Carnegie Mellon Qatar © Robert T. Monroe Course Innovative Product Development Robert Monroe January 11, 2011

Carnegie Mellon Qatar © Robert T. Monroe Course Agenda Introductions Course philosophy, structure, grading, and expectations What is innovative product development? In-class exercise

Carnegie Mellon Qatar © Robert T. Monroe Course Introductions Please introduce yourself quickly to the class –Your name –Your program, year, track or concentration(s) –Plans, goals, hopes for after graduation –Describe one or two innovative high-tech products or services that you discovered and started using in the past two years –Describe something you have designed or built that you are proud of

Carnegie Mellon Qatar © Robert T. Monroe Course Agenda Introductions Course philosophy, structure, grading, and expectations What is innovative product development? In-class exercise

Carnegie Mellon Qatar © Robert T. Monroe Course Two Big Questions 1.How does an organization bring a new product or service to market, starting with an initial idea and continuing on through product (or service) launch? –This is the product development part of the course 2.How does an organization decide which new products or services to develop and bring to market? –This is the innovation part of the course

Carnegie Mellon Qatar © Robert T. Monroe Course What Is This Course About? Creating innovative products and services that: –Solve real problems, for real people –Are useful –Are usable –Are desirable –Delight your customers Creating organizations that can uncover product opportunities and create great new products to meet those opportunities –… again, and again, and again

Carnegie Mellon Qatar © Robert T. Monroe Course Course Goals: By the End of this Course You Will: Learn a process and way of thinking about innovation Become comfortable, and effective, working at the ‘fuzzy front-end’ of the product innovation process Learn to identify and understand how broad trends and forces create product opportunities –… and how to harness those opportunities Switch from a technology-centric view of innovation to a customer-centric view of innovation

Carnegie Mellon Qatar © Robert T. Monroe Course You will understand and be able to apply: The common stages, tasks, and decision points in a new product development cycle Tools and processes for successfully navigating the early stages of new product development wherein you decide what new products and services your organization will invest in bringing to market Techniques for harnessing consumer forces as a source of new product ideas Research methods for deeply understanding the needs of product stakeholders Techniques for identifying and meeting stakeholder needs with innovative product features, capabilities, and design Tools, techniques, and processes for prototyping new products and services

Carnegie Mellon Qatar © Robert T. Monroe Course Course Philosophy Learn by doing Work together Embrace ambiguity (or at least get used to it) Have some fun Academic Integrity –Collaboration is good and encouraged … but there is an academic integrity policy –Building on other people’s work is encouraged … but failing to cite it is plagiarism

Carnegie Mellon Qatar © Robert T. Monroe Course Course Structure Administrivia –Office hours –Expectations and etiquette –Blackboard and wiki –Books, readings, and resources Grading: –Attendance, preparation, and participation 33% –Challenge problems33% –Final project / report 33% –Luck 1%

Carnegie Mellon Qatar © Robert T. Monroe Course Agenda Survey and introductions Course philosophy, structure, grading, and expectations What is innovative product development? In-class exercise

Carnegie Mellon Qatar © Robert T. Monroe Course Products, Services, and Experiences For purposes of this course, a product is a good or service offered for sale by a company. –A product may be customized for different customers but it needs to be offered for sale in substantially the same form to multiple customers. –A product may be a service, as long as the service is offered as a standard package to multiple customers –Sometimes I will use the generic term offering to refer to product/service/experience It is also possible for a company to offer a product that is fundamentally an experience. As long as the experience is available in a standard package or form and repeatedly offered to multiple customers

Carnegie Mellon Qatar © Robert T. Monroe Course Are These Products, Services, or Experiences? A laptop computer A car An oil change at a car dealer Renting a bicycle to tour around a foreign city A book that describes best practices for organizational change management Hiring a consultant to advise your company on organizational change management. –The consultants are paid based on hours worked An adventure outfitter that leads treks to Mt. Everest A hotel room and dinner at the Ritz-Carleton hotel

Carnegie Mellon Qatar © Robert T. Monroe Course How Does Product, Service Or Experience Change: Developing your offering? Producing your offering? Delivering your offering to customers? Marketing and selling your offering? –Pricing your offering Does an offering need to be only one of product/service/experience? If not, should it be?

