Where process development begins: A multiple case study of front end activities in process firms

Technovation 31 (2011) 490–504

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Technovation journal homepage: www.elsevier.com/locate/technovation

Where process development begins: A multiple case study of front end activities in process firms Monika Kurkkio a,1, Johan Frishammar a,n, Ulrich Lichtenthaler b,2 a b

Lule˚ a University of Technology, Center for Management of Innovation and Technology in Process Industry, SE-97187 Lule˚ a, Sweden University of Mannheim, Schloss, D-68131 Mannheim, Germany

a r t i c l e i n f o

a b s t r a c t

Available online 28 June 2011

The front end phase of the new product development has been examined extensively, yet few if any studies have examined the front end phase of new process development. By means of a multiple case study of process firms, this article aims to bridge this knowledge gap. Our results show that substantial differences in front end activities exist between the product development and process development domains. We conceptualize the front end in process development to be an iterative trial-and-error process, dominated by activities such as idea generation and refinement, literature reviews, anticipation of end-product changes, and various forms of experiments in bench scale, lab scale, and full-scale production. In addition, we highlight key problems in the front end and managerial remedies for how to mitigate them. While these findings provide theoretical implications for research into product development, process development and production management, the findings are particularly relevant to process development managers, plant managers, and development engineers interested in increasing the efficiency of production processes. & 2011 Elsevier Ltd. All rights reserved.

Keywords: Front end Process development Case study Process innovation

1. Introduction Product development and process development constitute two ideal types of innovative activities in industrial firms. Product development is typically driven by the desire to create a new product, but an equally valid type of innovation is process development, which centers on developing the production processes and component technologies that firms use to produce a specific product (McCarthy et al., 2010). Float glass technology in glass manufacturing and rolling mills technology in metals processing are two key examples of technological process development (McCarthy et al., 2010; Utterback, 1994, p. 114). Process development is a major determinant of successful technological innovation (Linton and Walsh, 2008), but relatively few studies address this topic (Reichstein and Salter, 2006). Even fewer studies aim to shed light on the early front end phases of process development, which we do in this article. However, over the past decades, the conduct of front end activities in product development (but not process development)

n

Corresponding author. Tel.: þ46 920 491407. E-mail addresses: [email protected] (M. Kurkkio), [email protected] (J. Frishammar), [email protected] (U. Lichtenthaler). 1 Tel.: þ46 920 491865. 2 Tel.: þ49 621 181 1604. 0166-4972/$ - see front matter & 2011 Elsevier Ltd. All rights reserved. doi:10.1016/j.technovation.2011.05.004

has been a recurrent theme in the literature (e.g. Cooper, 1988; Khurana and Rosenthal, 1997, 1998; Verworn, 2009) and several scholars have found the key to success in product development to reside in the early phases, often referred to as the front end (Cooper, 1988; Koen et al., 2001). The front end starts when a firm has an idea for a new product, and it ends when the firm decides to launch a formal development project or, alternatively, decides not to do so (Kim and Wilemon, 2002). Thus, the front end is the initial phase of the innovation process and it thus precedes the typical ‘‘formal’’ stage-gate approach to product development (Cooper, 2008). Prior research pictures the front end as being ill-defined, unclear, uncertain, and equivocal (McCarthy et al., 2006; Chang et al., 2007). In addition, the front end is often characterized by ad-hoc decision-making and conflicting organizational pressures (Khurana and Rosenthal, 1998; Montoya-Weiss and O’Driscoll, 2000). This makes mistakes hard to avoid and the search for better predictive guidelines justifiable. Indeed, both quantitative (Murphy and Kumar, 1997; Verworn, 2009) and qualitative studies (Brem and Voigt, 2009; Khurana and Rosenthal, 1997; Seidel, 2007) have demonstrated the critical role of front end activities for final product development success. In contrast, the process development literature has not specifically studied front end activities. Rather, this literature has merely highlighted the assumed importance of such activities, but has largely neglected to examine them in detail (Lager, 2000; Lim et al., 2006; Pisano, 1996).

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To a background where front end activities are stressed as the key to effective product development (Cooper et al., 2004; Verworn, 2009), this article aims to shed light on front end activities in the context of process development, i.e. the activities that are conducted before a new process concept is implemented into the production process (Lager, 2002a; Pisano, 1996). The limited attention to this issue in prior literature is somewhat remarkable because effective improvements to manufacturing processes and throughput technology are a key source of competitive advantage in manufacturing firms (Pisano, 1997, p. 4). Furthermore, product development and process development are often tightly linked in the technological core of manufacturing firms with the aim of offering high-quality products to customers (Damanpour and Gopalakrishnan, 2001; Ettlie, 1995; Reichstein and Salter, 2006). Accordingly, proficient process development may be a requirement rather than an option to facilitate successful product development (Brown, 2001; Pisano, 1997, p. 3). These conditions underscore the strong deficit of research into the front end for process development (Lim et al., 2006), which is further highlighted by the importance of front end activities in product development (Verworn, 2009) and the managerial challenges inherent in the front end (Khurana and Rosenthal, 1998). Accordingly, the topic of front end activities in process development appears equally relevant to research and management practice. To this background, the overall purpose of this article is to deepen our knowledge about the front end in process development. Specifically, we explore the sub-phases which constitute the front end in process development and identify the key activities therein. In addition, we elaborate on the tactics which increase speed and quality in the front end of process development. Our article offers several contributions. First, we contribute by presenting a descriptive framework of the front end in process development. This framework can be used by managers and researchers to better understand what happens in the front end and how this initial phase of the ‘‘process development process’’ can be improved. Thus, we shed light on an essential yet underresearched topic in technology and innovation management (Brown and Maylor, 2005). Second, we identify the tactics that increase speed and quality in the front end which are critical to achieve successful process development. While our results highlight some similarities to front end activities in product development, they also show that extant knowledge on the front end in product development cannot be directly transferred to the process domain because of differences in scope and key activities. Accordingly, our findings may be essential to successful process development in firms. Third, we identify important interdependences of process development and product development, which indicate that process development practices may be essential to achieve high product development performance. Altogether, these issues have been pointed out as areas ripe for further study in prior work on process development (Khazanchi et al., 2007; Lager, 2000; Lim et al., 2006; Samson and Whyback, 1998). The remainder of the article is organized as follows. Section 2 presents the theoretical background to our study. In Section 3, we describe the research design. Section 4 reveals the empirical findings and provides analyses of these. In Section 5, we discuss the study’s theoretical and managerial implications before addressing limitations and suggestions for future research.

2. Theoretical background Because the literature on the front end in process development is limited, three bodies of literature were used to ground our

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research theoretically. First, we provide a summary of the process development literature that highlight different interpretations and definitions of process development and show that process development typically is divided into technological and organizational process development. Second, we provide a general overview of the ‘‘process development process’’ and highlight a gap in this literature concerning the front end in process development, which underscores the need for the current study. Third, we briefly review the literature on the front end in product development and discuss how this literature can be used as a starting point for exploring the front end in process development. 2.1. Defining process development Process development concerns improving how work is done (Utterback and Abernathy, 1975), in contrast to product development which focuses on what is done, i.e. the final output sold and delivered to external customers (Gopalakrishnan et al., 1999). Pisano (1997, pp. 29–30) defines process development as a firm’s ability to produce a product or set of products, which involves both the physical artifacts of production, the production techniques, and the operational procedures and routines employed to produce products. Process development thus implies changes in both production technologies and organizational processes. The primary focus of our article is on production technologies as they enable larger changes to the production process (Pisano, 1997, p. 34), such as reducing the number of process steps or the introduction of new production equipment. However, no allencompassing definition of process development exists in the extant literature, but a variety of somewhat similar definitions prevail (Utterback and Abernathy, 1975; Baer and Frese, 2003; Ettlie and Reza, 1992; Khazanchi et al., 2007). Thus, most authors seem to agree on the general characteristics of what constitute process development. Consistent with prior research, we therefore define process development as deliberate and systemic development related mainly to production objectives, implying the introduction of new elements into the production process with the purpose of creating or improving methods of production (Baer and Frese, 2003; Gopalakrishnan et al., 1999, Lager, 2002a, 2002b; Khazanchi et al., 2007; Reichstein and Salter, 2006). Based on this definition, process development first of all implies deliberate organizational attempts to change or modify the production process. That is, improvement efforts are conscious and planned. While process development can occur by serendipity, that is rarely the case (Baer and Frese, 2003). Second, process development does not occur in isolation. Process development is organizationally complex and spans multiple functions which make it systemic. Changes in the production process often affect other processes within a firm (Gopalakrishnan et al., 1999), for example product development, manufacturing strategy, and operations strategy (Pisano, 1997, p. 25). Thus, improvements and modifications of the production process are likely to result in changes to other processes close by. Third, because process development is performed in the context of production, the objectives are typically internal to the firm and often center on cost reductions and improved product quality (Lager, 2002a). Therefore, it is essential to involve operating personnel as they are the ones that will work with the new or improved process (Khazanchi et al., 2007). With involvement come greater motivation and less resistance to change (Frambach and Schillewaert, 2002). Fourth, process development implies the introduction of new elements into the production process (Khazanchi et al., 2007). These elements may include new input materials, task specifications, work and information flow mechanisms, or new equipment used to produce a product (Gopalakrishnan et al., 1999; Reichstein and Salter, 2006).

