Project Management Association(Fan,M., Xiong,P.L. and Huang,C.M., 2006). Taiwan obtained the IPMA membership through the Taiwan Institute of Project Management in 2004 to offer project management knowledge and practical expertise in Taiwan. Project management approaches applications with a focus on time, cost, performance, and clearly defined work management (Cleland and King, 1983). Berkley and Saylor (1994) stated that project management is a management philosophy, a guiding principle, and methodology, aimed at meeting product and service demands of customer s delivery requirements through management techniques and tools. Kloppenberg and Opfer (2002) referred to project management-related research conducted in 1960, which focused on large government defense projects transferred to commercial applications (such as the construction industry, information systems, new product development, etc.). That study showed that 86

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer project management increased business opportunities for future operations; in other words, with good project management capabilities in an organization, its success in project management is almost guaranteed. Product Research and Development As product development can provide business opportunities for future operations, R&D projects are important organizational activities for an enterprise. Most product development requires step by step testing for the completion of a project, thus, a management approach for new product development is more beneficial (Pons, 2008), as product R&D analysis avoids wasting time on technical factors. Product research and development must take into account of customer demand, market prices, and acceptable levels, rather than developing the most powerful commodity (Pai,K.H., 2003). Therefore, enterprises must first research customer demand for new products, because even if R&D ability is good, the developed product may not have a market demand, resulting in unwanted merchandise (Hu,S.C., 2008). Overall, in the product development process, project management tools and technology have been successfully used on complex projects (Kwak and Anbari, 2009), and the rapid and effective development of project management for R&D projects of an enterprise will have a significant effect. 3. Research Methods and Procedures This study follows the International Project Management Body of Knowledge in project management steps (Taiwan Project Management Association Editorial Board, 2008), as shown in Figure 1, through the planning stages of a project in order to apply a number of ad hoc methods, making the project management system more effective, and the implementation of the project under a common communication language to facilitate this project. 87

龍華科技大學學報第三十一期,2011.12 Figure 1 Project Management Steps Set the Project Goals and Project Scope Through this study, actual market surveys and consumer questionnaires are conducted to gather the preferences of a select population of contemporary youth, and analyzes the model preferred components and capabilities to determine the direction of the bike project. The designed elements are based on the analysis results, integrated through form, function, entertainment value, and practical principles of product design. Ultimately, the bike is expected to provide target consumers with a product in full compliance with their physical and psychological bike needs. The objective of this project must meet the SMART principles, including Specificity, which is Measurable, Achievable, Realistic, and Time-bound(Taiwan Project Management Association Editorial Board, 2008). Therefore, the project goals of this project are the following five points: 1. Create a breakthrough-type bike design criteria. 2. Completed design appeals to the purchase intentions of more than 20% of the target groups. 3. Research during an implementation period of six months, June 2, 2008 to November 28, 2008. 4. Study budget of 2 million NT dollars. 5. Progress and cost controls of this study are strictly enforced to progress according to plan. 88

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer Work Breakdown Construct and Responsibility Assignment Matrix Work Breakdown Structure WBS (Work Breakdown Structure) is the deliverable or functional elements of a collection-oriented research data set, from which all research areas are organized and defined, its function is to breakdown the areas within the scope of the study/project, then reassemble it into assigned work packages for easy task management with personnel assigned to planning and resource estimation. WBS, in accordance with the top-down approach of this study, is to establish a dismantling approach for process-oriented activities to organize the operational details necessary to the project, as shown in Figure 2. 89

龍華科技大學學報第三十一期,2011.12 Figure 2 WBS 90

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer Risk Planning Risk is a measured uncertainty in research, and the main risk in research refers to the capacity of a project manager in predicting the output level. The risks that may be forecasted include: increasing the scope of the project design, not meeting the demands of manufacturers, delay of the project schedule delays, disputes regarding the projects, high prices of materials, poor integration between the materials and existing product, false answers filled out by the respondents, invalidity of the questionnaire, and failure of the product model test. The probability of each risk occurring and its impact are obtained by multiplying the product of the two, namely, the risk priority number (Risk Priority Number, RPN). This study selects risk items and risk response plan in the high-risk area and greatest risk area (i.e. RPN 40 to 100) for priority planning, as shown in Table 1. Table 1 Risk Planning Table The No. Work Package Risk Project probability effect of the RPN Risk response plan Risk managers size Prior consultation with 1 Project Scope Increase the scope of the project 8 9 72 the client, the need to repeatedly confirm the Planning Team Leader scope of the study Repeated 2 Design Design does not meet the demand of the manufacturers 8 8 64 through recognition of the manufacturer specifications, Production Team Leader requirements, 91

