Enabling Product Development Teams with Collocation

Lean product development (LPD) practices are recognized as critical to the development of competitive products in our fast-paced global economy. Product development teams, particularly when team members are collocated, are a critical element of LPD practices to facilitate early involvement and parallel design of products and their processes.

The reason for this is as follows. As a company grows larger and products become more complex, hierarchical organizations are established to master the increasingly large organization size, the technical complexity, and the specialization that evolves to master this complexity. This company growth also results in the geographic dispersion of people and functional departments. These factors inhibit many of the informal relationships that previously provided effective communication and coordination between functions. Functional departments tend to focus inwardly on functional objectives. This is often described as the functional silo or stovepipe syndrome.

A hierarchical organization structure with enterprise activities directed by functional managers becomes incapable of coordinating the many cross-functional activities required to support product development as the enterprise moves toward parallel design of product and process and a focus on time-to-market. Product development teams (PDT’s) are a way to address this complexity by organizing the necessary skills and resources on a localized (team) basis to support product and process development in a highly interactive, parallel manner.


Product development teams are formed with personnel from various functional departments to support the conceptualization, proposal preparation, design, development and transition to production of a new product. This early involvement will result in a more complete understanding of all the requirements; a broader, more balanced discussion of development issues and alternatives; and a consensus approach to the design of both the product and its manufacturing and support processes. Product development teams promote open discussion and innovative thinking resulting in superior products, more efficient processes and, ultimately, a more satisfied customer. The focus of the team will be to satisfy the external customer’s product and support requirements as well as the internal customer (functional department) requirements related to factors such as producibility, cost, supportability, testability, etc.

Although PDT’s require more resources early in the development cycle, the result will not only be superior designs, but reduced resources over the life cycle of development, production and support through reduced design/build/test iterations; less effort to correct initial design deficiencies through engineering changes; and less effort to manufacture, test, fix, and support the product. The team approach will lead to greater commitment to the design and will result in a smoother transition to production.

The team consists of people from all disciplines that can positively impact the development of the product and improve competitive factors. An example of a team’s composition is shown below.


A key factor in the effectiveness of the PDT is the opportunity for regular interaction among team members and working together as a true team. If a team only meets periodically much as a committee would, interaction, working relationships, collaboration, and effectiveness are limited.

The majority of potential communication among team members regarding a product development effort is informal. This informal communication only happens when an opportunity is provided. While telephones help, frequently people play telephone tag and the need or opportunity for this communication is lost when personnel are not readily available. The physical proximity of an “expert” in another discipline will trigger asking a question and seeking or sharing information. Collocation not only facilitates this communication, it improves the nature of working relationships and leads to a more streamlined development process. This improved informal communication and coordination accelerates development activities and truly enables a parallel mode of development.


There are three stages to collocation as shown below.


The first stage locates functional departments involved in product development close together. This allows for a greater opportunity to interact with personnel from other functional departments and develop more of an understanding of other department’s objectives, responsibilities and activities.

This stage can be implemented before an organization implements PDT’s. It is a major step forward from the situation many organizations have – design engineering is on a different floor, in a different building, or even in a different city than manufacturing.

This first stage of collocation is a step toward breaking down barriers between departments that results in throwing designs over the wall. As personnel have an opportunity to interact and develop relationships, issues and questions can more easily be resolved. Personnel learn of other’s expertise and there is a greater opportunity to take advantage of “hidden knowledge”.

Joe, a design engineer, can walk down the hall and stick his head in a manufacturing engineer’s office to informally ask about a producibility issue. Without departmental collocation, this may not occur because Joe may not know who to ask the question of, or he may not have had the opportunity with dispersed departments to develop the personal relationship and feel comfortable in asking the question or discussing an issue in an informal way.

As the organization moves towards implementing PDT’s, the closer proximity of the functional departments makes it easier for the team members to work together and coordinate activities. A study in 1977, researching the effect of distance on technical communication, found that the probability of communication rapidly decreases within the first ten meters. Beyond this point, the increase of distance does not seem to have a big impact on communication.



The second stage of collocation occurs when team members are collocated in a project area. This works best when team members are dedicated full-time to a development project. When a team member is assigned to a development effort for a shorter duration or on a part-time basis, it is still possible to provide a collocated workspace. In this situation, the team member may spend part of the day or one day in one team’s project area and the rest of the day or other days in another project area or at the individual’s desk in their functional department.

As individuals are working on a day-to-day basis in close proximity, they have an opportunity to develop a close working relationship that improves overall team dynamics. This enhances the frequency and quality of communication. There is greater opportunity for feedback and discussion. There is better coordination of team activities. Team members can respond more rapidly to issues and initiate process tasks more quickly. Infrastructure requirements such as technical networks, document distribution, secretarial support, etc. are less demanding.

