June 07 Doing the Right Projects! Doing Projects Right!
Jan 12, 2016
June 07
Doing the Right Projects!
Doing Projects Right!
Stage-Gate Process• Almost 70% of leading U.S. product developers
now use some type of Stage-Gate process. • Sound research, best practices, used world-
wide.
Benefits• Accelerates speed-to-market • Increases likelihood of product success • Introduces discipline into an ordinarily chaotic process • Reduces re-work and other forms of waste • Improves focus via gates where poor projects are killed • Achieves efficient and effective allocation of scarce
resources • Ensures a complete process – no critical steps are
omitted
Critical Success Driver #1
The number one success driver is a unique, superior product: a differentiated product that delivers unique benefits and superior value to the customer.
• But “me-too”, ho-hum, copy-cat, tired products tend to be the rule rather than the exception!
• Engineers or scientists building a monument to themselves
• The quest must be for real product advantages
Critical Success Driver #2A strong market orientation – a market driven and
customer focused new product process – Success factors in every study: needs
recognition, understanding user needs, constant customer contact, strong market knowledge, market research, quality of execution of marketing activities, up-front marketing activities are all key to success
– A strong market orientation is missing in the majority of new projects
Critical Success Driver #3More pre-development work – the homework or ‘up-front’ activities
• Screening, market studies, tech feasibility, build business case • But little time and effort are spent here: 7% of money and 16%
of effort (Japanese and highly successful US firms spend considerably more here)
• Homework answers key questions before Development begins:– Is the project economically attractive?– Who is the target customer? What positioning?– What should the product be? features, attributes, performance – Can it be developed? At the right cost? How?
Critical Success Driver #4Sharp and early product & project definition (before Development)
• This definition includes:1. Project scope2. Target market definition3. Product concept & benefits to be delivered: value proposition4. Positioning strategy (include price point)5. Features, attributes, requirements & specs
• Why so critical?1. Forces homework to be done up-front (Success Driver #3)2. Communication tool 3. Provides clear targets for Development
Critical Success Factor #5
An international orientation in product design, development and target market selection is more successful
• International products aimed at world regional export markets– Global products– “Glocal” products
• Often missed by North American firms!
Critical Success Driver #6The right organizational structure & design are keys to new product success
• A true cross-functional team approach– Responsible for the project, not to their department– On the project end-to-end
• Team empowerment– Control over project’s resources
• Team accountability– Responsible for achieving agreed-to goals
• A clearly defined team leader– Chosen for the right reasons
Most firms have too many projects and too few resources to do them!Why? … A failure to focus
We want “funnels”..not “tunnels”•Begin with many solid concepts•Successively remove the poor ones•Must “drown some puppies”
Critical Success Driver #7
Critical Success Driver #8Leveraging core competencies is vital to success
• Why?– Resources: are available & at marginal cost – Experience: there are fewer surprises – less goes wrong!
• Two types of competencies:– Technological – both Development and Manufacturing– Marketing – customer base, channels, sales force, service,
etc.• Important screening or project selection criteria
– Rate the project on technological & marketing leverage
Critical Success Driver #9
The Resources Must Be In Place!“Even the best game plan comes to nothing if the players
aren’t on the field!”“Urgent things always take precedence over important
things”• Best performers are resource rich in New Product
Development:• Sales people• Marketing people• Manufacturing or Operations people• Technical or R&D people
Critical Success Driver #10
Top management support doesn’t guarantee success, but it sure helps
• Top management support critical to getting projects to market
• But top managers tend to drive failures with a higher frequency than average successes!
• Top management’s role: to set the stage – a behind the scenes facilitator (not so much an actor)
Stage-Gate Product Development
• A System from Idea to Launch
• Breaks the New Product Development Process into a series of manageable and simple stages
• Used by leading corporations world wide
• Adapted for each situation
Stages in the System
Scoping
Build Business
Case
Gate 1
Stage 1
Stage 2 Stage 3Gate 2Gate 3
Idea Screen
Second Screen
Go To Development
Development
Gates = Decision or GO /KILL Points
Gates are the quality control check points in the process
GATES – ensuring only the RIGHT projects move forward
• Readiness check & quality of execution:– Steps executed– Deliverables in place
• Business Rationale:– Attractive opportunity?– Strategic project?
• Action Plans:– Forward Plan good?– Resources available and
committed?