龍華科技大學學報第三十一期,2011.12 and process variables Research managers fulfill its oversight 3 Project duration The ad hoc time-delay 10 5 50 responsibility in order to reduce the number of Project Manager hours in consideration of delays 4 Software purchase Contractual disputes arising 6 8 48 Sufficient communication to establish an agreement to the terms of the contract Project Manager, Finance Team Leader 5 Materials Material prices are too high and materials are integrated with the existing non-performing product 5 8 40 Shop around for lower prices through special channels and select the quality and specifications consistent with an alternative Finance Team Leader 4. Results and Discussion Market Feasibility Analysis In this project, an ad hoc group investigation was conducted by questionnaire survey 92

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer conducted on general consumption in regard to the research and development of a project bike, in order to find out the purchase intentions of the consumers. The questionnaire results showed that: (1) The reasonable price ranges perceived by young respondents 7% 43% 50% 15,000 以下 15,001~20,000 20,001~25,000 Figure 3 The reasonable price ranges perceived by young respondents Most young respondents think a reasonable bicycle price is between 15, 000 ~ 20,000 NT dollar, and 43% of young respondents think a price between 20,001~25,000 NT dollar is a reasonable range. Very few respondents think the price should below 15,000 NT dollar. (2) Survey of preferred bicycle styles of young respondents Off-road bikes 7% 63% Mountain bikes Lady-style bikes 30% Off-road bike Lady style bikes Mountain bike Figure 4 The preferred bicycle styles of young respondents More than half of the respondents prefer mountain bikes, 30% prefer lady-style bikes, 93

龍華科技大學學報第三十一期,2011.12 and 7% prefer off-roadbikes. (3) The main motivation to purchase, according to the findings Following the trend 8% Short-term travel 33% Other 0% Sports & Leisure 24% Sports & Leisure Commuting Short-term travel Follow the trend Commuting Other 35% Figure 5 Main Purchase Motives Most young people use a bicycle for commuting (35%), short-term travel (33%), sports and leisure (24%), and following the trend (8%). (4) Factors of purchase intention Price Material 8% 12% Color 15% Other 3% Model 30% Model Function Color Material Price Function Other 32% Figure 6 Factors of Purchase Intention The main consideration is the functions (32%), followed by model (30%), material (12%), price (8%), color (15%), and other factors (3%). 94

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer (5) Main considerations when purchasing a bicycle Good texture 13% Innovative feature Cheap price 5% Others 3% Individual style 10% Comfortable ride 20% Individual style Comfortable ride Security considerations Popular model Good after-sales service 10% Innovative feature Good after-sales service 7% Popular model 17% Security considerations 15% Good texture Cheap price Others Figure 7 Important Considerations When Buying a Bicycle Important considerations when purchasing a bicycle include a comfortable ride (20%), popular model (17%), good texture (13%), innovative features (10%), and individual style (10%). (6) Functions Table 2 Survey on Bicycle Functions Project on Yes No Whether the bike has variable speed functionality 100% - Whether the bike is foldable 33% 67% Availability of audio equipment 87% 13% Survey of young people's preferences show that variable speed functions is a necessary condition, but the folding function is not (67%), capability of playing MP3 (87%) has a growing percentage in preference. 95

龍華科技大學學報第三十一期,2011.12 (7) Consumers willingness to purchase Consumers willingness to purchase (product development) No purchase intention 13% Willingness to purchase 87% Figure 8 Willingness To Purchase A Bike With MP3 Features The preliminary investigation showed high willingness of consumers to buy a bicycle with new features (MP3 audio), which accounted for 87%, while no willingness to purchase accounted for only 13%. Consumers willingness to purchase (product development later) No purchase intention 14% Other 6% Willing to purchase 41% May consider 39% Figure 9 after Purchase Intention Survey Development Product design is presented to the respondents to investigate their willingness to purchase, 41% showed willing to purchase, while 39% had no purchase intention. 96

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer Product design drawings Based on the results of investigation and analysis, consumer preferences in bicycles include that appearance, variable speed features, and seating comfort. The "MP3 audio" is the main design element in this study. According to the above results, the bicycle design principles are listed in Table 3. These principles serve as the basis for new bicycle development in this study. The new design is shown in Figures 10 and 11. Table 3 The Principles Of Bicycle Design No. Pattern elements Design Type 1 Height 100cm 2 Length 143cm 3 Body Material Aluminum 4 Variable function Section 18 Transmission 5 Variable control Handle rotation-type 6 Lighting Embedded in the design and use of cell bodies 7 Audio equipment Embedded design, waterproof design 8 Power Design Renewable power generation and electrical functions 9 Handles Ergonomic design 10 Handle Appearance Streamlined 97

龍華科技大學學報第三十一期,2011.12 11 Seat Design Ergonomic design 12 Pedals Camber angle knee pedal twice 13 Tires Wheel diameter of 26 inches 14 Tooth Chain Cover Anti-involved in the design 15 Paint Scratch-resistant high quality paint Wall-glove packages MP3 audio equipment Embedded lights Anti-roll design High quality paint Figure 10 Bermuda Bicycle Exterior Design Note: The appearance of a reference to the Giant bicycle web site ( http://www.giant-bicycles.com/zh-tw/ ) Compilation made 98

