The balanced scorecard (BSC) has become a popular concept for performance measurement. It focuses attention of management on only a few performance measures and bridges different functional areas as it includes both financial and non-financial measures. However, doubts frequently arise regarding the quality of the BSCs developed as well as the quality of the process in which this development takes place. This article describes a case study in which system dynamics (SD) modelling and simulation was used to overcome both kinds of problems. In a two-stage modelling process (qualitative causal loop diagramming followed by quantitative simulation), a BSC was developed for management of one organizational unit of a leading Dutch insurer. This research illustrates how, through their involvement in this development process, management came to understand that seemingly contradictory goals such as customer satisfaction, employee satisfaction and employee productivity were, in fact, better seen as mutually reinforcing. Also, analysis of the SD model showed how, contrary to ex ante management intuition, performance would first have to drop further before significant improvements could be realized. Finally, the quantitative modelling process also helped to evaluate several improvement initiatives that were under consideration at the time, proving some of them to have unclear benefits, others to be very promising indeed.

Stage-Gate s is a widely used product innovation process for managing portfolios of new product development projects. The process enables companies to minimize uncertainty by helping them identify-at various stages or gates-the ''wrong'' projects before too many resources are invested. The present research looks at the question of whether using Stage-Gate s may lead companies also to jettison some ''right'' projects (i.e., those that could have become successful). The specific context of this research involves projects characterized by asymmetrical uncertainty: where workload is usually underestimated at the start (because new development tasks or new customer requirements are discovered after the project begins) and where the development team's size is often overestimated (because assembling a productive team takes more time than anticipated). Software development projects are a perfect example. In the context of an underestimated workload and an understaffed team, the Stage-Gate s philosophy of low investment at the start may set off a negative dynamic: low investments in the beginning lead to massive schedule pressure, which increases turnover in an already understaffed team and results in the team missing schedules for the first stage. This delay cascades into the second stage and eventually leads management to conclude that the project is not viable and should be abandoned. However, this paper shows how, with slightly more flexible thinking (i.e., initial Stage-Gate s investments that are slightly less lean), some of the ostensibly ''wrong'' projects can actually become the ''right'' projects to pursue. Principal conclusions of the analysis are as follows: (1) adhering strictly to the Stage-Gate s philosophy may well kill off viable projects and damage the firm's bottom line; (2) slightly relaxing the initial investment constraint can improve the dynamics of project execution; and (3) during a project's first stages, managers should focus more on ramping up their project team than on containing project costs.

PurposeThis paper aims to describe three exploratory field studies investigating which characteristics add to later time to market and/or low product functionality of newly developed products. The studies are conducted at the level of developments tasks, or work packages. The first and second studies investigate to what extent the unpredictability of the project's outcome is the result of the unpredictability of the completion time of individual work packages, and of the instability of the total network of work packages.Design/methodology/approachStatistical analysis of the empirical data about the progress of three design projects carried out in the development department of a high‐tech capital equipment manufacturer was used. The third study examines the reasons that members of the product development teams in this firm give for the unpredictability of time and quality of the project's outcome.FindingsThe results result indicate the existence of three very different sources of unpredictability: the usual uncertainty about the duration of a design task, the discovery of unexpected new problems in a design task, and the reprioritization of a work package by project leaders due to new problems in other work packages.Originality/valueTogether the three studies provide a detailed account of the operational characteristics of time‐paced product development projects in a particular firm and suggest ways to effectively manage such a project.

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