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The purpose of this paper is to identify issues that are critical to developing complex, business‐to‐business products and discuss implications for vendor firms.

This paper employs the critical review approach to current complex product literature and draws from relevant literature streams in engineering, management, and marketing to propose a conceptual framework.

The critical review of the complex products research reveals the following as critical issues for research and practice in the development of complex products: definition, internal and external complexity, product and process complexity, standardized to customized complex products continuum, component and process modularity, and operant resources.

This paper identifies six specific operant resources that are critical to the development of complex products and proposes a conceptual framework. Clearly, more needs to be done in terms of theoretical and empirical research with reference to the development of complex, business‐to‐business products. For example, researchers could empirically test the proposed framework; identify other relevant operant resources; and critique the proposed framework and develop a new, more comprehensive framework.

Firms that develop complex products could focus on developing the six operant resources that can help them become competent in developing complex products; and developing organizational structures and policies and providing an organizational environment that is conducive to developing robust internal and external social capital.

The proposed conceptual framework provides a theoretical foundation for practitioners and researchers to build on.

The purpose of this paper is to propose a prediction model to predict the cost of complex products with lack of data. The cost estimating is one of the key elements of arguments around technological economy and investment decision‐making process of complex product.

A complex product has many characteristics, such as complex structure, large investment, high risk and it usually falls into small‐batch‐production category. Its cost estimation samples are small and cost data are very limited. Based on the characteristics of complex product and cost estimating, this paper introduces performance parameters sequence of associated known data, establishes an N‐GM (0, N) model of characteristic sequence with straddle missing data.

On the basis of the known key performance parameter sequence, N‐GM (0, N) model is used to predict the grey interval of overall cost vacancy data. Overall cost vacancy data is whitened by sorting reference sequence and realizing complex product overall cost estimation.

The method introduced in the paper can be used to solve practical problems, especially cost prediction of complex products with poor data. The model is also applied on the overall cost and the key component cost estimation of similar but different complex products. Moreover, it provides potential theoretical support for the development of complex product industry in the future.

In this paper, the complex product, which now plays a strategic industrial role in China, is systematically studied by utilizing a new methodology based on grey systems, especially the cost evaluation of the complex product. The use of grey correlation analysis in screening control key item index of complex product cost, the overall cost sequence of the complex product as related sequence and sorting reference sequence, the paper predicts and whitens vacant key item index, obtaining the key item cost index of complex product.

Because of the multiple design elements and complicated relationship among design elements of complex products design, it is tough for designers to systematically and dynamically express and manage the complex products design process.

To solve these problems, a supernetwork model of complex products design is constructed and analyzed in this paper. First, the design elements (customer demands, design agents, product structures, design tasks and design resources) are identified and analyzed, then the sub-network of design elements are built. Based on this, a supernetwork model of complex products design is constructed with the analysis of the relationship among sub-networks. Second, some typical and physical characteristics (robustness, vulnerability, degree and betweenness) of the supernetwork were calculated to analyze the performance of supernetwork and the features of complex product design process.

The design process of a wind turbine is studied as a case to illustrate the approach in this paper. The supernetwork can provide more information about collaborative design process of wind turbine than traditional models. Moreover, it can help managers and designers to manage the collaborative design process and improve collaborative design efficiency of wind turbine.

The authors find a new method (complex network or supernetwork) to describe and analyze complex mechanical product design.

This paper applies the knowledge-based genetic algorithm to solve the optimization problem in complex products technological processes.

The knowledge-based genetic algorithm (KGA) is defined as a hybrid genetic algorithm (GA) which combined the GA model with the knowledge model. The GA model searches the feasible space of optimization problem based on the “neighborhood search” mechanism. The knowledge model discovers some knowledge from the previous optimization process, and applies the obtained knowledge to guide the subsequent optimization process.

The experimental results suggest that the proposed KGA is feasible and available. The effective integration of GA model and knowledge model has greatly improved the optimization performance of KGA.

The technological innovation of complex products is one of effective approaches to establish the core competitiveness in future. For this reason, the KGA is proposed to the technological processes optimization of complex products.

The purpose of this paper is to identify the commonalities and differences in manufacturers’ motivations to servitise.

UK study based on interviews with 40 managers in 25 companies in 12 sectors. Using the concept of product complexity, sectors were grouped using the Complex Products and Systems (CoPS) typology: non-complex products, complex products and systems.

