Exploration of the product phase-out process in manufacturing firms: A human factor perspective

In today’s dynamic environment with shortened product life cycles, phase-outs because of product elimination are becoming increasingly frequent. Research on the phase-out process is still scarce. The lack of formalization of the process, especially from the labor perspective, leads to disturbances in phase-out execution. Therefore, the purpose of this paper is to analyze how phase-out is organized in industry to derive a generic labor phase-out process.

This research identifies manufacturing firms that have eliminated products in the past as an adequate sample. Data collection relies on exploratory cross-industry after-the-fact interviews of entirely finished replacement and closure phase-outs.

The labor phase-out process consists of four stages and each stage of several activities. There are two types of activities: rational and emotional, which should be combined to support companies in implementing a successful phase-out.

Phase-out is a sensitive process, and many experts from industry do not like to discuss phase-outs, in particular closure phase-outs. Although cross-industry coverage could be achieved, companies that intend to apply the developed process should individually adapt it to their own requirements and their own context.

The presented labor process supports companies in formalizing phase-out, while identifying best practices.

This research sheds light on a phase of the production cycle – the phase-out – that has been neglected so far in the extant literature and generates insights for manufacturing companies how they can formalize this process and how they can deal with it more systematically.