Managing modular product design: Critical factors and a managerial guide

Modular product design is commonly adopted by global manufacturers to accelerate product innovation. Many researchers have explored the importance of modular product design, its design methods and its effects on product performance. However, a few empirical studies explicitly examine how to coordinate modular product design in a managerial way. This paper addresses this issue by conducting multiple case studies with six companies that have successfully adopted modular product design for five years in Hong Kong and the Pearl River Delta, China. Seven critical factors are explored in the management of modular product design. These are: pre-defined product advantage, selectively used design rules, module definition, system integration, technological newness, internal communication, and supplier and customer involvement. The results compile a managerial guide for product development managers. While a majority of modular design literature studies the technical side of modular design within a firm, this study focuses on the managerial side across the supply chain. It gives new insights on how to manage modular product design and proposes future research opportunities.