Motivations to servitise were categorised as competitive, demand based (i.e. derived from the customer) or economic. Motivations to servitise vary according to product complexity, although cost savings and improved service quality appear important demand-based motivations for all manufacturers. Non-complex product manufacturers also focus on services to help product differentiation. For CoPS manufacturers, both risk reduction and developing a new revenue stream were important motivations. For uniquely complex product manufacturers, stabilising revenue and increased profitability were strong motivations. For uniquely systems manufacturers, customers sought business transformation, whilst new service business models were also identified.

Using the CoPS typology, this study delineates motivations to servitise by sector. The findings show varying motivations to servitise as product complexity increases, although some motivational commonality existed across all groups. Manufacturers may have products of differing complexity within their portfolio. To overcome this limitation the unit of analysis was the strategic business unit.

Managers can reflect on and benchmark their motivation for, and opportunities from, servitisation, by considering product complexity.

The first study to categorise servitisation motivations by product complexity. Identifying that some customers of systems manufacturers seek business transformation through outsourcing.

The purpose of this exploratory paper is to analyze how complexity of an artifact affects designing processes of its mechanical, electric, and software sub‐systems.

Based on existing empirical research and frameworks of axiomatic design, product architecture, and product development process, the paper proposes a simple model of functional and structural design to examine how engineers' ways of thinking differ among mechanical, electric and software engineers.

This paper argues that products and artifacts tend to become complex (often with integral architecture) when customers' functional requirements become more demanding and societal/technological constraints become stricter, and that complex mechanical products are often accompanied by electronic control units with complex functions. This implies that designing complex mechanical products often requires intensive coordination among mechanical, electric and software engineers. This, however, is not easy, as engineers' way of thinking is often different among the three areas: mechanical engineers want to complete structural design information first to build prototypes; electrical and software engineers (the latter in particular) request complete functional information first.

In order to solve the above‐mentioned mechanical‐electrical‐software coordination problem, engineers need to share basic design concept of the product in question. Heavy‐weight product managers who infuse the product concept to the project members might be the key to this coordination. Companies may need to make sure that their product development processes are friendly to all of the three groups of engineers.

Although designing complex artifacts has been a popular research theme since H. Simon's seminal work, issues of organizational coordination for developing complex products, with increasing managerial importance, need further research. With an empirical case of the automobile and electronic products, the present paper is unique in that it combines frameworks of product development processes, product architectures, and organizational capabilities.

The development of complex products and systems is a continuously iterative process from customer requirements to a mature design. Design changes derived from multisources occur frequently during the design process. Furthermore, change propagation will impose impacts on design costs and lead times. In view of this, how to predict and control the propagation of multisource design change to reduce the changes impact is an urgent issue in the development of complex product.

In this paper, a new four-phase routing approach based on weighted and directed complex networks is proposed for multisource design change propagation. Phase I: as the foundation of this research, a product network model is established to quantify describe the complex product. Phase II: the hub nodes are identified based on the LeaderRank algorithm, which can be regarded as multisource nodes of design changes. Phase III: a calculation method for change propagation intensity is proposed, which improves the systematicness and accuracy of the evaluation results. In this paper, change propagation intensity is defined by four assessment factors: importance degree of parts, execution time of design tasks, coupling strength between parts and propagation likelihood. Phase IV: a routing method of multisource design change propagation and ant colony optimization algorithm are proposed in this paper, which can solve the coupling conflicts among change propagation paths and improve the search efficiency by using the parallel search strategy.

The proposed method and another method are used to search the optimal propagation path of multisource design change of a motorcycle engine; the results indicate that this method designed in this study has a positive effect on reducing the change impact, market response time and product design costs when design change occurs in the products design process.

The authors find a new method (a network-based four-phase routing approach) to search the optimal propagation path of multisource design change in complex products design.

