Supplier Value of Customer-Initiated Product Development: An In-Depth Case Study of a European Industrial Mass-Producer

Increased market demand and shortened product life cycles generate industrial customer requests for collaborative product development. Manufacture-to-stock suppliers struggle to manage the request process to obtain profitability. The purpose of this paper is to investigate if request management is profitable for suppliers, and to examine possible relations between profitability of requests and the requesting customer. Through a case study, request management is identified as a profitable process due to long-term accumulated profit from developed products. Request profitability is not identified as related to profitability or turnover of existing customers, and thus profitability of requests cannot be predicted based on these customer data. Results from a coupled interview study indicate that request management has a large potential for future exploitation, and an outline of the supplier value potential of collaborative product development is proposed.