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Finally, process development occurs on a degree-of-newness continuum. Scholars often distinguish between process innovation and process improvement as two ideal types of process development (Gopalakrishnan et al., 1999; Reichstein and Salter, 2006; Utterback and Abernathy, 1975). As process development itself is organizationally complex and spans multiple functions, from laboratory settings to full-scale trials, the degree of newness is difficult to anticipate in advance (Pisano, 1997, p. 25). Process improvement typically refers to incremental development efforts, such as improvements of existing processes, work methods or routines which may allow slightly increased efficiency or effectiveness (Utterback and Abernathy, 1975). Process innovation, on the contrary, presupposes wider and more encompassing changes to the manufacturing process, such as the launch of a nextgeneration process for a new product (Reichstein and Salter, 2006; Pisano, 1997, p. 34). Thus, process development is a matter of a continuum rather than clear-cut categories ranging between incremental and more radical development efforts. The outcomes of process development are multiple, and vary according to the goals of each specific process development project. Cost reductions, increased production volumes, and yields from production are key examples of desired outcomes (Lim et al., 2006; Pisano, 1994, 1996). Additional outcomes include increased product quality and reliability, reduced time to market, and sustaining more environment-friendly production (Gopalakrishnan et al., 1999; Lager, 2002a; Pisano, 1997, p. 11). A firm’s proficiency in process development determines the extent to which these outcomes materialize. 2.2. Conceptualizing the ‘‘process development process’’ In comparison with the stage-gate literature on the product development process (Cooper, 1988; Cooper et al., 2004), much less attention has been devoted to the ‘‘process development process’’. The few studies that do exist typically focus on this phenomenon in process firms (Lager et al., 2010; Lim et al., 2006; Pisano, 1996). Process development is critical to process firms whose manufacturing processes are inert, capital-intensive, and critical to competitive advantage (Hutcheson et al., 1995). In addition, process development often requires large investments in R&D spending in process firms, compared to other manufacturing industries (Lager, 2002b). One of the first models of the process development work process was proposed by Pisano (1994). This model splits process activities into three stages: process research, pilot development, and commercial plant scale-up. In the first stage, a description of the product concept is made, which in most cases will be incomplete (Pisano, 1996). The product concept is the formula for the changes required to the end product, and it further includes a set of functional target specifications, e.g. unit cost, capacity required, or quality levels. At this first stage, development work is generally performed in laboratory settings, and scientific literature is used as a source to enhance knowledge of key problems (Pisano, 1996). The next stage is referred to as pilot development. This stage is more ‘‘empirical’’ and focuses on scaling up the process to an intermediate level and to anticipate key process parameters, e.g. time and temperature. The third and final stage involves scaling up the process created to full-scale and transferring it to the plant where the process will be adapted and used to produce the product (Pisano, 1994). In a similar vein, Lager (2000) presents a conceptual model for the ‘‘process development process’’, which comprises three stages: (1) identifying internal production needs, (2) process development work in laboratories, including pilot plant and production plant tests, and (3) transferring development results to production. His findings indicate that practitioners often

conduct the first and last stages with low proficiency, although these are indeed critical to accomplish a well-functioning manufacturing process. In addition, Lim et al. (2006) suggest an iterative, multi-phased development model of process development, enacted by studying biopharmaceutical development. The biopharmaceutical context is characterized by radical innovation, thus making this model less useful in the context of this article. However, common to all three models is the importance given to the early stages of process development. Despite the assumed importance of the early stage, however, all of these models lack sufficient details about which activities actually constitute the early stage (Lager, 2000; Lim et al., 2006; Pisano, 1994). As the extant knowledge on the front end in process development is so scarce, the next section revisits the literature on the front end in product development which serves as a guiding device for our empirical study. 2.3. The front end in product development—a feasible starting point for theorizing about the front end in process development? Product development and process development share several key characteristics (Damanpour and Gopalakrishnan, 2001; Ettlie, 1995). For example, they are both core activities in manufacturing firms and they both imply problem-solving activities with the goal of offering a new or improved solution (Gopalakrishnan and Damanpour, 1994; Reichstein and Salter, 2006). In addition, a high degree of cross-functional integration is required for both activities (Pearce and Ensley, 2004; Pisano, 1997, p. 29). Despite these and other common characteristics, process development implies specific contingencies that need to be addressed. For example, process development usually involves larger changes in organizational structures and administrative systems than product development (Gopalakrishnan et al., 1999) However, due to the similarities between the two types, the product development literature seems a feasible starting point for theorizing about the front end in process development. The front end differs in many aspects when compared to later phases in the innovation process (Kim and Wilemon, 2002; Khurana and Rosenthal, 1998). The nature of work in the front end is often ill-defined and experimental (Chang et al., 2007; Koen et al., 2001). The funding in the front end is often limited and future revenues are difficult to calculate (Koen et al., 2002). These conditions make it difficult to employ theory developed for later phases in the innovation process. Thus, we briefly review the front end literature in product development to identify key activities and to see whether these are important in the front end of process development as well. The front end in product development typically starts with an opportunity, and if the opportunity is considered worth exploring, a small team is assigned to investigate it further (Kim and Wilemon, 2002). Proficiency in idea refinement and screening of ideas thus constitute key activities (Griffith-Hemans and Grover, 2006; Khurana and Rosenthal, 1997) as deficiencies here often result in costly problems in later phases of the product development process (Cooper, 1988). Another key activity performed early in the front end is market analysis, which typically contains information about target markets and the definition of market requirements (Cooper and Kleinschmidt, 1987; Montoya-Weiss and O’Driscoll, 2000). In addition, firms typically conduct a preliminary technology assessment, which involves identifying potential technologies and suitable applications for developing the new product as well as an estimation of related costs (Cooper and Kleinschmidt, 1987; Verworn, 2006). Furthermore, it is crucial to determine whether the proposed product fits with existing business plans and to assess synergy with existing products, i.e. product and portfolio strategy

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considerations (Khurana and Rosenthal, 1998). The evaluation of the competitive situation – environmental scanning and analysis – is yet another activity which needs to be addressed during the front end. In particular, competitors’ prospective and current product offerings need to be taken into account when exploring the new product idea (Bacon et al., 1994). Subsequently, a product concept is enacted, which constitutes the ‘‘output’’ of the key activities that have been performed previously. A product concept represents the goals for the development project (Seidel, 2007). In addition, it includes a statement of customer benefits, information about target markets, product specifications, product requirements, and the technology required to produce the product (Cooper and Kleinschmidt, 1987; Montoya-Weiss and O’Driscoll, 2000). Finally, feasibility analysis and project planning are conducted which include tests of the product concept and specifications of the resources that are needed to complete the project (Khurana and Rosenthal, 1997). Altogether, these activities form the basis for the decision to proceed to a formal product development project or not (Khurana and Rosenthal, 1998). Conceptually, some of these activities are likely to be critical for the front end in process development as well (e.g. preliminary opportunity identification, idea refinement, and preliminary technology assessment), while others are clearly product-specific (market analysis, identification of market segment, and an evaluation of the competitive situation). The empirical study to explore these issues is described in the following section.

