Agile Development for Physical New Products

Agile Development was created in the software industry through the 1990s, at a time when they needed new ways to overcome many deficiencies. By 2013, we began to see evidence of manufacturers of physical products – notably those with software embedded in their products – applying Agile to their hardware developments. Many other manufacturers were soon to follow.

While Agile provides many benefits to manufacturers, it also creates new challenges. One of these is how to place an economic value on Agile projects, which are characterized by high levels of ambiguity, uncertainty and fluidity. The article outlines the Expected Commercial Value (ECV) as a useful tool to gauge the economic value of highly ambiguous Agile projects with multiple iterations. The mathematical derivation of ECV equations for such projects is described in detail in the article’s two appendices…

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The author: Dr. Anita Friis Sommer is Senior Innovation Manager at LEGO Group and holds a post.doc from University of Cambridge on process modelling. Dr. Sommer is known for her research on Agile in combination with Stage-Gate.

She is PhD in Product Development Management and Civil Engineer in Industrial Management from Aalborg University, Denmark. Email: [email protected]