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Accessory Portfolio Planning at Axis Communications

Nyström, Gustav LU and Wellander, Rasmus LU (2016) MTT820 20161
Engineering Logistics
Abstract
Abstract
Background
Axis Communications is a Lund based company which specializes in network cameras. In addition to the cameras, the company has a wide range of accessories that ensure their customers receive complete solutions. While the company has had significant successes by investing heavily in R&D, increased competition from low-cost competitors is now placing higher demands on cost-efficiency.
Problem
The high introduction rate of new cameras and solutions have resulted in an ever-expanding portfolio of accessories. As the number has grown they are starting to cause problems in the company’s operations. For example, the increased complexity is making it more difficult to balance supply and demand. Further, it is a challenge... (More)
Abstract
Background
Axis Communications is a Lund based company which specializes in network cameras. In addition to the cameras, the company has a wide range of accessories that ensure their customers receive complete solutions. While the company has had significant successes by investing heavily in R&D, increased competition from low-cost competitors is now placing higher demands on cost-efficiency.
Problem
The high introduction rate of new cameras and solutions have resulted in an ever-expanding portfolio of accessories. As the number has grown they are starting to cause problems in the company’s operations. For example, the increased complexity is making it more difficult to balance supply and demand. Further, it is a challenge due to the administrative complexities it introduces. By making more informed decisions early in the development process, it is believed the inflow of new accessories can be more controlled.
Purpose
To design a practically viable decision support model that enables more informed decisions with regards to accessory development at Axis Communications.
Method
The study has used a constructive research approach. The construct is a decision support model for Axis to use when developing accessories. The study started with a literature review to gain insight into the current body of knowledge. A multiple case study was used to contribute with empirical data on how companies work with the selection of projects in practice. Interviews and workshops at Axis were then conducted to see what construct would fit the company and product context. The final model was constructed and tested with key stakeholders at the company to ensure its validity.
Theory
In the literature review we have looked at areas which are deemed important for the problem at hand. Product portfolio management is a broad field and a literature review by Jugend & da Silva (2014) was used for the initial structure. To further structure the selection and development process, Michael Cooper’s work around the Stage-Gate process has been used. By combining the stage-gate perspective with portfolio management an input-output framework was developed. This framework has then been the basis to which we have formulated 26 theoretical propositions.

