Purpose – The purpose of the research is to increase the understanding of how insufficient information sharing between internal stakeholders can be mitigated during new product development projects. Two research questions were formulated to conduct answers to the purpose.  Why is it crucial to mitigate insufficient information sharing between internal stakeholders during new product development projects? How can potential challenges during new product development projects be mitigated through information sharing between internal stakeholders? Method – To create an understanding of information sharing a literature review was conducted, which formed the foundation of the theoretical framework. Through a case study at SAAB Training & Simulation, interviews were used as the main source for empirical data. Document studies and observations were used to triangulate the findings. The collected data and theoretical framework were analyzed and discussed to propose improvements. Findings – The research findings indicate that an insufficient information flow can cause several challenges related to deadlines, profit and how information is interpreted. It should therefore be a prioritization for an organization to constantly improve how information is shared between internal stakeholders during new product development projects. Additionally, the research analysis suggests that organizations’ need to allocate more time for educational opportunities. Implications – The research highlighted a new perspective on previous research within the area. Through the research analysis statements and theories made by other researchers were further strengthened. The research suggests ways of improving information sharing between internal stakeholders. The result can be used by other industrial organizations working with new product development projects to improve their information sharing to mitigate challenges connected to insufficient information sharing. Limitations – Due to the complexity of information sharing within new product development projects, the research was limited to one case company. Additionally, mainly managers were interviewed which posed a risk that the collected data only provided an overview rather than a deep insight in the processes of sharing information between internal stakeholders. If the authors were to use several organizations and conduct more interviews, the results could increase the credibility and generalizability of the research.

Lean Product Development is a knowledge-based business concept in order to maintain high quality, meetcustomer requirements and to make product development more efficient. An important part of the processis to add a lot of resources at an early stage and execute the development as an iterative process betweendepartments exploring many alternatives thoroughly. The work focuses on how Lean ProductDevelopment is carried out and explores how to manage interaction between different departments andexpertise with regard to cross-functional collaboration and knowledge sharing i.e. learning.The information for the studies was gathered at a major Swedish company from two projects. The projectswere carried out as cross-functional and possible key factors for cross-functional collaboration wasidentified.The results have been correlated with theories of Lean, Product development, Lean product developmentand Learning. The analysis shows that to carry out activities according to Lean product development willrequire more than to follow the concept’s framework for successful implementation. Factors that areidentified as important in cross-functional collaboration is also recognised in the Lean productdevelopment theory. However the theory does not indicate how the factors is implemented and carried outbut how it should be implemented. This will create opportunities and problems for companies that want towork and implement Lean product development.

I dagsläget är det svårt för företag att behålla en stark marknadsposition och utmaningen ligger dels i att regelbundet presentera nya produkter på marknaden och ständigt skapa nya innovationer. Genom att använda sig av Lean Product Development i produktutvecklingsprocessen kan företagen anta utmaningen. Det kan dock vara svårare för små och medelstora företag då de kan ha begränsade resurser. Syftet med denna studie var därför att ta fram en projektmodell för produktutvecklingsprojekt i små och medelstora företag. Studien bygger på kvalitativa forskningsmetoder där sekundärdata samlades in genom både bibliotekskatalogen vid Mittuniversitetet och sökningar i forskningsdatabaser på Internet. Därefter samlades primärdata in via intervjuer för att göra en fallstudie och ett teoretiskt applicerbarhetstest. Resultatet som genererades visade att det som karakteriserar produktutvecklingen i små och medelstora företag var främst att chefen eller ägaren ofta påverkar produktutvecklingen och nyckelfaktorerna för en framgångsrik produktutveckling är processer, resurser, strategier och en god kommunikation. Den slutgiltiga projektmodellen baseras i stora drag på den generella projektmodellen och genomgick inga större förändringar efter det att det teoretiska applicerbarhetstestet hade genomförts. Projektmodellen består av fem stycken faser: förstudie, planering, genomförande, avslut och effekthemtagning. Samtliga presenterade projektmodeller skulle kunna fungera för att skapa processer, resurser, strategier och en god kommunikation. De nämnda projektmodellerna skiljer sig något i utformning och fokuserar på olika saker. Det som skiljer projektmodellerna åt är både roller och ansvarsbeskrivningar, beslutspunkter samt projektmodellernas olika faser. Det nyhetsvärde som denna studie har bidragit med är hur små och medelstora företag kan arbeta med projekt inom produktutveckling, och en fråga som har väckts är hur denna projektmodell skulle kunna se ut för att främja hela organisationen och inte endast produktutvecklingsavdelningen. / Today it is hard for companies to keep a strong market position and one part of the challenge is to regularly present new products on the market and constantly create new innovations.  