Does product platforming pay off?

Marc H Meyer* (Corresponding Author), Oleksiy Osiyevskyy, Dirk Libaers, Marcel Van Hugten

*Corresponding author for this work

Research output: Contribution to journalArticle

11 Citations (Scopus)
1 Downloads (Pure)

Abstract

Product platforming—a specific approach to new product development utilizing common technology components or subsystems deployed across multiple products or product lines—has been argued to bring numerous valuable organizational outcomes (e.g., effectiveness of R&D process, superior postlaunch product commercial performance, and ultimately sustained competitive advantage). Yet, large-scale longitudinal empirical examinations of the mechanisms linking product platforming to firm performance are scarce. Drawing on the concepts of architectural leverage and product life cycle flexibility, the article presents the development and empirical test of a set of hypotheses regarding the commercial outcomes of platforming at the product level using a unique dataset comprising all products developed and sold by a large, global LED lighting manufacturer in 2010–2015. The results suggest that platformed products demonstrate significantly higher sales and gross profit margins aggregated over their product life cycle (PLC), vis-a-vis the comparable group of nonplatformed, individually developed products. In addition, the findings demonstrate that a product platforming development approach appears to extend the PLC relative to nonplatformed products based on an integral, nonmodular product architecture.
Original languageEnglish
Pages (from-to)66-87
Number of pages22
JournalJournal of Product Innovation Management
Volume35
Issue number1
Early online date29 Mar 2017
DOIs
Publication statusPublished - Jan 2018

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