3. Research design After a detailed literature analysis, our research design was selected to achieve high methodological fit (Edmondson and McManus, 2007). For multiple reasons, a case study was selected as the research strategy for this study. First, the front end in development projects is pictured as complex, consisting of multiple iterative activities (Chang et al., 2007; Khurana and Rosenthal, 1997; Montoya-Weiss and O’Driscoll, 2000), which make the case study a feasible approach. Second, given the background that front end research in process development is severely limited, a case study allowed a more contextual assessment of social phenomena in real-life contexts (Yin, 1994). Third, the limited amount of prior research means that themes and patterns need to be identified rather than confirmed (Edmondson and McManus, 2007; Eisenhardt, 1989). The case study thus allowed for responding to the need for deep understanding and local contextualization (Miles and Huberman, 1994). In designing and conducting the case study, we followed the guidelines in seminal work on case study research (Eisenhardt, 1989; Yin, 1994). A multiple case study approach was preferred because it enabled the collection of comparative data, which is more likely to yield accurate, generalizable theory than single cases (Eisenhardt and Graebner, 2007; Yin, 1994). The cases were selected using literal sampling, with the aim of sampling cases that would replicate each other and consequently extend emergent theory (Eisenhardt and Graebner, 2007; Yin, 1994). 3.1. Research sites Aligned with this sampling strategy, firms in the process industries were deemed relevant for the empirical study. While process firms are a subset of manufacturing firms, they are defined by several typical characteristics. In particular, the input material is typically raw rather than components from suppliers, the production process is capital-intensive and rigid, and process development is critical to competitive advantage in such firms (Barnett and

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Clark, 1996; Lager, 2000; Linton and Walsh, 2008). Furthermore, production plants are typically very large and strongly integrated on one site, and the production process is continuous with on-line control in real time (Hutcheson et al., 1995). Process firms do not constitute a homogeneous group of firms, however, because of differences in the production processes and in the manufacturing strategy (Dennis and Meredith, 2000; Van Donk and Fransoo, 2006). Nevertheless, the activities that constitute the front end in such firms still seem to be similar (Lager, 2002a, 2002b; Lim et al., 2006; Linton and Walsh, 2008). Overall, the process industry can be considered as an ideal setting for a study such as ours, because of the key role played by process development (Barnett and Clark, 1996). Four firms in the metal and mineral industry were selected, as they all had great experience of conducting process development, and good access was given to all firms. Boliden AB is a mining and smelting firm producing mainly zinc and copper. Other important metals produced are lead, gold, and silver. This firm has about 4400 employees in 7 countries. H¨ ogan¨ as AB develops and manufactures metal powders for the global market. Metal powder technology is used in a variety of application areas, including sintered components, soft magnetic composites, hot polymer filtration, and surface coating. The firm has about 1500 employees in 28 countries. LKAB develops and produces upgraded iron ore and industrial mineral products for the steel and other industry sectors, and employs about 3700 persons in 15 countries. SSAB develops and manufactures high-strength steel for the world market. Application areas include bridges, buildings, ships, various forms of vehicles and lifting devices. The firm currently employs around 9000 employees in 45 countries. 3.2. Data collection The primary data source consisted of 32 in-depth interviews, which was motivated by the fact that interviews are an efficient approach to collect rich empirical data (Eisenhardt and Graebner, 2007). Four initial interviews were unstructured and exploratory, and they were conducted with the aim of providing general information on innovative activities as well as identifying suitable respondents for the subsequent investigation. The remaining 28 interviews were semi-structured and specifically addressed the research purpose. We used a ‘‘snowball/chain sampling’’ approach to select the 28 respondents, and this approach allowed us to identify the key persons working with process development (Miles and Huberman, 1994). The sampling approach led to differences in how many respondents were selected at each firm. In all firms, however, respondents were selected from different hierarchical levels to get diverse perspectives of the activities and problems in the front end, which also mitigate respondent bias (Eisenhardt and Graebner, 2007). Table 1 provides descriptive information about the semi-structured interviews. The semi-structured interviews were based on an interview guideline, which was developed drawing on prior work into the front end in product development and general research into the process development work process (see Appendix A). The interview guideline comprised four sections. The first section provided background information about the respondents’ age, education, and work duties. The second section encompassed general questions about the firm’s process development practices and a discussion about how process development work was organized and conducted, with an emphasis on the problems and opportunities associated with the current process development processes. The third section focused explicitly on front end practices, i.e. key activities, roles, responsibilities, problems and opportunities present in the front end of process development. The final set of questions allowed respondents to elaborate upon what drives

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Table 1 Respondents for the semi-structured interviews. Position

Interview date

Duration

Degree

Years of employment

Interviews at Boliden AB Chief Strategy Officer 06/11/2008 Senior Metallurgist 06/11/2008

2 h, 40 min 1 h, 27 min

M.Sc. M.Sc.

15 13

Senior Metallurgist

07/11/2008

1 h, 54 min

Ph.D.

29

Process Technology Development Manager

07/11/2008

1 h, 02 min

M.Sc.

11

Mining Technology Manager Project Engineer

06/11/2008

52 min

M.Sc.

1

07/11/2008

47 min

M.Sc.

24

Senior Metallurgist

07/11/2008

1 h, 48 min

Exploration Director Technology Manager Process Metallurgist

06/11/2008 06/11/2008 23/10/2009

1 h, 03 min 1 h, 32 min 56 min

23 Nonacademic training M.Sc. 9 M.Sc. 30 M.Sc. 4

Process Metallurgist

23/10/2009

56 min

M.Sc.

22

Process Development Manager Process Metallurgist

23/10/2009

41 min

M.Sc.

12

23/10/2009

41 min

M.Sc.

4

Position

Interview date

Interviews at LKAB Senior Researcher 24/09/2008 Department Manager 06/10/2008 Process Technology Process Technology 03/10/2008 Manager Coordinator 23/10/2008

Project Manager, Construction Project Manager, Construction Project Manager, Construction

Interviews at SSAB Chief Metallurgical Development Development Engineer Manager of R&D and Quality Project Manager, CI

3.3. Data analysis We started the data analysis by analyzing each case separately, thus compiling a case study history based on the interviews, field notes, observations, and secondary data (Yin, 1994). Each interview was transferred into a spreadsheet for further analysis. To facilitate the analysis, related questions were conceptually clustered together according to the general theme that they explored (Miles and Huberman, 1994). The main unit of analysis was the front end of process development, whereas the identification of tactics which increase speed and quality in the front end, at the firm level, constitutes an embedded unit of analysis (Yin, 1994).

Degree

Years of employment

1 h, 36 min 1 h, 12 min

M.Sc. Ph.D.

24 25

1 h, 58 min

M.Sc.

19

1 h, 31 min

18

13

03/10/2008

2 h, 02 min

Nonacademic training Ph.D.

23/09/2008

1 h, 38 min

M.Sc.

29

23/09/2008

1 h, 38 min

M.Sc.

17

01/10/2008

1 h, 18 min

M.Sc.

20

13/11/2008

1 h, 32 min

M.Sc.

4

13/11/2008

1 h, 04 min

M.Sc.

25

24/10/2008

1 h, 19 min

M.Sc.

3

2 h, 40 min

Ph.D.

9

1 h, 5 min

M.Sc.

21

1 h, 29 min 48 min

M.Sc. M.Sc.

11 8

¨ Interviews at Hogan¨ as AB Chief Metallurgist 10/10/2008 Officer 24/09/2009 Global Process Development Manager Plant Manager 10/10/2008 Development 28/09/2009 Engineer

success in the front end, i.e. which factors and activities were most critical to successful outcomes. Due to the exploratory nature of the research, the format of the interviews was adapted and changed slightly over the course of the data collection period, to pursue interesting and particularly relevant new facets as they emerged. All interviews were recorded, transcribed, and included in a case study protocol (Yin, 1994). The interviews ranged from 40 up to 160 min and were conducted over the course of approximately two years, from August 2008 to October 2009. To extend the insights from the interviews, informal discussions with managers and engineers were held and observations were made. In addition, we collected secondary data on documented procedures, annual reports, and other company information, thus allowing for empirical triangulation of the firms’ process development practices.

