In the present paper, we develop a dynamic programming (DP) model of the product development (PD) process. We conceptualize PD as a sequence of decisions: whether to incorporate a piece of information that just arrived (i.e. became available) or wait longer. We, then, utilize this formulation to analyze several different situations depending on the type and nature of information being exchanged: external versus internal information, and stationary versus dynamic information. We derive optimal decision rules to determine whether (and when) to incorporate or not for each case. An analysis of the model results in several important findings. First, we must not incorporate all available information that is related to the design activity. Once the information collection exceeds certain value, the design team should stop collecting further information. Second, only when past design work accumulates a certain threshold value should the team include the latest information and perform rework. Large uncertainty of the information and large sensitivity of the design activity make the information less likely to be incorporated. Lastly, the managerial implications are discussed with several numerical examples.

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