In our last newsletter we introduced the concept of tuning your new product development process.  We detailed the advantages of a new product development advocate and a standing committee.  Stated differently, for an effective new product development process, a business needs a single person to drive the process as champion, mentor and coach, but remain accountable to a group of peers representing the various disciplines in the organization.

Now in Part Two of this newsletter, we will continue to advance through the new product development process.  Again we will use our experience working with Bacharach, Inc and its VP of New Product Development, Doug Keesport.

In our previous newsletter we wrote about the Phase-Gate new product development (NPD) process as practiced by General Electric.  For the purposes of this newsletter, we will focus on tactically tuning your NPD process, not re-inventing it.  For more information about the Phase-Gate process, click here (Wikipedia link), or contact us by email or phone.

Pre-Gate Filters

All ideas are acceptable in a brain storming session.  However this is not the case in new product development.  If every new product idea moved forward, the organization would close down.

In Phase I, Market Research, a product/market need is an identified, confirmed and a detailed report prepared to document the opportunity. It then moves to Phase II, Concept Design.  However, in “the heat of battle” the phone rings and the sales department suggests yet another winner to work on immediately!  The marketing department replies with an email blast saying “get in line, take a number!”  The sales department hits “reply all” and states, “You do not understand the incredible opportunity we have to move into this new product application, please reconsider!”  Instituting a pre-gate filter with strict criteria before Phase I can help prevent churn.  Market research is conducted to help justify the opportunity, and place it in perspective.  In our work we have witnessed pre-gate lists of as many as 100 product ideas, some great, some foolish.  The challenge, of course, is to select a manageable number and investigate them first.  Pre-established criteria and rationale must justify the choices in order to focus development.

Here it is critical that the new product steering committee applies the already established criteria.  Product guidelines for line extensions are in place.  Three year sales volume level requirements are in place, as are pricing guidelines and ROI requirements. The pre-gate filter allows new product development to continue and not be interrupted. Doug told us that before the Bacharach pre-gate filter was working well, hallway conversations, personal connections, and a decentralized approach interfered with the task of maintaining a disciplined focus. We expect this is true of most businesses, especially those without the organizational DNA mentioned earlier.  Properly done, these concepts make the process of developing new products less complex and more focused on the total value instead of fulfilling the agenda of any single customer or constituency in the organization.

Simplification

Hiring freezes and staff reductions to support sales efforts have strained engineering departments’ ability to develop new products.  Heavy meeting attendance requirements, increased email volume, and the “I need it tomorrow” mindset, often rule a business culture.  Couple this with the urgency for new product speed to market introductions and intensified customer expectations on service requests, and you have stress and tension within the process.  What answer can be offered to reduce stress and tactically tune your NPD process?  Simplify!

For example, we no longer recommend a seven-phase process. Shorten it to five steps. Place greater emphasis on doing a few things well, instead of managing a portfolio of new product development projects that have not been prioritized.  Simplification also includes making more non-critical assumptions about the concept to reduce actual product development time because speed to market is so critical.

Electronic NPD Process Monitoring

All NPD tracking for everything from updates, to meeting notes, to schedules, and next steps, should be electronic, existing in your company’s intranet, extranet or wiki.  Building on the principle of simplification, Bacharach’s model ties directly with their ISO procedures.  It is a seamless system that is also paperless.

Electronic streamlining your monitoring process also enables standard templates to be used for each phase of your process.  This standardization conditions your development team and new product steering committee to ask the same questions with each new product opportunity.  Your process will have transparency and will become predictable.  Finally, with product accountability, introduction plans, and status reports all readily accessible, it now makes sense and provides the necessary focus.

Our thanks to Bacharach for their contribution to help develop these Five Tactical Tuning ideas.  We trust that some of these principles are useful and can be shared with your NPD team.

For more pointers on new product development, visit our newly refreshed website at www.crossroadsdgltd.com for past newsletters and more about Crossroads Development Group.

The siege of Vicksburg was a singularly focused activity that enabled the Union Army to concentrate a critical mass against a well-entrenched enemy force.  The surrender terms, often referred to as unconditional, delivered to the union Vicksburg, its garrison, and ordinance stores.  The successful battles fought in reaching that prize provided new spirit to the loyal people in the North and new hope for the final success of the Union’s cause.  Now the Mississippi River was entirely in Union control!

How does this relate to New Product Development, Pre-Gate Filters and Simplification, you ask?  General Grant had much on his mind and many options available to ponder and evaluate.  A siege was a fixed permanent commitment to accomplish a singularly focused objective; require Confederate General Pemberton to surrender unconditionally.  General Grant had to withstand all the pressures from his advisors on alternative options.

With the pressures of the recession and challenges you face, stay focused regarding New Product Development.