Embodying Product and Process Flexibility to Cope with Challenging Project Deliveries

Abstract

Four factors make it challenging to manage semiconductor fabrication facility (“fabs”) projects: technical complexity of the product design, need to compress the project duration, need to reduce upfront costs, and unexpected project changes. The strategies employed by practitioners to cope with these challenges form an intricate puzzle. We empirically develop a framework that provides a structure for helping to solve this puzzle, which comprises two principles: investing upfront in a flexible product design and structuring a flexible process. Empirical findings reveal that project teams make commitments early on by overdesigning but also postpone critical decisions by differentiating the scope of their work. Project teams employ other strategies such as increasing communication, using modular architectures, engaging in four-dimensional computer-based modeling, and fabricating components and subsystems off-site. Our analysis yields understanding on the purposes and performance tradeoffs of these strategies, and on how they embody the two principles. Project managers may find the framework useful when deciding which strategies best suit other equally challenging projects.