The authors provide new quantitative evidence of the relationship between technologies and organizational design in the context of complex one-off products. The systems that produce complex, one-off products in mature, fragmented industries such as construction lack many of the typical organizational features that researchers have deemed critical to product development success (e.g., team familiarity, frequent communication, and strong leadership). In contrast, the complexity of these products requires a diverse knowledge base that is rarely found within a single firm. The one-off nature of construction’s products further requires improvization and development by a distributed network of highly specialized teams. And because the product is complex, significant innovations in the end product require systemic shifts in the product architecture. Riitta Katila, Raymond E. Levitt and Dana Sheffer use an original, hand-collected dataset of the design and construction of 112 energy-efficient “green” buildings in the United States, combined with in-depth fieldwork, to study these questions. A key conclusion is that the mature US construction industry, with its particularly fragmented supply chain, is not well suited to implementing “systemic innovations” that require coordination across trades or stages of the project. However, project integration across specialists with the highest levels of interdependence (i.e., craft, contract integration) mitigates the knowledge and coordination problems. There are implications for research on how technology shapes organizations (and particularly how organizations shape technology), and on the supply chain configuration strategies of firms in the construction industry as well as building owners who are seeking to build the best buildings possible within their budgets.

The purpose of this paper is to provide of selected Financial Industry Regulatory Authority (FINRA) regulatory notices and disciplinary actions issued in January, February, and March 2012.

The paper provides Regulatory Notice 12‐03, January 2012, Complex Products: Heightened Supervision of Complex Products; Regulatory Notice 12‐05, January 2012, Customer Account Protection: Verification of Emailed Instructions to Transmit or Withdraw Assets from Customer Accounts; Regulatory Notice 12‐13, March 2012, Best Execution, SEC Approves Consolidated FINRA Best Execution Rule. It summarizes ten disciplinary actions for recommending unsuitable sales of unit investment trusts (UITs) and floating rate loan funds; using misleading marketing materials in the sale of a non‐traded real estate investment trust (REIT); selling interests in private placement offerings without having a reasonable basis for recommending the securities; unsuitable sales of reverse convertible securities; violating Regulation SHO (Reg SHO) and failing to properly supervise short sales of securities and marking of sale orders; misrepresenting delinquency data and inadequate supervision in connection with the issuance of residential subprime mortgage securitizations (RMBS); permitting a registered representative to publish advertisements that failed to provide a sound basis for a reader to evaluate the products and services being offered, contained exaggerated, unwarranted and misleading statements, and failed to disclose the firm's name; failing to conduct reasonable due diligence regarding securities an entity issued; failing to disclose certain conflicts of interest in research reports and research analysts' public appearances; and failing to develop and enforce written procedures reasonably designed to achieve compliance with NASD Rule 3010(d)(2) regarding the review of electronic correspondence.

The paper reveals for Regulatory Notice 12‐03 that the decision to recommend complex products to retail investors is one that a firm should make only after the firm has implemented heightened supervisory and compliance procedures; firms also should monitor the sale of these products in a manner that is reasonably designed to ensure that each product is recommended only to a customer who understands the essential features of the product and for whom the product is suitable. For Notice 12‐05 it finds that, given the rise in incidents reported to FINRA involving fraud perpetrated through compromised customer e‐mail accounts, FINRA recommends that firms reassess their specific policies and procedures for accepting and verifying instructions to withdraw or transfer customer funds that are transmitted via email or other electronic means, as well as firms' overall policies and procedures in this area. For Notice 12‐13: FINRA Rule 5310 leaves in place the general requirements of best execution, which are for a member firm, in any transaction for or with a customer or a customer of another broker‐dealer, to use “reasonable diligence” to ascertain the best market for a security and to buy or sell in such market so that the resultant price to the customer is as favorable as possible under prevailing market conditions.

These are direct excerpts designed to provide a useful digest for the reader and an indication of regulatory trends.

In this paper, we seek to understand how changes in product architecture affect the innovation performance of firms in a complex product ecosystem. The canonical view in the literature is that changes in the technological dependencies between components, which define a product’s architecture, undermine the innovation efforts of incumbent firms because their product development efforts are built around existing architectures. We extend this prevailing view in arguing that component dependencies and changes in them affect firm innovation efforts via two principal mechanisms. First, component dependencies expand or constrain the choice set of firm component innovation efforts. From the perspective of any one component in a complex product (which we label the focal component), an increase in the flow of design information to the focal component from other (non-focal) components simultaneously increases the constraint on focal component firms in their choice of profitable R&D projects while decreasing the constraint on non-focal component firms. Second, asymmetries in component dependencies can confer disproportionate influence on some component firms in setting and dictating the trajectory of progress in the overall system. Increases in such asymmetric influence allow component firms to expand their innovation output. Using historical patenting data in the personal computer ecosystem, we develop fine-grained measures of interdependence between component technologies and changes in them over time. We find strong support for the empirical implications of our theory.