The Parallel Connecting New Product Development Process of the Bicycle Industry in Taiwan

1. The Parallel Connecting New Product Development Process of the Bicycle Industry in Taiwan Stephen D.H Tsai  National Sun Yat-Sen University Yung Chie Chang  South Taiwan University of Technology Yi Hsien Wu  National Sun Yat-Sen University

2. The Parallel Connecting New Product Development Process • The Background • The Question • The Methodology • The “Parallel Connecting New Product Development Process” of the Bicycle Industry in Taiwan • The characteristics of the ”Parallel Connecting New Product Development Process” • Conclusion and discussion

3. 1.The Background Figure 1. The historical comparison of exporting volume and exporting value of Taiwan’s bicycle industry Sources：Taiwan bicycle industry R&D center，http://www.tbnet.org.tw

4. 1.The Background Figure 2. The comparison of the unit export price between Taiwan and Japan Sources：Taiwan bicycle industry R&D center，http://www.tbnet.org.tw；Japan Bicycle Promotion Institute，http://www.jbpi.or.jp/

5. 2.The Question • There are three characteristics of Taiwan’s bicycle industry • It is featured by the form of original equipment manufacturing（OEM） production（table1） • Although it has complete structure and is featured by professional division clearly（table2）, it relies on the key components from Japan deeply. • Most of its members belong to the SMEs（table3） • It is not an easy work to integrate the R&D work of 2,000 components and get more excellent achievements than Japan in export value and unit export price under the reliance of key components from Japan. • How can the SMEs of Taiwan’s bicycle industry make progress in their ability to develop the high additional-value product under the constraints of limited R&D capacity？

6. 4.The “Parallel Connecting New Product Development Process”of the Bicycle Industry in Taiwan • The perspective: • new product development is a kind of process to transform information • “Parallel Connecting New Product Development Process” (1) The process of substantiating creativity A. Foreign buyers corporate with assemblers and components suppliers respectively B. Foreign buyers skip over assemblers to procure new components directly (2) The process of revising • The reason to parallel connect

7. Component suppliers Foreign buyers Assemblers Foreign Buyers Assemblers Components Suppliers Bicycle blue print Components blue print Complete bicycle Components Figure3. The 「vertical connecting」cooperation mode of new product development ( 6 ) （1） （2） （3）（3）（5） （1）: the new ideas of frames （4） （2）: the new ideas of components （3）: the in formation of new components （4）: the order of new components （5）: the new components （6）: the complete bicycles Figure4. The 「parallel connecting」cooperation mode of new product development

8. Component suppliers Foreign buyers Assemblers Assemblers Foreign Buyers Components suppliers Revising information Revising information Revised bicycle Revised components Figure5. The 「vertical connecting」cooperation mode of revising （4） （3） （1） （2） （1）: the revising information of components （2）: the order of new components （3）: the new components （4）: the revised complete bicycles Figure6. The「parallel connecting」cooperation mode of revising new components

9. The reason to parallel connect The subjective conditions • The interpretative management of foreign buyers • The self-profiting incentives of components producers The objective conditions • The modularity of global bicycle industry • The established R&D capacity of Taiwan’s components producers

10. Dimensions Vertical connecting Parallel connecting The mode of new product development process Linear and sequential Parallel and simultaneous The number of hierarchies in communication for revising More Less The diversity of new product Low High The evolution of creativity Convergent Divergent 5.The characteristics of the ”Parallel Connecting New Product Development Process Table5、A comparison of 「parallel connecting」and 「vertical connecting」cooperation mode

11. 6.Conclusion • Parallel connecting cooperation mode which can successfully parallel connect industrial members to offer flexible and quick R&D services for foreign buyers is the new competitive advantage of Taiwan’s bicycle industry. • At least five factors supporting this kind of cooperation mode: 1.the modularity of global bicycle industry 2.the well developed broadcast mediums 3.the compensation of R&D capacity from ITIS 4.the clustering of industrial members 5.the embedeness of long term cooperation networks • It will be a difficult work for developing country to catch up with us when a bicycle has changed to be a knowledge-intensive product and the 「parallel connecting new product development process」can operate in that advanced technology

12. 時程 項目 1 2 3 4 5 6 7 8 9 10 11 12 創 意 產 生 整車 車架 傳動 車輪 制動 配件 實 體 開 發 車架 傳動 車輪 制動 配件 組裝 圖五、「傳統式」新產品開發時程圖

13. 時程 1 2 3 4 業別 系統別 項目 核心 零組件廠 傳 動 創意 落實 品牌廠商 整車 創意 車輪 零組件廠 車 輪 創意 落實 制動 零組件廠 制 動 創意 落實 配件 零組件廠 配 件 創意 落實 成 車 廠 車 架 創意 落實 整車 落實 圖六、「網路並聯形」新產品開發時程圖