IDEAS home Printed from https://ideas.repec.org/a/ids/ijelfi/v1y2007i3p275-292.html
   My bibliography  Save this article

Cash flow management of early life cycle products: a supply chain management perspective

Author

Listed:
  • Hongze Ma
  • Olli-Pekka Hilmola

Abstract

New Product Introduction (NPI) activity has considerably increased due to ever shortening product life cycles. Therefore, cash flow management is a vital part of NPI, and is based on the cumbersome equation of customers, demand development, product margin, payment programmes, supply lead times and assembly duration. Until today cash flow management of this whole system has been completed with rather primitive methods (e.g., spreadsheets or 'rule of thumb'). However, these alternatives have barely been able to show the most negative cash flow point, or sensitivity of it. In this paper we will introduce a system dynamics model incorporating all of the important elements, which will have an effect on cash flow management of early life cycle products. Based on this, methods to improve cash positions, and also manage cash flow as volumes grow and new investments are needed are being proposed. System dynamics simulation gives more support for e-finance based management, as opposed to inflexible spreadsheet models.

Suggested Citation

  • Hongze Ma & Olli-Pekka Hilmola, 2007. "Cash flow management of early life cycle products: a supply chain management perspective," International Journal of Electronic Finance, Inderscience Enterprises Ltd, vol. 1(3), pages 275-292.
    • Handle: RePEc:ids:ijelfi:v:1:y:2007:i:3:p:275-292
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=11499
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:ijelfi:v:1:y:2007:i:3:p:275-292. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=171 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.