The companies can accept that challenge by using Lean Product Development in the product development process. It can however be more difficult for small and medium sized enterprises as they may have limited resources. The purpose with this study was therefore to develop a project model for product development in small and medium sized enterprises. The study was built on qualitative research methodologies, first secondary data was collected through both the Mid Sweden University’s library catalog and searches in research databases on the Internet. Then, the primary data was collected through interviews to create a case study and a theoretical applicability test. The generated result showed that it characterizes the product development in small and medium sized enterprises primarily was that the manager or owner often affect the product development and the key factors for a successful product development was processes, resources, strategies and a good communication. The final project model are in general based on the general project model and did not underwent any major changes after the theoretical applicability test had been carried out. The project model consists of five phases: feasibility study, planning, implementation, closing and effect transfer. All of the presented project models could work to create processes, resources, strategies and a good communication. The mention project models differ slightly in the design and they are focusing on different areas. The differences in the models are the roles and responsibilities descriptions, decision points and the models different phases. The newsworthy this study has contribute with is how small and medium sized enterprises can work on projects in product, and one question that has been raised is how this project model could look like to promote the whole organization not only the product development departure.

A integração é um dos fatores determinantes da eficiência e da eficácia do processo de desenvolvimento de produtos. Neste trabalho, considera-se que um processo de negócio é integrado quando as pessoas, atividades e áreas funcionais mantêm uma relação simbiótica, que preserva as orientações individuais dos grupos especializados e que é resultante da divisão de atividades e da existência de esforços para obter unidade de ações e compatibilidade de resultados. Estes esforços são caracterizados por quatro elementos: troca de informações, coordenação, atitude colaborativa e compatibilidade. Porém, a integração só ocorre quando é empreendida ação gerencial para obtê-la. O presente trabalho apresenta a gestão de informações como esta ação gerencial, desdobrando-a em três componentes: gestão das atividades e do fluxo de informações, gestão de conflitos de decisões e gestão de memória. A partir deste contexto, propõe-se um modelo conceitual que sintetiza como, em projetos de agregação de novas funcionalidades ou customização de produtos, cada componente da gestão de informações contribui para concretizar cada elemento da integração. Para falseamento deste modelo, apresenta-se um estudo de caso isolado, realizado na unidade brasileira de um fabricante global de equipamentos elétricos. Conclui-se que os três componentes da gestão de informações contribuem para a realização da coordenação, da atitude colaborativa e da compatibilidade, e que a troca de informações é suportada apenas pela gestão das atividades e do fluxo de informações e pela gestão da memória. Conclui-se também que o modelo de processo deve ser descrito no formato de um projeto-modelo de configuração modular, que permite combinar as atividades de acordo com o tipo de produto/projeto a ser executado, e que o planejamento do projeto deve corresponder à escolha das atividades, recursos e procedimentos, dentre aqueles previstos no projeto-modelo, que serão executados e utilizados no projeto em questão. / Integration of the product development process is one of the factors determining the efficiency and effectiveness of such a process, of great importance for those companies for which product development is a factor of competitiveness. Integration is defined as the symbiotic interrelation of the entities involved in this business process. It: preserves individual orientations of the specialized groups and results from the division of activities and the existence of efforts to obtain unit of actions/compatibilities of results. These efforts are characterized by four elements: information sharing, coordination, collaboration and compatibility. However, integration only happens when managerial action is undertaken. The present work presents information management as such a managerial action, unfolding it in three components: management of activities and flow of information, management of conflicts and management of memory. Starting from this context, it proposes a conceptual model for projects of aggregation of new functionalities or customization of products that synthesizes as each component of information management contributes to render each element of integration. For verification of this model, it presents a unique case study, accomplished in the Brazilian unit of a global manufacturer of electric equipments. It concludes that the three components of information management contribute to the accomplishment of coordination, attitude of collaboration and compatibility. It also concludes that sharing of information is only supported by the management of activities and flow of information and management of memory. Its also concludes that the process model should be described in the format of a project-model of modular configuration, which allows combining the activities in agreement with the product/project type to be executed, and that planning of a project should correspond to the choice of the activities, resources and procedures, among those foreseen in the project-model, that will be executed and used in the particular project.

