A comparison of the integration of Risk management Principles in Product Development Approaches

Abstract

The management and reduction of risk is a central part of product development processes. This paper analyses the extent to which four common product development approaches address risks (waterfall model, stage gate model, design for six sigma, and lean product development). They are analyzed along the four principles of risk-driven design: 1. Identifying and quantifying risks; 2. Making risk-based decisions; 3. Reducing risks; and 4. Creating resilient PD systems. The analysis shows that the existing PD processes only partially address the four principles of risk-driven design and that they have their specific strengths and weaknesses. The paper concludes with a discussion of preliminary empirical findings through interviews and case studies on how to better integrate risk management principles into product development.