Duration

At this stage, data were coded and thematically organized around four main themes, which emerged and thus constituted our first-order (respondent) findings. The author team jointly decided on which codes to employ, based on an unprejudiced reading of the transcripts. Because we were interested in exploring rather than prejudging or ex-ante determining the front end of process development, we sought to let patterns emerge from the interview data. The first code addressed questions related to the definition and nature of the front end phase, whereas the second code dealt with activities done in the front end. The third code focused on managerial problems in the front end, and the fourth code addressed tactics for increasing speed and quality in the front end. Each transcript was first read and coded, and then the findings were summarized for each case. If a dimension was identified by a majority of our respondents, it became part of our first-order findings. When important information was missing, shorter telephone interviews were conducted at this stage to retrieve such missing information. We then performed a cross-case analysis, in which we compared the first-order findings in each case across the cases and looked for similar themes (Yin, 1994). The cross-case analysis was conducted after completing the data collection, so that we could replicate the cases against one another. As the first-order coding was descriptive, we made a second-order coding where we interpreted the descriptive data and compared the cases against each other and searched for causal links (Miles and Huberman, 1994). Thus, the empirical data was compared to the literature which constituted the conceptual set up of this article. Thus, the second-order coding process moved beyond the first-order

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findings. For example, as we conceptualized the front end and identified different sub-phases we related the key activities to these sub-phases. As in similar studies (Galunic and Eisenhardt, 2001; Smith et al., 2009), this analysis was a continuous process that required repeated reading of the interview files, the notes, the secondary data, and the theoretical framework. 3.4. Validity and reliability issues To strengthen internal validity, a clear research framework was designed and extensively discussed among the author team prior to the data collection process. We also used multiple theoretical perspectives that were evaluated when trying to explain and find counterarguments to the main theses in this article, drawing on literature from technology and innovation management, organization theory, product development, and operations management. Because the current study was conducted in a previously unexplored context, pattern matching was difficult. Consequently, internal validity could have been affected negatively (Denzin and Lincoln, 1994). Construct validity was addressed mainly by triangulation and by establishing a clear chain of evidence which would allow readers to see how the research questions matched with key conclusions (Yin, 1994). For example, secondary data on formalized work processes for process development were compared to insights from the interviews. On this basis, our multiple case study approach also strengthened external validity and helped to mitigate observer bias (Eisenhardt and Graebner, 2007). In order to limit potential biases in the data collection process, we selected highly knowledgeable respondents who had diverse perspectives concerning the front end in process development. To create overlap between data collection and data analysis, frequent discussions and preliminary analysis of emergent findings were shared among the authors of this article. To further increase reliability (transparency and future replication), a case study protocol was constructed together with a case study data base, containing case study notes, documents, and the narratives collected during the study, all with the aim of facilitating retrieval for future studies (Yin, 1994).

4. Empirical findings This section reports the results from the cross-case analysis, but some key information on each case is provided in addition. We organize our findings into three main sections. First, we conceptualize the front end in process development and describe the critical activities performed therein. We link activities to a conceptual model to provide a comprehensive overview of ‘‘what happens’’ in each specific sub-phase. Subsequently, an integrated perspective on the front end in process development is presented. Second, typical problems with front end practices in process development are highlighted. Finally, we elaborate the tactics that can increase speed and quality in the front end of process development. 4.1. The front end in process development Overall, the front end was pictured by respondents as complex yet critical to end results. In all firms, this phase involved both formal and informal activities. Common to all firms in our study was a systematic project model applicable to the early phases of process development. Although differences in details were spotted among the firms studied, the process basically consists of four sub-phases, which we label informal start-up, formal idea-study, formal pre-study, and formal pre-project. However,

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this model was not always applied to the front end projects that were pursued in the firms in our sample. Often, the model was more rigorously used for projects with higher degrees of novelty, such as those requiring major investments in new process technology, and less rigorously applied to incremental development projects. Below, the sub-phases of the front end are described in detail, and the activities which typically belong to each sub-phase are illustrated. 4.1.1. The informal start-up phase In the beginning of the front end, ideas for process development were often fuzzy and unclear, containing multiple loose ends. Therefore, a key activity in the start-up phase was idea generation and refinement. Typically, ideas either came from top management or middle management, or they originated among development personnel on their own initiatives without any explicit order. If the idea came from management and was in line with the firm’s manufacturing strategy, it was considered legitimated. Although a need for refinement was often spotted, the idea often moved quickly into a formal idea-study. If, on the other hand, the idea originated from development personnel, additional informal activities took place to gain legitimacy. These activities were typically performed outside the formal project model. Table 2 provides representative quotes from our interviews on key activities in this phase. Because process development efforts span from minor changes in work methods to significant investments in new process technology, ideas came from a variety of different sources. In principle, any person involved with the production process or with development in general could come up with ideas for new process development projects. Most of the ideas in all firms came from the production personnel, but ideas also originated in the R&D department, product development, or central process development departments. Although the triggers to new ideas were multiple, cost reductions and quality problems with existing products were the most common starting points. To further refine ideas, informal conversations with colleagues frequently took place, e.g. at coffee breaks. In addition, process development ideas were discussed and refined when persons from different functional departments gathered and discussed problems in the production process. Hence, the second key activity in the informal start-up phase was informal discussions. An idea which gained momentum and legitimacy among development personnel was subsequently explored in a formal idea study. 4.1.2. The formal idea-study The idea-study was pictured as the first ‘‘formal’’ phase of the front end, and it was typically initiated by a metallurgical or process development manager. At this stage, the idea was further specified and a clearer conception of the problem was enacted, to which the idea was thought to present the solution. Specifying the ideas was typically done by means of group discussions and/or by conducting a formal literature review, depending on the type of process innovation project carried out. For example, if the anticipated problem and the idea related to quality issues in the end product, the idea for a solution was often frequently discussed among process operators and development engineers. If the idea for the process development project instead came from senior management, thus implying a more long-term objective such as to evaluate future production processes, opportunities or constraints, then a formal literature review was complied. Table 3 provides representative quotes from our interviews on key activities in this phase. When the problem and the idea were sufficiently understood, they were typically extensively discussed in subsequent steps

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Table 2 Representative quotes referring to the informal start-up phase. Case

Representative quotes

Key activities

The informal start-up phase Boliden AB To generate ideas we do brain storming but we don’t do it often enough. There is a need to get better at generating novel ideas. (Manager Mining Technology) Boliden AB Sometimes we have brain storming sessions, but unfortunately it does not happen very often. (Technology Manager) ¨ ¨ Hogan as I start by collecting all ideas I can find in one field and then we have a meeting, where we sit together and think AB about what will be needed in the future. We discuss what type of production technologies we need in the future to develop new products. (Global Process Development Manager) SSAB I think we actually generate a lot of new ideas, but for that sake it does not mean that all new ideas become projects. Only the best ideas or the ones which are right at that time gets funding and eventually become a project. (Manager of R&D and Quality) SSAB To retrieve ideas, we arrange meetings with staff from R&D, operations and maintenance. Risk assessments, ‘‘yellow notes’’ and brain storming are the techniques we use. A large part of process development is initiated by some kind of problem, so we are indeed quite problem-driven in our approach. (Chief Metallurgical Development) Boliden AB Many new ideas surface around the coffee table. (Manager Process Technology)

‘‘Idea generation and refinement’’ ‘‘Idea generation and refinement’’ ‘‘Idea generation and refinement’’

‘‘Idea generation and refinement’’

‘‘Idea generation and refinement’’

‘‘Informal discussions’’

Table 3 Representative quotes referring to the formal idea-study phase. Case

Representative quotes

Key activities

The formal idea-study Boliden You start off by doing experiments in small scale, such as batch experiments. This is the typical beginning and I do some sort AB of literature study and batch experiments before I go up to bench experiments. (Manager Process Technology) Boliden Once you have an idea you start out by checking out the history and search for prior results in the literature. AB (Process Metallurgist) LKAB In the beginning, the normal routine is to get a good picture of the problem by performing a literature review and consulting knowledgeable persons within the specific field. (Manager Process Technology) SSAB You always analyze the situation to assess what it looks like before you get down to business. (Manager of R&D and Quality) Boliden When you impose process technology changes, one of the first things we do is to try to anticipate if there is a risk that we AB change the end product. The product and the production technologies are closely related and if we make a process change in production technologies it may affect the product even if we don’t spot these changes here at the plant. But it may very well surface later on in the production process, for example, when the powder is pressed. (Plant manager) Boliden It is critical to do some type of preliminary tests of the material early. (Chief Strategy Officer) AB LKAB Tests can be performed by means of computer simulation or by performing small scale experiments. Once we have the results we can start sketching on what an improved production process may look like. (Department Manager Process Technology) LKAB In the beginning we develop a number of alternative solutions. These are later reduced into one or a few interesting alternatives, and afterwards we calculate and assess the technical and financial potential for each remaining concept. The final alternative often includes a cost estimation with about a 7 10% deviation. (Project Manager, Construction) SSAB We have an idea of how to make things better or how to solve the problem at hand. Sometimes you have one solution but often there are multiple options. Based on that we suggest different approaches to fix the problem. (Chief Metallurgical Development) SSAB The process concept is fundamentally about clarifying what you want and how it can be achieved. Goals are set up that can center on quality, financial issues, or both types. The goals are critical and should always be a part of the concept. (Manager R&D and Quality) ¨ ¨ Hogan as Someone sketches the idea and background together with the project leader. It typically includes the intended goals, what AB the receiver needs and expects, and how the goals are about to be accomplished. Other criteria’s that are estimated are the time frame and required resources that are needed to realize the idea and concept. (Global Process Development Manager)

with other colleagues and, later on, with senior researchers within each respective firm. A key question asked in the idea study was whether the process change that was required would affect the properties of the final product and, if so, in what way. Thus, there was a strong interdependence between process development and product development. Because changes in the production process often affected the end product, the second key activity was the anticipation of end-product changes. Typically, the next key activities performed in the idea-study were to test and further validate the idea by means of small-scale trials. Preliminary tests in bench scale or preliminary laboratory tests were typically conducted at this stage. The idea-study was described as highly theoretical, meaning that most of the work was conceptual and prior research and knowledge were regarded as key inputs. Few practical tests were performed at this stage, and if tests occurred, they were