<p>The increasing complexity of products and systems today has forced new processes, methods, and tools for managing the development of products. It has also forced the development of complex organisations and diverse relationships among functions and peoples within product development organisations. This implies a need for integrated processes. There is a need to study collaborative product development (CPD) from a holistic perspective, where internal as well as external collaboration are studied as integrated parts of CPD settings.</p><p>Thus, the main purpose of the research project is to facilitate the efficient execution of collaborative product development projects in the manufacturing industry. Further, the objective is to provide a supporting model for analysing and setting up projects in CPD settings. This will enable successful product development in terms of lowering costs, increasing the perceived quality of the product, and improving the timing to market. The focus is on the CPD projects, linking internal and external collaboration.</p><p>A systems approach is applied to the research project to obtain the holistic view needed for addressing the CPD setting. Within the research project, case study research is used as the primary method when gathering empirics. The results from four case studies are tested and analysed in a concluding survey.</p><p>The results show that shared visions and goals, the decision-making process, tools and methods, requirement management, and involvement are the most important factors for efficient CPD projects. If the collaborative complexity is high, the first four factors are especially important. The results are presented in a model to be used as a support when setting-up and managing CPD projects. The model is applied together with a process for managing CPD projects.</p>

The increasing complexity of products and systems today has forced new processes, methods, and tools for managing the development of products. It has also forced the development of complex organisations and diverse relationships among functions and peoples within product development organisations. This implies a need for integrated processes. There is a need to study collaborative product development (CPD) from a holistic perspective, where internal as well as external collaboration are studied as integrated parts of CPD settings. Thus, the main purpose of the research project is to facilitate the efficient execution of collaborative product development projects in the manufacturing industry. Further, the objective is to provide a supporting model for analysing and setting up projects in CPD settings. This will enable successful product development in terms of lowering costs, increasing the perceived quality of the product, and improving the timing to market. The focus is on the CPD projects, linking internal and external collaboration. A systems approach is applied to the research project to obtain the holistic view needed for addressing the CPD setting. Within the research project, case study research is used as the primary method when gathering empirics. The results from four case studies are tested and analysed in a concluding survey. The results show that shared visions and goals, the decision-making process, tools and methods, requirement management, and involvement are the most important factors for efficient CPD projects. If the collaborative complexity is high, the first four factors are especially important. The results are presented in a model to be used as a support when setting-up and managing CPD projects. The model is applied together with a process for managing CPD projects.

Emerging markets are fraught with uncertainty, diverse global players, rapid technological change, wide-spread price wars, and seemingly endless reorganization (Ilinitch, 1996). These changes have presented challenges to organizations in the form of shorter product cycles, increased segment fragmentation, blurring industry boundaries, breaking corporate hierarchies, and increased interdependence of world markets (Ozsomer et. al., 1991). Organizations are responding to competition by capitalizing on global policies and adopting self-directed teams and horizontal structures that enhance external activities. To do this organizations are getting conscious of the boundaries they are operating in. With hyper competition and globalization organizations blur boundaries to gain maximum business opportunity from other geographic boundaries. For this to happen organizations must engage in boundary crossing behaviour. Competition is also managed by focussing on bringing out new products to the market. Product development (PD) is critical because new products are becoming the nexus of competition for firms (Clark and Fujimoto, 1991). They are the means by which members of organizations diversify, adapt, and even reinvent their firms to match evolving market and technological conditions (Schoonhoven et. al., 1990). This calls for a closer look at boundary crossing behaviour as part of the external activity during PD. The studies carried out in the process of PD identify external activity orientation as important criteria for success (Brown and Eisenhardt, 1995). PD processes involve project management activity. Unlike other processes of an organization, PD is a knowledge intensive activity, which brings together individuals having different skill sets and mindsets. These individuals need to interact regularly to understand and coordinate their activities. The non-routine nature of the process makes boundary-crossing activity more critical for successful PD. This thesis focuses on the boundary crossing behaviours performed by PD teams. Literature review showed that external activities play a crucial role in PD (Calantoue and Di Benedetto 1990a, b; Griffin and Hauser 1992; Olson et. al., 1995; Song et al., 2000; Souder 1987). The importance of external