Set up an “Idea Capture” System
• Intake point/s – Innovation Champion
• Proactive in seeking projects
• Takes projects or ideas to Gate 1
• Gets decision• Move forward to Stage 1 OR into Idea Vault or
Bank
Gate 1 – Idea Screen• The initial GO/KILL Decision• First but tentative commitment of resources: a flickering
green light• Develop a forward plan for Stage 1
Must Meet Criteria for GO: Minimum Market Size, No Show-Stoppers
Should Meet Criteria:Strategic Fit, Technical Feasibility, Market Attractiveness, Competitive advantage (Rating 1 to5)
Stage 1 - Scoping• A preliminary investigation• Within one month• Key Tasks
– Preliminary Market Assessment– Preliminary Technical Assessment– Preliminary Business Analysis– IP, Regulatory, Safety
• Gate Deliverables – Prelim Product Def & Bus Case
Gate 2 – Second Screen• Second review – Better
information• Opens the door to a more
expensive second stage – Building the Business Case
• Gatekeepers?• Approval of the Forward
Plan and Resources
Should Meet Criteria:Strategic Fit, Technical Feasibility, Market Attractiveness, Competitive adv, Core Competency, Risk/Reward (Rating 1 to5)
Stage 2 – Build the Business Case
• Makes or Breaks the Project
• Detailed Investigation• The Business
Plan/Feasibility
• Key Tasks– Market Analysis– Competitive Analysis– Voice of Customer– Concept Test– Technical: Proof of
feasibility– Production/operations– Legal– Management– Financial
Gate 3 – Go to Development• The “money gate”• Opens the door to full scale
development & heavy commitment
• Must have: – Complete plan– Defined product– Full financial review
Stage 3 - Development• Implementation of Development Plan
– Develop the product as per the Gate 3 Definition– Undertake in-house product testing (lab, alpha)– Conduct limited customer test via “show & tell”– Develop manufacturing (operations) process– Develop detailed Test Plans– Develop Launch Plans
• Detailed Market Launch Plan• Production/Operations & Quality Assurance plans
Gate 4 – Go to Testing• Opens the door to
Stage 4 – Validation and Testing
• Review of Financials• Review and approval
of Test Plans
• Criteria for Go:– Quality of Activities in
Stage 3– Deliverables and
Readiness Check– Consistency Check –
prototype consistent with definition
– Revisit criteria and business plan
Stage 4 – Testing and Validation
• The final tests of the product, production and operations & marketing strategy prior to full commercialization
• Update financial analysis• Prepare final Launch Plan
Gate 5 – Go to Launch
• The final GO/KILL gate in the process
• Involves:– A critical review of all activities and results– A review of the updated financials– A review & approval of finalized production
and market launch plans– Check list that all is commercial-ready
Stage 5 - Launch• Key Tasks to Implement:• Production/Operations Plan• Market Launch Plan• Post Launch (monitor &
adjust)• Product Life Cycle Plan
How Gates Work• The project leader drives the project from
stage to stage, gate to gate (the proponent)• The leader submits the inputs or deliverables
to each gate at the completion of a stage• The deliverables are pre-set
– A visible list of requirements – clear expectations– Based on a standard list or menu
• Deliverables provide the information needed for the Gate decision
Who are the Gatekeepers?• Management• Represent different
functional areas• Resource-owners• Authority to approve
and support
Gatekeepers and Their Role• Discipline – regular meetings and be there• Arrive prepared• Use the list of criteria – no hidden criteria• Ensure all project treated the same• Fast same day decisions• Provide advice and assistance on projects
Flexible and Scalable• Scalable to suit projects of different risk levels• The higher the risk the more rigorous the
process• Risk
– Cost– Potential payoff– Strategic impact– Uncertainty – uniqueness, unknowns
Needs vs Features• A Focus on Features:
Identifies today’s dominant product
• A Focus on Needs: Leads to tomorrows dominant product
Market Driven• Builds in Voice of
Customer• Loops back to the
customer• Homework upfront• Poker game
Spiral Development:“Build-Test-Feedback-Revise” Loops
Build Business Case
Gate 2
Stage 2
Stage 3 - Development
Stage 4Gate 3
Gate 4
Testing & Validation
VoC User Needs & Wants
Full Proposed Concept
TestRapid-proto &
Test
1st-proto & Test
Next proto &
Test
Field Trail Beta Test
Selecting the Right Projects• Encourage many ideas• Focus on the winners• Do your homework• Talk to the customers and LISTEN• Secure resources• One stage at a time• Strategic portfolio management
What stage-gate is NOT
• Not a functional review system
• Not a rigid system
• Not a bureaucratic system – streamlined
• Not the same as project management
Implementing a new process• Stage 1 - Defining
– Executive buy-in– Task force– Current process audit– Workshop – problem detection– Benchmarking
• Stage 2 - Designing– Training session– Rounds with feedback– Iterations with management and users
Implementing a new process
Stage 3 – Implementation– Training– Internal marketing – buy-in– Bringing Projects into the Process– A process owner– Documentation– IT Support
June 07
Thank-you