Using DEA approach to develop the evaluation and priority ranking methodology for NPD projects

Abstract

With the shortening of product life cycles, new product development (NPD) has become a critical factor to the sustainable growth of enterprises. This paper proposes an integrated evaluation and priority ranking methodology of NPD projects. It uses fuzzy hierarchical analysis (FHA) to set the reasonable weights of evaluation criteria, and Data Envelopment Analysis (DEA) to analyze efficiency, in order to extract NPD projects with market potential and high added value. Given limited corporate resources, priority ranking can be implemented for NPD projects with market potential, providing a basis for senior management in developing R&D strategy. Finally, this paper explains and validates the application and significant efficiency of the proposed methodology, and offers a case study of NPD projects for electronic products. © Springer-Verlag London Limited 2009.