‘‘Literature review’’ ‘‘Literature review’’ ‘‘Literature review’’ ‘‘Literature review’’ ‘‘Anticipation of endproduct changes’’

‘‘Preliminary tests’’ (lab or bench tests) ‘‘Preliminary tests’’ (lab or bench tests) ‘‘Creation of a preliminary process concept’’ ‘‘Creation of a preliminary process concept’’ ‘‘Creation of a preliminary process concept’’ ‘‘Definition of project objectives’’

conducted in the small-scale laboratory setting. For incremental process development projects, this stage was often deemed to be of less importance. For more radical projects, implying more all-encompassing changes to the production process, this stage was considered paramount. Another key activity was the creation of a preliminary ‘‘process concept’’. Similar to the conception of a product concept, respondents envisioned this to include a set of functional specifications of the desired process objectives. The ‘‘output’’ of the idea study was typically a report describing the preliminary objectives for the project, together with a specification of the problem to be solved and the hypothesized gains to be reaped. Hence, the final key activity in the idea-study can be summarized as definition of project objectives. Finally, a decision to proceed or not to proceed to a pre-study was taken, typically by a process development department manager.

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4.1.3. The formal pre-study The idea-study served as the input material to the pre-study, which was further explored by doing more detailed, fine-graded, and rigorous empirical tests. The project idea was thus further specified. These specifications often triggered investments in or reconstruction of process equipment which would further enhance efficiency in the production processes. Questions such as what we should develop, how we should do it, and what are the costs and consequences of the proposed process change were typical in the beginning of the pre-study. Risk analyses of different types, e.g. internal and external environmental analysis, were a typical key activity in the pre-study phase. Questions such as how will the process changes affect the work environment and what external effects the proposed change may have on the environment outside the firm were critical, e.g. environmental pollution issues. Table 4 provides representative quotes from the interviews on key activities in this phase. In most cases, a project group with persons from different functional backgrounds was assigned to conduct the pre-study. A key task of the project group was to verify ideas by performing a series of experiments at several different scales. Hence, key activities performed in the pre-study were more fine-grained bench-scale tests, laboratory tests, and pilot plant tests. The type of tests that were performed depended on the type of process development project. Tests in the bench scale and laboratory had the smallest scale, and they were often conducted with the purpose of anticipating changes in the chemistry of the end product. Process engineers and researchers altered process parameters, e.g. temperature and pressure, to see whether preliminary goals for the project could be reached. Subsequently, the process was scaled up to some intermediate level and the appropriate level of key process parameters was selected. As more knowledge was gained about the effects and consequences of the planned process change, the preliminary objectives were often changed slightly, which created a need for iteration among key activities. For example, the results of experiments frequently improved the emerging process concept. Consequently, important project objectives were revised, and these revisions triggered new tests. The refinement of the preliminary process concept was therefore the last key activity in the pre-study, as the final evaluation of the process concept typically took place at the pre-project phase.

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4.1.4. The formal pre-project The concluding phase of the front end in process development was the pre-project phase, and Table 5 provides some representative quotes on key activities in this phase. In this phase, the first key activity was specification and selection of final process concept. If the project involved building or buying new process equipment, i.e. construction/modification of process equipment, prototypes of this equipment was tested and evaluated at this final phase. Full-scale experiments were another activity conducted to further verify the process change. The full-scale experiment was the most accurate estimation of all, as the idea was tested in the actual production environment. All other experiments such as bench-scale tests, laboratory tests and pilot plant tests involved many restrictions related to scaling problems. Moreover, a feasibility analysis and a project plan were viewed as key activities. By conducting a feasibility analysis, the current capabilities and requirements were explored as well as whether the proposed process change was in line with the firm’s overall strategy. In the project plan, resources, costs and a time plan were estimated for the overall development project. Based on the data analysis, Fig. 1 provides a visual representation of the front end stage of process development.

4.1.5. An integrated perspective on the front end in process development An important observation is that the activities performed within the front end in process development differ depending on the type of process development project that was pursued. Because of the divergence among different types of projects, it is somewhat difficult to present one general and all-encompassing model that would be applicable to all sorts of projects. Key activities performed differed both among and within the firms studied, and Fig. 1 thus represents an ideal type. In particular, our study allowed for identifying several key factors that influence firms’ management of front end activities. First, the degree of novelty of the process development project is a critical determinant of the activities in the front end. All else being equal, a higher degree of novelty made the project more complex and uncertain. Accordingly, higher novelty resulted not only in more activities, but also in longer time-frames for individual activities, e.g. to verify ideas and problems. For

Table 4 Representative quotes referring to the formal pre-study phase. Case

Representative quotes

The formal pre-study SSAB Key questions that are to be answered in the pre-study are ‘‘what to do’’ and ‘‘how to do it’’. (Chief Metallurgical Development) Boliden We really prefer to conduct some sort of lab test, even if we skip that sometimes just to move forward faster. AB Experiments bring down uncertainty and create a feeling of security. (Chief Strategy Officer). LKAB We should always start in small scale to validate our ideas thoroughly. We try to emulate the idea as far as possible before we enter the production line and conduct full-scale tests. (Senior Researcher) ¨ ¨ Hogan as Pilot tests and experiments in small scale are conducted early and we use our pilot equipment to get information on AB whether we are moving in the right direction. If we are able to conduct full-scale experiments, we do that as well, to anticipate the nature of scaling problems. (Global Process Development Manager) LKAB We are always doing some sort of risk analysis where several persons are involved and we try to figure out different obstacles that we must overcome. (Manager Process Technology) SSAB We do risk analysis at all stages of a project. We try to assess risks and opportunities, but not always in the traditional way. Sometimes risk analyses are done at later stages. It depends on the type of process change that we are performing, but we must always consider if the change can affect the end product in some way. (Chief Metallurgical Development) SSAB You have to have a frame that describes and sets the boundaries for the idea before starting. Risk analysis allows us to create that frame. (Development Engineer) SSAB When process concepts become clearer, we are often capable of delineating to one or two possible solutions. We then further estimate and sketch the problem to evaluate the concepts and get the basis for making a decision. (Chief Metallurgical Development)

Key activities

‘‘Definition of project objectives’’ ‘‘More fine-graded tests (lab or bench tests)’’ ‘‘More fine-graded tests (lab or bench tests)’’ ‘‘Pilot plant test’’

‘‘Risk analysis’’ ‘‘Risk analysis’’

‘‘Risk analysis’’ ‘‘Refinement of preliminary process concept’’

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Table 5 Representative quotes referring to the formal pre-project phase. Case

Representative quotes

Key activities

The formal pre-project Boliden We often have several feasible concepts and I think that we have to have some kind of formal screening process towards the AB end. Of course, we look thoroughly at what can be accomplished in the existing production process and how much resources the development efforts require. (Senior Metallurgist) SSAB It depends on what type of process development that is being conducted. When it comes to larger changes, new process equipment is often a necessary component. In other cases, the existing production equipment can be modified or just operated differently. (Development Engineer) ¨ ¨ Hogan as We test our idea and concept directly in the production line but sometimes when the uncertainty of the effects is significant AB we utilize a smaller pilot plant and conduct our experiments there before we enter the real production line. (Development Engineer) ¨ ¨ Hogan as We have a check list and one of the items on that list is feasibility commitment. The idea here is that we should estimate AB whether we are able to conduct the suggested change, whether we can do it, whether we have the financial resources to do it. I think that this is one of the most important things on the list. (Global Process Development Manager) SSAB In the pre-project phase we focus on financial issues and we are deep into detailed solutions because detailed solutions are important to make a good estimation of the costs. After this is done the actual project starts. (Chief Metallurgical Development)