activities for successful project development was shown by Allen (1971, 1977) based on his seminal work on communication and organizations. He showed that R&D team’s frequency of communication within the team has no relationship to performance, while increased communication between teams and other parts of the laboratory was strongly related to project performance. Teams carrying out complex tasks in uncertain environments were found to perform higher levels of external activities (Ancona and Caldwell 1992). External activity was found to result in high percentages of successful projects and sales derived from new products (Cooper 1984; Dougherty 1987; Ancona and Caldwell, 1992; Ancona, 1990; Sheremata 2002). PD is an activity with high uncertainty. The external activities that are performed by PD teams and their nature of relationships shared are variously classified as interactive and collaborative behaviour (Kahn 1996). Underlying this classification is a dichotomous behaviour where in the former embodies presence of informal behaviour between partners, while the latter embodies formal behaviour. Further research on these behaviours have shown that informal type of external activity also known as collaborative behaviour plays an important role in the successful development of products. Collaboration represents the unstructured, affective nature of interdepartmental relationships. They were found to result in improved product development. A study on software product development teams by Kraut and Streeter(1995) also showed the importance of informal behaviour. He found that product development requires personal communication across functional boundaries to cope with uncertainty. The external activities performed by PD teams were also found to be influenced by variables like product development life cycle (Brodbeck, 2001; Sawyer & Guinan, 1998; Boehm, 1987), informal groups (Hirschhorn and Gilmore, 1992), awareness, (Pinto and Slevin, 1987), and open climate (Ashkenas et. al., 1990). After identifying the missing gaps in gaps were the objectives of the study was defined. The objectives of the study are as follows: To understand the interactive and collaborative boundary crossing behaviour of product development teams To study the difference in boundary crossing behaviour of horizontal, geographic and value chain boundaries of product development teams To understand the relationship of variables influencing boundary crossing behaviour of product development teams To give suggestions to better understand management of boundary crossing behaviour in product development teams A combination of qualitative and quantitative techniques was adopted to study these objectives. Based on the past literature a conceptual framework was developed. It consisted of defining the role of collaborative and interactive boundary crossing behaviours across product development teams and certain variables influencing this behaviour. The model was validated through preliminary interviews. These interviews were conducted across team members, team leaders and knowledge management experts. A few more variables were identified that were considered to influence the collaborative behaviour performed by PD teams. These variables are sharing behaviour and confidence with the time available for developing the product. The variables were operationally defined and measurement instrument, namely a questionnaire, was developed. The questionnaire was administered to team leaders and team members. The measurement instrument was tested for its psychometric properties namely, reliability and validity. Cronbach alphas are reported. For the main study, data was collected from 73 product development teams of IT organizations located in Bangalore. From the team leader the general characteristics of the PD team were understood, as well as the level of newness of the product developed. The latter was used as a measure of level of innovation. From team members, the interactive and collaborative behaviour of PD team members was studied. The statistical techniques that were used for analyzing the data are F-Test, t-test, Kruskall Wallis test, chi-square test , correlation and regression analyses. After the analysis it was found that the interactive and collaborative behaviour expressed by the teams across the three boundaries showed that as compared to collaborative behavior, product development teams more commonly used interactive behaviour. Interactive behaviours were also found to be used to the same extent across all the three boundaries. Since interactive behavior is formal and forced in organizations it is predominantly practiced although its efficiency may vary. The challenge for organizations hence is the collaborative behaviors. On the other hand, collaborative behaviour was seen used the most across horizontal boundary and the least across value chain boundary. Since the geographic distance across boundaries increases when moving from horizontal to value chain boundaries the chances of collaboration get decreased. Hence an influence of distance on boundary crossing behavior was sense influencing collaborative behaviour of product development teams. Hence further analysis focused on collaborative behaviors. The collaborative behaviour was further studied to understand its relationship with product development team behaviour, sharing behaviour of teams of outside the boundary, demographic variables and innovation level of product developed. Correlation analysis showed that the collaborative behaviour of teams were correlated with the sharing behaviour, informal groups, autonomous team leader behaviour, and open climate only. These variables were termed direct influencers of collaborative behavior.Innovation level did not play any significant role in influencing collaborative behavior.Collaboration behaviour was further studied to understand how they are causally related with