Collocation is facilitated with a flexible office environment and modular furniture. Collocation may require some extra space to provide flexibility in forming teams as needed, to support initiating a new development project while others are still being completed, and to provide part-time members with space in a project area while they retain a workspace in their functional department or in another project area. An open office with modular office furniture is recommended. This avoids the barrier to communication created by walls and breaks down functional and hierarchical distinctions. It provides the flexibility to re-arrange space and desks as needed to support new team requirements.

Collocation of team members not only enhances communication and early involvement, but it also allows the development process to be streamlined and provides for a more rapid performance of development activities or tasks that cross functional department boundaries. Without collocation, information needs to be distributed by interoffice mail or meetings need to be set up to resolve an issue. When team members are collocated, the task requirement can be addressed on the spot among the team members responsible.

An simple example of development process improvements resulting from collocated teams was the following. Collocation enabled improvements to the procedures for resolving supplier discrepancy reports (SDR) in a medium-sized equipment manufacturer. An SDR is prepared for discrepant material received from a supplier during the building of equipment prototypes. In the past, a material review board would review the discrepant material and determine its disposition. If the material were acceptable, it may be appropriate to change the drawing specifications to reflect what is acceptable. Previously, there was no linkage to assure the drawing was changed when appropriate to do so. Material would continue to be rejected and then bought off. When the drawing was in fact changed with an engineering change order (ECO), this process could take from weeks to months, during which time further SDR’s would be prepared and disposition action required.

When the first product development team was collocated, they soon recognized this problem and established a procedure to resolve the discrepancy on the spot. When the quality assurance team member was notified of a discrepancy in a developmental item from a supplier, that individual informally meet with other team members at their desks to discuss the situation. A conference call was placed with the supplier to discuss the discrepancy. The team was empowered to take the appropriate action. If the material was rejected, the supplier was made aware of the problem more quickly and understood what needed to be done. If the material was accepted and it was necessary to change the specifications for the item, a ECO was initiated immediately and approved by the team members within 24 hours. Rapid resolution of discrepancy problems occurred, subsequent administrative effort to resolve discrepancies was avoided, and prototypes completed sooner. The team members claimed that this process improvement would not have been made without collocation.


It is not always possible to collocate members of a product development team. Management may at first be resistant to collocation or team members may be spread among facilities located in different cities or even countries. When faced with this situation, some of the benefits of collocation can be achieved with communications and collaboration technology. This third stage of collocation has been referred to as virtual collocation.

Video conferencing can provide face-to-face contact among PDT members in different locations allowing them to more effectively discuss development issues as a group. Since a majority of person-to-person communication is non-verbal, video conferencing plays an important role in augmenting communication between two or more people at two or more sites.

While video conferencing previously was limited to use in larger organizations because of high costs, the costs of hardware and transmission are rapidly declining to bring this capability into reach for any size organization. Compression techniques and increasing bandwidth of communications are facilitating this trend. Personal computer- and workstation-based systems are available for less than $1,000.

Over the last several years, there has been increasing use of video conferencing to support product development teams, especially with international development efforts. A notable case was Apple Computer’s development of its Powerbook computer with Sony of Japan. Apple engineers made extensive use of video conferencing and claimed that it was key to meeting their aggressive development schedule.

Design automation networks can be established so that team members can look at designs on a CAD workstation in multiple locations at the same time. CAD collaboration tools allow access and mark-up of a model for all members of a team to see in their various locations. The model display can also be coordinated at one location so that all locations can be looking at a common model view. A solids model could be rotated, assembled, or disassembled to support a discussion, geometry could be created or modified on the spot in response to a discussion, and analysis could be run to respond to a question or concern in a team discussion. Software is available that provides a window for a video conference session at the same time another window shows the subject of a discussion (proposal, report, analysis, solid model, etc.) simultaneously. Other collaboration tools allow simultaneous viewing and mark-up of other documents. Web-based collaboration tools facilitate not only the dispersed internal team but also allow access to external team members (e.g., customers and suppliers) who are given access to the session.

Product data management systems are another important tools to support virtual collocation. They support access control, coordination and release management for the vast quantities of product data produced during development. The release management process embedded within these systems allow product data to be made available to team members and others at appropriate times over a network, and electronic signature capabilities overcome the need to physically distribute documents for approval. A new class of work group automation products is emerging to define process steps and coordinate and support people in the performance of cross-functional activities. These tools can also contribute to virtual collocation.

However even with these communication and system tools, there is still value in the face-to-face contact between team members. When teams are initially formed, an investment should be made in physically bringing team members together for a period of time. This will allow them to develop a relationship that is otherwise difficult to do across a distance. It develops an understanding of each individual on the team, establishes an empathy, and helps the team move through its stages of growth – forming, storming, norming and performing – more effectively and more quickly. During the course of the project, there should be opportunities for periodic face-to face meetings to address critical issues more effectively as well as maintain effective working relationships.

Product development teams provide the organizational mechanism to achieve early involvement and parallel design of products and their processes. Collocation provides the physical access and improved communication and coordination to achieve the parallel design of products and their processes. Collocation is a very simple, powerful and low cost step to enable concurrent engineering practices.

Product Development Forum Home Page