FORMAL IDEA-STUDY INFORMAL START-UP Idea generation and refinement Informal discussions

FORMAL PRE-STUDY

Literature review Anticipation of end-product changes

‘‘Specification and selection of final process concept’’ ‘‘Construction/modification of process equipment’’ ‘‘Full-scale tests’’

‘‘Feasibility analysis’’

‘‘Project planning’’

FORMAL PRE-PROJECT

More fine-graded bench tests

Specification and selection of final process concept

Laboratory test

Construction/ modification of process equipment

Preliminary bench tests

Pilot plant tests

Preliminary laboratory test

Risk analysis

Creation of a preliminary process concept

Refinement of preliminary process concept

Full-scale test Feasibility analysis Project planning

Definition of project objectives

Go/No go decision

Time

Fig. 1. The front end stage of process development.

example, if the process change implied radical changes, such as the introduction of the next-generation production process, it strongly affected not only the number of activities performed but also the rigor of execution. Second, a firm’s prior expertise about the current problem strongly affected the project design and outcome of the front end. If the firm had prior knowledge of a given problem, the idea-study was often skipped and the process engineers started directly by doing experiments. For example, in cases concerning minor process changes, the process engineers already had the required knowledge to solve the problem up front, which meant that activities involving acquiring relevant knowledge could be skipped. On the other hand, if the problem was novel and knowledge was lacking, then a key activity was to acquire solid information about the anticipated problem through a thorough literature review and small-scale experiments. Third, the source of the process change was deemed critical. Long-term oriented process development projects typically came from senior management, and they required a more formalized structure. In comparison, more short-term oriented projects initiated at lower levels were often conducted informally, often with the characteristics of ‘‘skunk-work’’. For example, if a project proposal was ordered by senior management, activities were

typically performed in a more formal and proficient way. Literature reviews and documentation were examples of activities which varied in conduct depending on the source of the process change. Fourth, the time-frame for the project was another key issue. Front end projects were often given an approximate time-frame at the outset, which greatly affected the conduct of key activities. Under conditions of a short time-frame, some activities were often skipped or performed in an ad-hoc manner to keep the project on time. Typically, a complete literature review, documentation of experiments, and exact anticipation of the process concept often suffered in projects with shorter time-frames. Finally, process development projects often had a center of gravity in either technical or organizational change. Although most projects spanned the technology/organization interface (e.g. the installation of new process equipment which requires new routines and work practices on the part of labor), the center of gravity affected which project activities were conducted. In particular, technical changes were rarely effective without being accompanied by organizational changes. For example, if the process change implied investments in new process technology, technology assessment was critical. Despite a particular center of gravity, most projects with a substantial degree of novelty

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therefore involved technical and organizational changes. If the process development efforts only implied the establishment of new work methods, however, the integration of operating personnel was a key activity. 4.2. Key problems at the front end of process development Several key problems and deficiencies in front end projects emerged from analyzing the data. While some of these challenges were common to all firms studied, others were firm-specific. A key problem shared by all firms, which also constitutes a paradox, was early production involvement. In all firms studied, the production department was the main source of process development ideas. While this ensured that new projects were relevant, it also favored incremental adjustment of existing operations and processes at the expense of more radical ones. Thus, most projects addressed the daily problems in the production process whereas projects of high future importance often were difficult to pursue. The focus on incremental adjustments depended mainly on the restriction of new investments and the fact that current production problems were typically prioritized at the expense of future-oriented ideas. This problem was reinforced when production plants were costcenters and plant managers prioritized among different ideas, thus delimiting the influence of central process development departments, who often were the sources of more radical ideas. In general, however, it was striking to see how much emphasis all firms in the sample place on relatively incremental adjustments over more radical process advances. Second, on a related note, most front end projects in process development were reactive, implying that process engineers mainly worked with existing and acute problems in the production plants. A regular analogy of the work performed by the process engineers was made to the work performed by a fire brigade. This analogy typically demonstrates that process development is mainly reactive (i.e. to put out existing fires) rather than proactive (i.e. to plan ahead and prepare for future challenges). According, besides relatively incremental changes, many front end efforts were initiated in an ad-hoc, emergent way rather than following some formal process planning. A third common problem shared by all firms was the lack of time and resources to conduct process development projects. The reactive nature of process development made it difficult to plan ahead and to estimate the appropriate time and resources to conduct process development. Consequently, the evaluation of experiments and calculations in the front end were sometimes based on personal judgments and gut feeling rather than on acquired facts which further illustrates the emergent approach to process development. Finally, the documentation of results was a general problem within all firms. Especially, failed experiments were seldom documented, resulting in similar mistakes being repeated several times. 4.3. Tactics for increasing speed and quality in the front end of process development The respondents in our cases listed early involvement of production staff, cross-functional collaboration, and a creative culture as the key aspects to support activities in the front end. Table 6 contains illustrative quotes for each tactic. Early production involvement was judged decisive for a proficient front end. Frequent and close communication with operating personnel provided a clearer understanding of the current production problems and could provide insights about future challenges. Inviting the operating personnel to participate in the front end was an alternative way to gain direct access to critical knowledge of the production process, and it was also

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believed to reduce the resistance to change, which thus facilitates the subsequent implementation of the process development project. Moreover, cross-functional collaboration was further stressed as critical to achieve enhanced performance in the front end. The systemic nature of process development implies that a number of different functions and departments within the firm should be involved in the design and implementation of process development work, which calls for close collaboration among functions and departments. Furthermore, the systemic nature of process development made it critical to integrate technical choices with operating conditions, because process performance is affected by interactions among actual operating conditions, technical choices and capabilities of the future production process. The process engineers thus needed to collaborate with several different functional groups, e.g. operating personnel and product engineers. To facilitate cross-functional collaboration, frequent meetings and common goals were deemed important. Finally, a creative culture was considered to be critical to enhance performance in the front end. A creative culture, according to the respondents, involved freedom, playfulness, tolerance for individual differences among employees, and trust and empowerment on the part of management. According to the respondents, to create a creative culture involved addressing all of the above aspects as well as enabling slack time and resources, which encouraged the employees to pursue informal discussions, tests, and experiments to evaluate emerging ideas for process development.

5. Discussion and implications Despite the positive effects of process development on manufacturing performance (Reichstein and Salter, 2006) and overall firm performance (Gopalakrishnan et al., 1999; Utterback and Abernathy, 1975), knowledge about the process development activities that precede formal projects has remained scarce. To a background where the technology and innovation management literature has established these activities as critical to success in product development (Cooper et al., 2004; Verworn, 2009), the absence of studies in the process domain is somewhat surprising. Previous scholars have pointed out the need for additional research into the front end in process development (Lager, 2000; Lim et al., 2006; Pisano, 1996) but such studies have not yet been available. Our research has helped to close this knowledge gap. While our results show some similarities to front end activities in product development, they stress that extant knowledge on the front end in product development cannot be directly transferred to the process domain because of differences in key characteristics. Table 7 displays some of these differences. As front end activities are critical to ultimate success in process development (Pisano, 1996), our study deepens the understanding of the front end in a previously unexplored context. These findings are particularly relevant in light of the desire of both managers and academics to better understand the activities, issues, and managerial challenges needed to enhance proficiency in process development (Hatch and Mowery, 1998; Khazanchi et al., 2007; Reichstein and Salter, 2006). 5.1. Theoretical implications Our empirical study has important implications for research into process development, new product development, and production management. First, regarding process development research, our study provides new insights into the ‘‘process

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Table 6 Key quotes on tactics for increasing speed and quality in the front end of process development. Tactics for increasing speed and quality in the front end

Case

Representative quotes

Early production involvement

Boliden AB

I would say that early production involvement is one of the most critical things. The best solution is to make them believe that the new ideas and concepts are their own inventions. (Senior Metallurgist) We work with involving the production department early in any project so that they are interested in taking over the project in subsequent steps. (Coordinator) It is important to involve persons from the operation early. They should be part of the decision-process and not only there to receive information. The idea is that you report the status to all operators and then select participants among those that are interested and wants to participate. (Development Engineer) We, at the R&D department, have learned that we have to involve the plant manager in the front end, otherwise there will always be severe problems later on. Involving the operators rather early is also critical for the subsequent implementation of process changes. It does not matter how good ideas we have at the R&D department, if the operators don’t like them there will be no changes what-so-ever. (Chief Metallurgical Development)

