In the late 1980’s Caterpillar’s Engine Division had a unique product development process. Marketing would present the specifications of an engine they thought they could sell to top management and engineering. If management agreed with marketing assessment of customer’s needs and engineering thought the specifications were feasible a project was initiated. The division’s most experienced engine designer, Benny Ballheimer, was assigned to begin design work.
In two months, if Benny said the project was feasible two more engineers would be assigned to work with Benny. For one new engine this process went on for years. In fact Benny had to postpone solving many problems that arose because he did not have enough people. This included a very serious problem of limited oil life! Finally, when management wanted to launch the engine into the market, many engineers were assigned to work on the engine in a desperate attempt to solve all of the outstanding problems with the design. Costs skyrocketed and time slipped by. The engine was over budget and late to the market. The cost versus time graph looked like the one shown in Figure 1. Perhaps if a concurrent engineering strategy was employed costs would have been lower and launch date sooner.
Figure 1. Cost versus time graph for Caterpillar’s Over-the-wall design process.