Collaborative Product Development

When two firms work together to develop and commercialize a specialized product. The smaller firm may contribute technical or creative expertise, while the larger firm may be more likely to contribute capital, marketing, and distribution capabilities. When two firms of more equal size collaborate, they may each bring some specialized technology capability to the table in developing some highly complex product or system requiring expertise in both technologies. Collaborative product development has several variations. In customer collaboration, a supplier reaches out and partners with a key or lead customer. In supplier collaboration, a company partners with the provider(s) of technologies, components, or services to create an integrated solution. In collaborative contract manufacturing, a company contracts with a manufacturing partner to produce the intended product. Collaborative development (also known as co-development) differs from simple outsourcing in its levels of depth of partnership in that the collaborative firms are linked in the process of delivering the final solution to the intended customer.

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