LKAB SSAB

SSAB

Cross-functional collaboration

Boliden AB

LKAB

SSAB

Creative culture

Boliden AB

LKAB

SSAB

I believe that the composition of a group is essential. The right composition gives a lot of energy to every group. We did well in project X and the reason for that was that we involved operators, supervisors and other persons from different disciplines. It is very important to collect comments and references from different functions. (Senior Metallurgist) Cross-functional collaboration almost has the same benefits as collaboration with external partners. When you generate ideas and concepts together, these are generally better and it is easier to sort out bad ideas. (Manager Process Technology) Cross-functional collaboration is essential in order to get a feeling for the whole process. So that you know that the changes you make will affect the sections both before and after your own section in the process. (Project Manager Continuous Improvements) We have to build a culture where it is accepted to pose questions and divergent opinions. A creative organization culture, relaxing surroundings and time to think are all very important and a development team should not be controlled by the production department. (Manager Mining Technology) It is important to create a creative group or that the job involves some freedom where the person can take the time to generate ideas. Another thing that is important is that you can be a ‘‘loose horse’’, otherwise I think that you kill creativity. Being creative in the small things drowns if we should formalize everything. (Senior Metallurgist) It is important to have an open environment and to actually take advantages of people’s knowledge. (Project Manager, Construction) It is necessary to have a great understanding for people who are creative and you have to allow them to be creative and not to turn them down by saying that this is what we always have done previously. We must lift the ceiling for this type of visionaries. Far from all people are creative people so we must take advantage of those that are. (Senior Researcher) It has to be fun in the beginning. I think that to write down and think of all things that can go wrong feels like a later phase. I prefer to focus on ideas and opportunities in the beginning of any project. (Chief Metallurgical Development) One can come up with a lot of great things by performing different experiments and then write a report on it, but the hard part is to change the work methods and routines that we have established over the last twenty years. (Development Engineer)

Table 7 A comparison between the front end in product development and process development. The front end in product development Start of the front end phase Subsequent phase in the innovation process Key output Typical problems Key activities

The front end in process development

‘‘Opportunity-driven’’; an idea for a new product

Often ‘‘problem-driven’’; an idea for changing or modifying production processes Formal development (some type of stage-gate process) Typically implementation of process change/process concept into existing manufacturing processes A product concept A ‘‘process concept’’ Technical and market uncertainty, equivocality, ad-hoc decision Reactive nature of process development work, ad-hoc documentation of making, conflicting organizational pressures tests, early production involvement Market analysis, evaluation of competitive situation, product Tests and experiments in various forms, anticipation of end-product and portfolio strategy considerations changes, construction/modification of process equipment

development process’’. In particular, we present a descriptive framework of the front end in process development and identify the key activities which constitute this phase. Our findings thus extend those of previous scholars (Lager, 2000; Lim et al., 2006; Pisano, 1996) by addressing in detail what constitutes the front end in process development. These findings are important because existing models of the process development process are relatively abstract and lack sufficient details of what actually happens in the early phases, which appear critical for success. By presenting this descriptive framework, an important step is taken to increase the understanding of how process development efficiency is ultimately enabled.

Specifically, we have found that the front end in process development typically consists of four different sub-phases. These were labeled informal start-up, formal idea-study, formal prestudy, and formal pre-project. To our knowledge, none of these sub-phases have been reported in the literature on process development before, but similar models prevail in the literature on the front end in product development (Khurana and Rosenthal, 1997, 1998). Further, our study deepens the understanding of the key activities that take place throughout the various sub-phases of the front end. Some of the activities performed are equivalent to the ones conducted in the front end of product development, such as idea generation, development of a product/process

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concept, definition of project goals and project planning (Khurana and Rosenthal, 1998; Seidel, 2007; Griffith-Hemans and Grover, 2006). In contrast, other critical activities such as anticipation of end-product changes and construction/modification of process equipment have not been reported previously. Thus, our study provides important new insights into the critical activities within the front end in process development. In addition, we present empirical evidence of managerial problems in the front end of process development. Our study has shown that the reactive nature of process development, ad-hoc documentation of tests, and early production involvement are typical problems. These problems have not been reported in the extant literature on the front end in product development, while problems such as a lack of time and resources have been reported previously (Khurana and Rosenthal, 1998). Accordingly, our study contributes to a clearer picture of the managerial challenges of process development activities. Moreover, we have identified several factors that impact the organization of front end activities in process development. In particular, these factors were the degree of novelty, state of existing knowledge, sources of ideas to process development, scope of the process development project, and center of gravity of the process development project. According to these factors, the front end in process development may vary substantially. Consistent with contingency theory (Perrow, 1970), our findings suggest that there is no single best way to organize the front end in process development. Rather, these factors should be considered before structuring the front end. Consequently, the front end in process development looks different with respect to which activities are performed and prioritized. Accordingly, researchers should not oversimplify the organization of the relevant tasks because the organization depends on the specific situation and on the internal and external environment of the process development project. Our analyses additionally revealed that both informal and formal activities are present in the front end of process development, and that many incremental process development projects are conducted without starting a formal project, whereas in the cases of more radical process development the front end tends to be relatively formalized. Thus, our results contrast with product development research on the front end, and they suggest that incremental product development is more formalized than radical product development (Khurana and Rosenthal, 1997; Reid and de Brentani, 2004). This appears to be an important difference between the front end in process and product development. This finding calls for breaking new ground because any attempts to transfer knowledge from product development research to process development seem to be questionable with regard to the formalization of the front end activities. Accordingly, this issue needs to be highlighted as a particularly fruitful avenue for further research. Second, regarding new product development research, we have identified important interdependences between process development and product development. These interdependences have received little attention in prior research, but our study indicates that process development practices may be essential to achieve high product development performance. Accordingly, our findings suggest that product and process development are complementary, i.e., more of any one of them increases the returns to the other (Ennen and Richter, 2010; Lichtenthaler, 2009). Complementarity theory helps explain the super-additive value of resource configurations in firms (Milgrom and Roberts, 1995; Song et al., 2005). Consistent with this theory, our findings suggest that strong process development enhances a firm’s benefits from product development. As product and process development are interlinked in a firm’s overall innovation

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activities, changes in the process most likely affect the end product (Barnett and Clark, 1996) and this makes it important to anticipate changes in the end product as early as possible. Third, concerning research into production management, our study has highlighted the important role of production management in the early phases of a firm’s process development activities. Early production involvement is described as one critical tactic for increasing speed and quality in the front end of process development. At the same time, early production involvement is difficult to implement, which makes it a major problem. Thus, our findings suggest that early production involvement constitutes a paradox which needs to be better understood. Poole and van de Ven (1989) argued that addressing socialscientific paradoxes could further advance management practice as well as organization theory, because paradoxes are about tensions and oppositions between incompatible positions of real-world activities, which are subject to temporal and spatial constraints. Therefore, the paradox of early production involvement that we have identified in this study suggests that future research should pay particular attention to how the benefits of such integration may be reaped, while at the same time the risks may be avoided. In light of the extant process development literature, our findings suggest that the role of the production department in process development has been acknowledged insufficiently (Linton and Walsh, 2004). While earlier work has pointed out the importance of production management for product development, our findings emphasize its key role in process development. Beyond the importance of integrating production management in the later phases of the product development process, our interviews have underscored the need for integrating production management expertise from the very beginning of the ‘‘process development process’’ (Nihtila, 1999). The production department plays a particularly critical role in process development, and its early integration helps to strengthen the development, implementation, and acceptance of new process solutions in firms. 5.2. Managerial implications Our study provides direct managerial implications for enhancing the success of front end activities in process development and, consequently, for improving the overall process development process. Above all, our findings clarify which activities need to be addressed in the front end in process development. These results provide implications relevant to top managers, project managers, plant managers, and development engineers of process development projects. In essence, we present a template for how the front end can be structured and managed. Managers can thus not only control the conduct of formal activities, but also encourage the more informal ones in order to enhance the performance in the front end. In particular, the front end is a relatively unclear and ill-defined phase, and it comprises substantial ad-hoc decisionmaking (Chang et al., 2007). To some extent, these problems are difficult to avoid because of the inherently fuzzy nature of this initial phase of process development. Despite this fuzziness, however, there are some specific recommendations for managers which will most likely contribute to enhancing a firm’s front end in process development. The findings of our study further reveal other problems in the front end of process development, such as low levels of innovativeness due to early production involvement, a lack of time and resources, ad-hoc documentation of tests, and that most process development efforts were reactive rather than proactive. Many of these problems could, arguably, be diminished through a more formalized work process.