Empirical research
Axis’ camera development was used as a test case, this enabled fine tuning of the case study protocol ahead of the main cases. The companies which participated were Sony Mobile, Thule Group, Husqvarna Group and Alfa Laval. Companies were chosen to ensure a wide perspective on the contextual aspects of life cycle length, company size, profitability and technology sophistication. The study contributed with ways of practically working with selection of projects and methods of maintaining data integrity.
Analysis
Many of the theoretical propositions were supported by the case study findings. Several empirical propositions were also developed and evaluated for generalizability. Theory and empirics were then combined to form a generic decision support model which companies can use to improve development decisions. It starts with choosing criteria that are aligned with company strategy and goals of the product portfolio. These criteria then dictate the input deliverables and decision makers needed to make the decision. After the decision, a formal decision and goal setting for the ensuing work should be performed. Finally, a post-launch review should be conducted to follow-up on deliverables and decisions made at the decision point. This to ensure a learning process.
The construct
It was decided that the focus of the model would be accessories developed within camera projects. Criteria and methods were developed in order to reach the strategic goals of increasing structure, priority and data integrity of accessories. Nine suggestions were proposed to Axis. They were fitted into four different points of the current camera development structure. In short, they serve to increase early awareness of accessories within camera projects. This through requesting that certain deliverables are presented before an accessory is released for development. We also suggest the decision to order tooling receives more focus as it results in the most significant investment for an accessory. Finally, a post launch review is suggested in order to follow-up on assumptions made at the decision point. This way the process will receive continuous feedback and learning. As a result, Axis will be able to make more informed decisions regarding accessories and thus increase control over their product portfolio. (Less)
Popular Abstract
The Development of a Decision Support Model for Product Accessories at Axis Communications
The accessory product portfolio at Axis has grown significantly in later years and this comes at a cost. Increased complexity of operations now forces them to make better decisions regarding accessories. To help with this, a decision support model has been developed.
The decision to develop new products is one of the most critical within a company. Many new products fail to deliver and it is therefore paramount that the right products are developed. Of certain interest is the decision to allow a product to proceed into development. This is taken early on in the product development process and is the “point of no return”, as a majority of resources... (More)
The Development of a Decision Support Model for Product Accessories at Axis Communications
The accessory product portfolio at Axis has grown significantly in later years and this comes at a cost. Increased complexity of operations now forces them to make better decisions regarding accessories. To help with this, a decision support model has been developed.
The decision to develop new products is one of the most critical within a company. Many new products fail to deliver and it is therefore paramount that the right products are developed. Of certain interest is the decision to allow a product to proceed into development. This is taken early on in the product development process and is the “point of no return”, as a majority of resources are consumed after this point. Allowing the right product to pass this decision point is therefore critical for a successful product portfolio.
Academic literature has focused much on describing this decision point for a company’s main product but almost nothing is written about product accessories. While these are not the main focus, they contribute to costs for development and operations during their life cycle. Decisions regarding accessories are therefore important as well. To develop a decision support model for accessories we first developed one for main products. This by combining findings from literature and practice through a literature review followed by a multiple case study at Axis, Husqvarna Group, Thule, Alfa Laval and Sony Mobile. The resulting model can be used to improve product development decisions for companies’ main products.
The first model was then adapted to better fit Axis and their accessories. For this, a condensed version of the first model was chosen. To increase the chances of success, our recommendations were integrated into their current decision making process for their main product, their cameras. In short, our suggestions served to increase awareness of accessories early on to thereby make more informed decisions. We also suggested introducing a post-launch review to learn from previous decisions and make better ones in the future.
Hopefully our research can contribute with valuable insights to Axis and to the academic world. For Axis, the model can help them control their accessory portfolio which frees up resources to use for other important projects. For academics, our study presents these product development decisions from both a theoretical as well as practical perspective.
This article is only a glimpse of the study, to view it in its entirety, please refer to the full thesis named Accessory Portfolio Planning Model at Axis Communications by Gustav Nyström and Rasmus Wellander. (Less)
Please use this url to cite or link to this publication:
author
Nyström, Gustav LU and Wellander, Rasmus LU
supervisor
organization
course
MTT820 20161
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Decision support model, Accessories, Product development, Stage-gate process, Portfolio management
report number
5807
language
English
id
8878569
date added to LUP
2016-06-08 11:14:55
date last changed
2016-06-08 11:14:55
@misc{8878569,
  abstract     = {Abstract
Background
Axis Communications is a Lund based company which specializes in network cameras. In addition to the cameras, the company has a wide range of accessories that ensure their customers receive complete solutions. While the company has had significant successes by investing heavily in R&D, increased competition from low-cost competitors is now placing higher demands on cost-efficiency. 
Problem
The high introduction rate of new cameras and solutions have resulted in an ever-expanding portfolio of accessories. As the number has grown they are starting to cause problems in the company’s operations. For example, the increased complexity is making it more difficult to balance supply and demand. Further, it is a challenge due to the administrative complexities it introduces. By making more informed decisions early in the development process, it is believed the inflow of new accessories can be more controlled. 
Purpose
To design a practically viable decision support model that enables more informed decisions with regards to accessory development at Axis Communications. 
Method
The study has used a constructive research approach. The construct is a decision support model for Axis to use when developing accessories. The study started with a literature review to gain insight into the current body of knowledge. A multiple case study was used to contribute with empirical data on how companies work with the selection of projects in practice. Interviews and workshops at Axis were then conducted to see what construct would fit the company and product context. The final model was constructed and tested with key stakeholders at the company to ensure its validity. 
Theory
In the literature review we have looked at areas which are deemed important for the problem at hand. Product portfolio management is a broad field and a literature review by Jugend & da Silva (2014) was used for the initial structure. To further structure the selection and development process, Michael Cooper’s work around the Stage-Gate process has been used. By combining the stage-gate perspective with portfolio management an input-output framework was developed. This framework has then been the basis to which we have formulated 26 theoretical propositions. 
 
Empirical research
Axis’ camera development was used as a test case, this enabled fine tuning of the case study protocol ahead of the main cases. The companies which participated were Sony Mobile, Thule Group, Husqvarna Group and Alfa Laval. Companies were chosen to ensure a wide perspective on the contextual aspects of life cycle length, company size, profitability and technology sophistication. The study contributed with ways of practically working with selection of projects and methods of maintaining data integrity. 
Analysis
Many of the theoretical propositions were supported by the case study findings. Several empirical propositions were also developed and evaluated for generalizability. Theory and empirics were then combined to form a generic decision support model which companies can use to improve development decisions. It starts with choosing criteria that are aligned with company strategy and goals of the product portfolio. These criteria then dictate the input deliverables and decision makers needed to make the decision. After the decision, a formal decision and goal setting for the ensuing work should be performed. Finally, a post-launch review should be conducted to follow-up on deliverables and decisions made at the decision point. This to ensure a learning process.
The construct
It was decided that the focus of the model would be accessories developed within camera projects. Criteria and methods were developed in order to reach the strategic goals of increasing structure, priority and data integrity of accessories. Nine suggestions were proposed to Axis. They were fitted into four different points of the current camera development structure. In short, they serve to increase early awareness of accessories within camera projects. This through requesting that certain deliverables are presented before an accessory is released for development. We also suggest the decision to order tooling receives more focus as it results in the most significant investment for an accessory. Finally, a post launch review is suggested in order to follow-up on assumptions made at the decision point. This way the process will receive continuous feedback and learning. As a result, Axis will be able to make more informed decisions regarding accessories and thus increase control over their product portfolio.},
  author       = {Nyström, Gustav and Wellander, Rasmus},
  keyword      = {Decision support model,Accessories,Product development,Stage-gate process,Portfolio management},
  language     = {eng},
  note         = {Student Paper},
  title        = {Accessory Portfolio Planning at Axis Communications},
  year         = {2016},
}