Joint design manufacturing

Joint design manufacturing (JDM):

Definition: Is a collaborative effort between two business entities which shares research and development resources and costs to develop marketable products.

Scope: In a joint design manufacturing arrangement, a product marketing entity contributes their market knowledge, product requirements and unique technical capabilities to a contract manufacturer to perform certain product development functions. The contract manufacturer can contribute design engineering and new product introduction services to the product marketing entity.

Service offerings: Typical design engineering service offerings from contract manufacturers include: product architecture, development, integration, regulatory and qualification services.

Contract manufacturer new product introduction services include: quick-turn prototyping, functional test development and introduction into volume production.

Intellectual property: For products manufactured under a joint design manufacturing arrangement, the intellectual property developed by the contract manufacturer in connection with those services May Be owned by:

• The contract manufacturer (CM or JDM)

• Jointly owned by contract manufacturer and the product-marketing entity

• Owned by the product marketing entity

Intellectual property ownership depends upon the specific contracting arrangement.

Benefits: Business entities enter into these relationships to reduce some combination of risks and liabilities, costs and leverage assets to increase return on investment. Benefits to each party vary on each contract transaction. The JDM method provides the opportunity to access to know-how and expertise that one company might not have internally.

Disadvantages: The product marketing entity loses control over the implementation of [...]-edge technologies, only relying on the JDM company's claimed expertise and willingness to allocate the right skills/resources. Responsibilities over certain hard to understand technological parameters might get lost, and end up with pointing fingers at each other, risking project deadlines and product launch.