Role of Mid-Fidelity Prototypes in Facilitating Open Book Accounting
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One of the key success factors in today’s global and highly competitive markets is to develop new products. On the other hand, new product developments have exponentially increasing as the development project proceeds. Thus, more and more the need for evaluating ideas inexpensively and rapidly is rising. The problem with current prototyping methods is that they come late in the development stages. This problem becomes more important in lean companies which have strong relationships with their strategic allies. The current development tools and methods suggested from scholars for development of physical products do not offer flexibility and iterative development. However, this approach limits developers from testing and comparing several ideas. The objective of this report is firstly to challenge the common categorization and application of prototypes by introducing mid-fidelity prototypes to merge the two main product development models, agile and stage wise, and secondly to demonstrate the impact of these prototypes on cost estimations and how the information generated from studying them helps to facilitate open book accounting. Mid-fidelity prototypes can reduce costs of development projects by testing functionality of ideas cheaply. They are also an effective communication tool internally and also with supply network firms. The purpose of this approach is to complement the current existing literature on product development models and prototyping. To provide a deeper understanding of the implications of what such a model could offer, it was implemented and analyzed in a case of developing cleanliness of hydraulic hose assemblies. The project was done with a hydraulic hose assembly manufacturer in Finland. This research shows that first, fully functional mock-ups are effective communication tools among the development team and externally with customers or suppliers. Second, they provide hands on experience of the product for the project stakeholders. Third, they can be used to estimate associated cost impacts of the product. Fourth, the generated data could be used as factual information to be shared with strategic allies and facilitating open book accounting. However, it is noteworthy that this method is not effective applicable in high-tech and complex products due to nature of them.