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Accordingly, our findings imply a call for routines in the front end of process development. A formalized work process is explicit, widely known, and characterized by clear decisionmaking responsibilities (Khurana and Rosenthal, 1998). On this basis, managers may reduce the uncertainty and equivocality among organizational participants. While it will be impossible to reduce all fuzziness from the front end, a stronger formalization appears to be beneficial for all process development projects that we have studied. More formalization in the front end will most likely help firms to reap the benefits from organizational routines in process development. Thus, managers should not be afraid of an excessive formalization of the front end activities which is highly unlikely at the current state of managing the front end of process development in most firms. Moreover, early production involvement was considered a critical driver of improving a firm’s performance in the front end. By involving the production experts early, important knowledge is acquired and the process concept can be refined in more detail. Early production involvement further reduces resistance to change. Moreover, it ensures that the process change will be implemented in production, which leads to more efficient overall process development. While management clearly can reinforce early production involvement, particular emphasis needs to be paid to the need for innovation despite early production involvement, because otherwise early production involvement may result in low levels of innovativeness. Beyond the importance of the production department, crossfunctional collaboration is important to increase both speed and quality in the front end of process development. In particular, cross-functional collaboration is critical to facilitate efficient product and process development and sufficient alignment between product development and process development (Pearce and Ensley, 2004). In the front end, the involvement of persons from different functions and backgrounds helps define the objectives and requirements of the new process change before excessive resources are invested. A shared vision of the process concept further facilitates mutual understanding among the functional groups performing specialized roles in the front end, and it reduces resistance to change. Accordingly, managers need to pay particular attention to the cross-functional activities and the functional interfaces in the front end of process development. Finally, an entrepreneurial organizational culture provides another foundation for success in the front end in process development. In particular, an entrepreneurial culture allows employees to test their ideas and to conduct experiments in small scale without excessive bureaucracy. Moreover, trust, freedom, and playfulness tend to play important roles in entrepreneurial cultures, and these aspects constitute important components to ¨ et al., 2009; actively establish a creative culture in firms (Akgun Pearce and Ensley, 2004). Managers thus need to trust employees and reinforce good relationships among managers and employees to foster a creative culture. Clearly, management can encourage and reinforce such cultural norms over time (Khazanchi et al., 2007; Pagell and LePine, 2002).

activities need to be validated against other cases and methods. Another limitation is the sole focus on continuous processes. Thus, an important suggestion for future research is to investigate the front end in other types of processes, e.g. job shop processes, batch processes, and flow processes. In addition, retrospective sense-making is always an issue to consider when dealing with qualitative interview data. There is thus a risk of relying on retrospective interviews, as respondents can forget and misinterpret important facts (Eisenhardt and Graebner, 2007). On this basis, the front end in process development would clearly benefit from additional research. First, it would be beneficial if the results emerging from this study were fine-tuned and tested in other cases with different conditions (i.e. polar cases), to test whether the results hold. A second avenue is to extend the framework to other industries such as assembled consumer products. A critical question is whether the same components and activities of the front end in process development are relevant for consumer products. A third avenue is to test the current results in a wider sample of multiple industrial domains. Thus, there is a need for large-scale empirical efforts, which may contribute to further deepening our understanding of the front end in process development. Specifically, we encourage mixed-methods studies, which combine qualitative and quantitative data collection. This type of studies may be an essential direction for future work because it enables researchers to gain a thorough understanding while still providing quantitative evidence of complex phenomena, such as the front end in process firms. As much remains to be explored, there are great opportunities for further research into process development, especially concerning the role of front end activities. In particular, additional case studies and quantitative analyses may provide results that are equally relevant to academics and practitioners.

Acknowledgements The authors acknowledge the valuable input by key informants participating in this study, as well as financial support by Swedish Governmental Agency Vinnova and the participating companies. The authors are also grateful to Editor Jonathan Linton and two anonymous reviewers for their helpful comments on drafts of this article.

Appendix A. Interview questions on managing and organizing the fuzzy front end in process development Background information 1. What is your formal position within the firm? 2. What are the main activities that you work with and what is your area of responsibility? 3. What are your previous work experience and education, and how long have you been working for your current employer?

5.3. Limitations and further research General questions about process development Some key limitations associated with this study are worth mentioning. First, the findings in this study are based on an in-depth study of four firms, all active within the metal and minerals industry. While sampling cases within one single industry strengthens external validity, it still delimits generalizability outside this context (Yin, 1994). As such, the firms in our study may have idiosyncratic characteristics and, therefore, the suggested conceptualization of the front end and the identified

4. How do you define process development and what activities constitute process development? 5. What is the definition of process development at your firm? 6. What is the amount of time that you work with process development? 7. What are the main objectives/purposes of process development at your firm?

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8. What is the overall mindset at the firm concerning process development? 9. How is process development organized at your firm? 10. What do the stages of process development look like, i.e. when are things done and in what order? 11. Does your firm have a formal process development work process or method? 12. How are activities coordinated, which span over functional interfaces and departments? 13. Do you have a holistic view of process development at your firm? 14. Can you describe how product development and process development interact? 15. Do process development and product development have the same status at your firm? 16. Do new products drive new processes or is it the other way around, i.e. is it process development that enables development of new products? Questions of the fuzzy front end in process development 17. What is your experience of fuzzy front end activities in process development? 18. Who has ideas for new process development projects and where do the ideas come from? 19. How does your firm screen new ideas for process development projects? 20. How does your firm choose which ideas eventually will be developed into formal projects? 21. Against which criteria are ideas evaluated? 22. How does your firm balance and mix new ideas for process development projects? 23. How are ideas realized in the context of production? That is, what do you do to implement the ideas in the context of production? 24. What does your firm do to make the ideas work in practice? 25. How is the ‘‘fuzzy front end stage’’ structured/organized at your firm? 26. Who is involved in the early phases of process development at your firm? 27. How does the work in the early stage of process development operate in practice at your firm? 28. What are the problems, conflicts, and solutions? What is working well or, perhaps, not so well? 29. What is the most important thing that will make your firm succeed with the early stage in process development? 30. What do you need to change—if you were allowed to wish freely? 31. What are the obstacles in the early stage in process development? Questions on what drives success in the fuzzy front end of process development 32. What are the critical factors and activities that will make you succeed with the front end? 33. Please explain, based on your previous experience, how to make FFE activities work in practice? 34. Can you explain how the different activities and factors that you elaborated on previously are related to each other, and what firms can do to link the individual factors into a coherent whole? Start with the factor that you deemed most important and elaborate on how it is related to the other factors that you judge as important. 35. Can you tell us, in general terms, how a process concept is developed?

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Monika Kurkkio is an Assistant Professor of Accounting and Control at Lulea˚ University of Technology, Sweden, and a Member of the Promote Research group http:// promote.ltu.se. She holds a Ph.D. in Business Administration and has authored in journals such as the European Journal of Innovation Management and International Journal of Technology Intelligence and Planning. Her current research interests include the fuzzy front end in product and process development, R&D management in process firms, and external accounting and finance.

Johan Frishammar is a Professor of Industrial Management at Lulea˚ University of Technology, Sweden, and Centre Director for the Promote research group (http://Promote.ltu. se). He has authored or co-authored in the California Management Review, Journal of Product Innovation Management, IEEE Transactions on Engineering Management, International Studies of Management and Organization, Technological Forecasting & Social Change, Technology Analysis & Strategic Management, International Journal of Technology Management, and other journals. Current research interests include inbound and outbound open innovation, management of the fuzzy front end, and R&D management in process firms.

Ulrich Lichtenthaler is a Professor at the University of Mannheim, Germany, where he holds the Chair of Management and Organization. He received his Ph.D. from WHU—Otto Beisheim School of Management, Germany, and he recently was a visiting scholar at the Kellogg School of Management, Northwestern University, Evanston, US, and at Lulea˚ University of Technology, Sweden. His current research interests include absorptive and desorptive capacity, dynamic capabilities, open innovation, technology licensing, and interorganizational alliances. He has published in leading journals, such as Academy of Management Journal, California Management Review, Journal of Business Venturing, Journal of Management Studies, Journal of Product Innovation Management, MIT Sloan Management Review, Organization Science, Organization Studies, Research Policy, R&D Management, Strategic Management Journal, Strategic Organization, and others.