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer Built-in speaker MP3 Player USB slot Figure 11 Bermuda Bicycle Headlights And Special Sound Design The Bermuda style bike shown above has the following characteristics: 1. Integrated design in a popular image 2. Portable multi-functional design 3. Environmental protection and anti-theft design 5. Conclusions and Recommendations This study used a systematic international project management approach for project management through implementation of control stages in order to ensure that research output meets the original plans. Continuous monitoring of the functions and quality of the researched output were carried out to prevent any standard reduction and frequently review the progress of the project, in order to complete the design of a bicycle for youth. The Bermuda bicycle designed by this study meets the features preferred by youth, including portable multi-functional design, integrated environmental protection, and anti-theft features. This study employed a systematic project management model, developed based on the preferences of the youth group, in order to provide an established R&D model to manufacturers as design reference. This product is designed to target only individual bicycles, excluding third-party vehicles and other vehicle types. Future studies can adopt this design for actual production, functional testing, and the basis for market research on new product development. Future studies can target other products or industries to implement the product 99

龍華科技大學學報第三十一期,2011.12 development processes, and compare the R&D project management in different industries. Finally, the proposed implementation of a new project can refer to prior experience or knowledge as reference for the implementation of a follow-up project. 6. Acknowledgement Thanks to the Graduate School of Business and Management of Lunghwa University of Science and Technology Lee, Hsin-Ling, Wu, Meng-Chun, Lin, Li-Ching and Huang, Yen-Jen four graduates of the industry, experienced in providing assistance to complete this practical paper. 7. References 1. Barad, M. and Raz, T. (2000) Contribution of Quality Management Tools and Practices to Project Management Performance, International Journal of Quality and Reliabity Management, 17( 4/5), 571-583. 2. Berkley, B. T. and Saylor, J. H. (1994) Customer-Driver Project Management, New York: McGraw-Hill. 3. Cleland, D. I. and King, W. R. (1983) System Analysis and Project Management, New York: McGraw-Hill. 4. Fan,M., Hsiung,P.L. and Huang,C.M. (2006) Project management elementary knowledge and application practice, Taipei: Po Hung International. 5. Hu,S.C., Chuang,C.S., Su,Y.H. and Cheng,W.C. (2008) Portable CD audio outward appearance design project, Project Management Journal, 1(1), 34-54. 6. Jamieson, A. and Moerris, P. W. G. (2004) Moving from Corporate Strategy to Project Strategy, in The Wiley Guide to Managing Projects, P. W. G. Morris and J. K. Pinto (Eds.), Gibijeb, NJ: John Wiley and Sons, Inc. 177-205, 7. Kloppenberg, T. and Opfer, W. A. (2002) The Current State of Project Management Research: Trends, Interpretations and Predictions, Project Management Journal, 33(2), 5-19. 8. Kwak, Y. H. and Anbari, F. T. (2009) Analyzing Project Management Research: Perspectives from Top Management Journal, International Journal of Quality and Reliability Management, 27, 435-446. 9. Meredith, J. R. and Mantel, S. I. (1989) Project Management, New York: John Wiley and Son. 100

An Application of Project Management Framework In Product Development: Case Study: Bicycle Manufacturer 10. Pai,K.H. (2003), Innovative collaborative product development PDM Application practice. Taipei: China Productivity Center 11. Pons, D. (2008). Project Management for New Product Development, Project Management Journal, 39(2), 82-97. 12. Qureshi, T. M., Warraich, A. S., and Hijazi, S. T. (2009) Significance of Project Management Performance Assessment (PMPA) Model, International Journal of Project Management, 27(4), 378-388. 13. Taiwan Project Management Association Editorial Board. (2008) International Project Management Knowledge System. Kaohsiung: Taiwan Project Management Association. 101

龍華科技大學學報第三十一期,2011.12 少年腳踏車研發專案實務 陳元和 龍華科技大學商學與管理研究所副教授 1 林如貞 龍華科技大學商學與管理研究所副教授 摘要 2 丁秋瑤 3 雲林科技大學管理研究所博士 本研究以青少年腳踏車為研發之產品對象, 運用國際專案管理學會 (International Project Management Association, TPMA)Level D 級國際專案管理知識體系, 進行產品研發過程之實務驗證, 以評估 TPMA D 級國際專案管理知識體系在 R&D 之適用性 本研究主要是以實地驗證方式為之, 運用 IPMA Level D 級專案管理知識, 實地進行產品 R & D 專案管理之驗證, 以修正並經由廠商審核確認整個研發過程 IPMA Level D 級國際專案管理知識體系之管理模式 本研究透過 IPMA Level D 級專案管理知識, 預計研發具有流行意象之整合性設計 可攜式多功能設計 具環保與防盜設計等特色之青少年自行車 關鍵詞 : 專案管理 台灣專案管理學會 國際專案管理知識體系 產品研發 102