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Key Organizational Issues during the Fuzzy Front End
Early classification of projects/ideas (newness; potential) Strong Project Management (important projects) Multifunctional Team (esp. R&D and Marketing) Core Team Members Sufficient (financial and human) resources; relatively more
corporate funds Top Management Involvement at Milestones (Steering) Involve Champions Early (high level of the organization)
Strengthening of the Fuzzy Front End and Improving T2Min the Early Stages of NPD
Results: Ideas are taken out of the heads Ideas are discussed Knowledge does not get lost Good ideas are implemented fast
(Ø: T2M reduced by 6 months in FFE)
Strengths of the 3M ESPE approach: Intelligent IT Implementation Incentives for Ideas Top-Management Commitment Corresponding Corporate Culture Integration into Workflows / NPD Process Clear Business Focus (evaluation criteria) Clear Responsibilities (defined tasks) Inventor shares are self-determined
Main characteristics:1. Project team is completely independent from both divisional and functional units2. Project manager has the right to issue directives both in the professional
and disciplinary sphere3. Project manager has project and bottom-line responsibility 4. Multifunctional composition (compensation for lower degree of
specialization by clear separation form the line hierarchy)5. Often used projects with a high degree of newness, important and/or urgent projects
(importance of lead times, e.g. telecommunications (Barczak, 1995))
Main advantages and disadvantages:+ Clear focus on the goals of the project+ Efficient project management+ Minimization of interfaces (composition of the team, incentives )+ Separation from the other parts of the firm (separation from daily business)+ positive effect on the motivation of the team members- Process of independence (deviation from the goals of the company)- Emergence of independent product areas
(low synergies, lower degree of information sharing)- Re-integration of project team members after completion
1. Project team not independent from functional or divisional structures2. Responsibility shared between line and project managers3. Project manager‘s authority to issue directives limited to
professional sphere (no disciplinary authority)4. Division of decision making process: PM (What? When?), FM (Who? How?)
Main advantages and disadvantages:
+ Improved inter-functional communication and co-ordination+ More influential project manager+ Stronger focus on the project+ Access to specialized know-how in the functional units- Decision making process slower - Potential for conflicts increased- Fuzzy hierarchical positions
- Incubator is designed to take up those ideas from corporate research or other parts of the organizationthat would drop out of the standard innovation process due to lack of relevance for Bosch‘s establishedbusiness
- Startups are not obliged to follow Bosch‘s several hundred corporate procedural directives, but arebound to only about a dozen basic guidelines governing values and compliance
Goal: to integrate the startup back into an existing business unit or create a new unit inside the company tocommercialize it. Spinning it off or selling are secondary options.
Siemens Technology to Business (TTB)(Outside-In Startup Program)
- TTB globally screens about 1,200 potential project pipeline ideas per year- 80 of them go into detailed evaluation and 16 of them reach project status- 72 projects started since 1999 – resulting in 12 new products or entire product lines- Non-equity partnership with startups as most dominant type of incubation in the past five years- Central element of the partnership is the joint-development-agreement (which includes among
others all IP-related issues)- Most interesting technologies (for Siemens) today come out of universities in the form of a startup No more need for Siemens to engage in early-stage incubation (“There are a lot of people or
organizations who know how to build a new company really, really well – we don‘t need toreproduce that“)
While SAP is worldwide renowned for its ERP software (R/2, R/3), it is opening up towards start-ups that develop new applications to enter new markets (start-ups, smaller firms)
Hasso Plattner – one of the founders himself – is driving this strategic change (“This is the future of SAP”)
With a new product/database called Hana (in-memory technology,) SAP get‘s into new markets where huge amounts of data needs to be processed (e.g. PARKYA)
SAP builds an eco system based on Hana and other products encompassing more than one million developers
SAP invests money into these start-ups (405 Mio. US$) More than 1,500 startups by mid-2014 as early adopters of the Hana platform E.g., a startup CEO who was targeting the oil & gas industry, said SAP was „extremely helpful and
responsive“ in providing him with contacts and a demo opportunity for that particular industry.
Taking the firm into new business areas byInside-Out Platform Programs: The case of SAP