these variables. Using regression analysis, the causal study considered collaboration behaviour of PD teams in general, as well as the collaboration behaviour across horizontal, geographical and value-chain boundary as the dependent variable. The independent variables studied are sharing behaviour, informal groups, open-climate behaviors, autonomous team leader behaviour. Regression results showed that open climate behaviours was causally related to overall collaboration behaviour of PD teams in all boundaries. With respect to collaboration across horizontal boundary, it was found that sharing behaviour, as well as autonomous team leader behaviour influenced them. Across geographical boundary, the open-climate was found causally related. Across value chain boundary sharing behaviour was found to influence collaborative behaviour. It was found that only some variables influence boundary crossing behavior namely, collaborative behavior, the most. These were open climate behaviors, sharing behaviour, and autonomous team leader behaviour. These were labeled direct influencers. The ones that did not show a direct influence were termed as indirect influencers. Since the role of direct influencers was clearly understood, the role of indirect influencers needed further analysis as these were variables selected from literature and expert interviews and expected to have influence on boundary crossing behaviour. Those variables that did not directly enter the regression analysis were further studied tounder stand if they had a relationship with the direct influencers independent of collaborative behaviors. It was assumed that if they did then they may indirectly influence collaborative behaviors. For this the indirect variables were correlated with the direct influencers. The results showed that open-climate was positively correlated with awareness of objectives, PD life cycle and the team’s confidence in time line of the project. Interestingly sharing behavior and autonomous behaviour of the team leader was not correlated with any potentially indirect influencer or variable. This meant that awareness of objectives, PD life cycle and the team’s confidence in time line of the project can influence collaborative behavior indirectly. In the next analysis the role of PD was understood deeper in the context of level of innovation and duration of projects vis-à-vis collaboration. This is specifically done as the poor influence of level of innovation and duration were a surprise since they were expected to have influence on boundary crossing behavior. Teams were classified into low, medium and high innovation level teams. The collaboration behaviour within these teams was then studied. The results showed that there was a pattern in the usage of collaboration behaviour across the different channels. Collaboration behaviour was used most across medium innovation level team as compared to low and high innovation level teams. This was the case of collaboration across horizontal and geographical boundary. In the case of value chain boundary, no such pattern was recognizable. Interestingly it meant that in low and high innovation collaborative behavior was lower and it increased only during medium innovation. Further to this, the influence of collaboration on duration of product developed was studied. The correlation study showed negative relation between the two only for horizontal boundaries. This meant that increase in collaborative behavior across horizontal boundaries result in lesser time taken to develop the product. The last chapter in this thesis describes the conclusions from this study and the managerial implications regarding nurturing and managing boundaries of PD teams.

A integração é um dos fatores determinantes da eficiência e da eficácia do processo de desenvolvimento de produtos. Neste trabalho, considera-se que um processo de negócio é integrado quando as pessoas, atividades e áreas funcionais mantêm uma relação simbiótica, que preserva as orientações individuais dos grupos especializados e que é resultante da divisão de atividades e da existência de esforços para obter unidade de ações e compatibilidade de resultados. Estes esforços são caracterizados por quatro elementos: troca de informações, coordenação, atitude colaborativa e compatibilidade. Porém, a integração só ocorre quando é empreendida ação gerencial para obtê-la. O presente trabalho apresenta a gestão de informações como esta ação gerencial, desdobrando-a em três componentes: gestão das atividades e do fluxo de informações, gestão de conflitos de decisões e gestão de memória. A partir deste contexto, propõe-se um modelo conceitual que sintetiza como, em projetos de agregação de novas funcionalidades ou customização de produtos, cada componente da gestão de informações contribui para concretizar cada elemento da integração. Para falseamento deste modelo, apresenta-se um estudo de caso isolado, realizado na unidade brasileira de um fabricante global de equipamentos elétricos. Conclui-se que os três componentes da gestão de informações contribuem para a realização da coordenação, da atitude colaborativa e da compatibilidade, e que a troca de informações é suportada apenas pela gestão das atividades e do fluxo de informações e pela gestão da memória. Conclui-se também que o modelo de processo deve ser descrito no formato de um projeto-modelo de configuração modular, que permite combinar as atividades de acordo com o tipo de produto/projeto a ser executado, e que o planejamento do projeto deve corresponder à escolha das atividades, recursos e procedimentos, dentre aqueles previstos no projeto-modelo, que serão executados e utilizados no projeto em questão. / Integration of the product development process is one of the factors determining the efficiency and effectiveness of such a process, of great importance for those companies for which product development is a factor of