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Costing commonality : evaluating the impact of platform divergence on internal investment returns

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dc.contributor.advisor Edward F. Crawley. en_US Cameron, Bruce G. (Bruce Gregory) en_US
dc.contributor.other Massachusetts Institute of Technology. Engineering Systems Division. en_US 2012-01-12T19:33:32Z 2012-01-12T19:33:32Z 2011 en_US 2011 en_US
dc.description Thesis (Ph. D.)--Massachusetts Institute of Technology, Engineering Systems Division, 2011. en_US
dc.description Cataloged from PDF version of thesis. en_US
dc.description Includes bibliographical references (p. 248-253). en_US
dc.description.abstract Platforming has become an important means of cost-sharing among industrial products. However, recent research has shown that many firms face systemic downward pressure on commonality, with the result that many platforms realize less commonality than intended. This research was chartered to evaluate the costing of commonality benefits, the associated returns from commonality investments, and the potential impact of divergence on commonality benefits. This dissertation used a tiered approach to the research questions. A statistical study of commonality returns was conducted, finding evidence for a potential link between divergence and cost growth. Broad practice surveys of 16 firms revealed cost allocation practices and internal funding strategies as potential determinants of the commonality-cost relationships. Three detailed case studies were conducted to trace benefit trajectories through platformed products in the presence of commonality changes. We find support for the hypothesis that divergence has cost consequences, notably reducing inventory benefits, creating higher quality expenses and requiring additional manufacturing coordination. Additionally, we show that lead variants bearing platform costs achieved weaker investment returns and re-captured few benefits from later variants. We find also find evidence to refute the notion that representation at design reviews ensures downstream benefits are represented. Several management practices for making commonality decisions are identified. We propose a framework for commonality cost decisions, which explicitly captures the impact of individual variant decisions on the platform's cost structure. We identify a commonality cycle, a progression of commonality strategies seen by firms, driven by growing benefit analogies among platforms enabling larger investments, premature investment evaluation, and unrealized returns on commonality investments. en_US
dc.description.statementofresponsibility by Bruce G. Cameron. en_US
dc.format.extent 253 p. en_US
dc.language.iso eng en_US
dc.publisher Massachusetts Institute of Technology en_US
dc.rights M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission. en_US
dc.rights.uri en_US
dc.subject Engineering Systems Division. en_US
dc.title Costing commonality : evaluating the impact of platform divergence on internal investment returns en_US
dc.title.alternative Evaluating the impact of platform divergence on internal investment returns en_US
dc.type Thesis en_US Ph.D. en_US
dc.contributor.department Massachusetts Institute of Technology. Engineering Systems Division. en_US
dc.identifier.oclc 770698388 en_US

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