A fuzzy-logic-based approach for new product Go/NoGo decision at the front end

• Authors: Ching-Torng Lin;Chen-Tung Chen
• Venue: IEEE Transactions on Systems, Man, and Cybernetics, Part A: Systems and Humans
• Year: 2004

New product development (NPD) is both a complex process and a substantial business risk. It still requires 6.6 ideas to generate a successful product. Thus, researchers claim that inferior new products should be eliminated at the front end. Limited by both the nature and the timing of NPD, managers often perform screening in uncertain environments and based on incomplete information. Furthermore, the conventional evaluation approaches, which encapsulate or merely discard the ambiguity and multiplicity of possible concerns, make a screening economically sound but dysfunctional as well. Since most assessments are described subjectively by linguistic terms, a comprehensive method for new product screening using fuzzy logic is proposed, in which the criteria ratings and their corresponding importance are assessed in linguistic terms described by fuzzy numbers, and fuzzy weighted average is employed to aggregate these fuzzy numbers into a fuzzy-possible-success rating (FPSR) of the product. Finally, the FPSR is translated back into linguistic terms to derive at a new product screening decision. Furthermore, a case study is cited to illustrate the performance within an actual decision process. The result shows that this approach can efficiently aid managers dealing with ambiguity and complex environments in achieving relatively realistic and informative results, as well as give managers a high degree of flexibility in decision-making. In addition, the variations in linguistic values and levels of linguistic variables have an effect on the ranges of the FPSR which ultimately, affect the selection of the NPD project.