competitiveness. Integration is defined as the symbiotic interrelation of the entities involved in this business process. It: preserves individual orientations of the specialized groups and results from the division of activities and the existence of efforts to obtain unit of actions/compatibilities of results. These efforts are characterized by four elements: information sharing, coordination, collaboration and compatibility. However, integration only happens when managerial action is undertaken. The present work presents information management as such a managerial action, unfolding it in three components: management of activities and flow of information, management of conflicts and management of memory. Starting from this context, it proposes a conceptual model for projects of aggregation of new functionalities or customization of products that synthesizes as each component of information management contributes to render each element of integration. For verification of this model, it presents a unique case study, accomplished in the Brazilian unit of a global manufacturer of electric equipments. It concludes that the three components of information management contribute to the accomplishment of coordination, attitude of collaboration and compatibility. It also concludes that sharing of information is only supported by the management of activities and flow of information and management of memory. Its also concludes that the process model should be described in the format of a project-model of modular configuration, which allows combining the activities in agreement with the product/project type to be executed, and that planning of a project should correspond to the choice of the activities, resources and procedures, among those foreseen in the project-model, that will be executed and used in the particular project.

Product development process (PDP) architecture holds the key to the management of New Product Development (NPD). A lot of care is exercised in managing the NPD to reduce risk and uncertainties. There exists potential scope for improvement both in initial planning as well as execution of the NPD program by studying the PDP architecture. This research work seeks to taps this potential and presents an analytical tool to aid the NPD Managers. In this research work Design Structure Matrices (DSM) are used to represent the PDP architecture. The Work Transformation Matrix (WTM) is a kind of DSM and it was introduced for the analysis of concurrent task structures. However a generalized task structure has not been studied analytically in the literature. In order to study a generalized task structure we add two new matrix types to the WTM set to represent the task network interconnections and the task interdependence. First we study the pure sequential task iteration structure for NPD and show that it has lower engineering effort (cost and time) than the concurrent task iteration structure previously discussed in literature. Next we study the generalized task iteration structure and derive the expressions for total work and cost vectors. This is a major research contribution since only simulation based methods are currently available for studying generalized task iteration structures. The optimization of sequencing interdependent tasks is a well known NP hard problem in NPD literature. For small sized task sets, exhaustive enumeration of all possible sequencing and their corresponding time or cost vectors can be computed to determine the optimal sequence. However for large sized task networks, only heuristic methods are deployed. Using the closed form expression for cost and time vectors for a pure sequential task iteration structure derived earlier in this research work, we attempt to devise a method to optimally sequence the design tasks. We develop new matrix combining both the node and link weightages of task network. Using the time vector relationship between sequential and concurrent task structures, it is shown that the optimal task sequence corresponds to the reordering of this combined matrix whose “Dominance index” (sum above the diagonal) is minimum. Finally, we use some of the standard test cases from the PDP literature to demonstrate our research findings.

Published Article / At Helsinki University of Technology rapid prototyping, rapid tooling and rapid manufacturing technologies and applications have been researched since late 1980s. The Integrated Design and Manufacturing research group has concentrated on new industrial Rapid Prototyping and Manufacturing (RP&M) applications within product development and manufacturing. This paper is based on research projects realized in 2001 - 2004 in cooperation with several industrial companies. New developments within industrial product development paradigms and processes will be discussed. The paper attempts to link current industrial management sciences research with latest developments within rapid manufacturing technologies. Product platforms, product customization and networked manufacturing have become common product development management paradigms in many industrial sectors. These paradigms have lead to an increasing number of product configurations and variations. Traditionally cost comparisons between RP&M processes and conventional manufacturing processes have been based on break even point calculations. The latest product development and manufacturing paradigms places agility in production and efficient prototyping technologies among others in an important role. Conventional cost per part comparison methods to value rapid manufacturing need to be re-engineered. In those comparisons the first break even point does not describe the overall rapid manufacturing economy. For example, effects of neccesity for product change, tool wear or tool defect have to be taken into consideration. In this paper the new cost modeling technology and some industrial case studies will be described.