Carnegie Mellon Qatar © Robert T. Monroe Course Launch * The Cagan and Vogel Innovation Process Realize Conceptualize UnderstandIdentify * The launch stage is not part of the Cagan / Vogel process but it is something we will explore

Carnegie Mellon Qatar © Robert T. Monroe Course Phase 1: Identify The Opportunity Goals: –Identify and evaluate a set of promising Product Opportunity Gaps (POG’s) –Choose the most appropriate POG to move forward with Primary results: –Product opportunity statement (hypothesis) –Initial scenario that illustrates the opportunity Methods –Brainstorming, observing, researching Social, Economic, and Technology (SET) factors –Generating POGs based on SET factors –Evaluating and filtering POG ideas generated –Scenario generation, feedback, and refinement Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5. Launch * Realize Conceptualize UnderstandIdentify

Carnegie Mellon Qatar © Robert T. Monroe Course Phase 2: Understand The Opportunity Goals: –Much deeper understanding of customer and customer’s Value Opportunities (VO’s), translated into product criteria Results: –In-depth understanding of the customer/user, captured through refined customer scenarios and VOA’s –List of product characteristics and constraints Methods –Primary research: observe, interview, listen, task analysis, stakeholder analysis –Secondary research: human factors, lifestyle reference, dive deeper on SET factor changes Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5. Launch * Realize Conceptualize UnderstandIdentify

Carnegie Mellon Qatar © Robert T. Monroe Course Phase 3: Conceptualize The Opportunity Goals: –Turn Value Opportunities into product concepts that are perceived as useful, usable, and desirable –Generate many concepts, evaluate, refine, iterate, reduce to a single concept to move to stage 4 Results: –Clearly articulated product concept –Clear market definition –Visual, and/or physical prototypes that can be shown to and evaluated by potential customers –Demonstration or belief that product is technically feasible Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5. Launch * Realize Conceptualize UnderstandIdentify

Carnegie Mellon Qatar © Robert T. Monroe Course Phase 4: Realize The Opportunity Goals: –Develop product or service – move from prototype to product –Complete marketing plan, financing, initial production, etc. –Product or service is ready to be sold to customers Results: –Production processes defined –Go to market plan completed (marketing, positioning, etc.) –Sales channels lined up –Placement and contracts with distributors, retailers, etc. negotiated Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5. Launch * Realize Conceptualize UnderstandIdentify

Carnegie Mellon Qatar © Robert T. Monroe Course Phase 5: Launch the Product Goals: –Deliver the product or service to customers –Start generating revenue –Ramp up production –Support organization is up and running Results: –Product or service offering is available to customers –Distribution channels functioning –Sales lead to inbound cash flow Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5. Launch * Realize Conceptualize UnderstandIdentify

Carnegie Mellon Qatar © Robert T. Monroe Course Agenda Survey and introductions Course philosophy, structure, grading, and expectations What is high-tech product innovation? In-class exercise

Carnegie Mellon Qatar © Robert T. Monroe Course Exercise – Discuss, Evaluate, Be Prepared To Present: Each 2-3 person group selects a product or service from the list Describe the product or service. What is it or what does it do?Who are its primary customers and consumers? What was/were the fundamental innovation(s) that drove the success of the product? Were the fundamental innovations ‘high- tech’ or ‘low-tech’? What role did context (time, place, opportunity) play? Had similar previous efforts failed? Why? Why did this one work? Is the innovation obvious in retrospect? Has the innovativion provided or supported a dominant industry position for the inventor? Why or why not?

Carnegie Mellon Qatar © Robert T. Monroe Course Innovations To Evaluate Apple iPad Google keyword advertising Al Jazeeera News Network (Arabic and/or English) Wikipedia Toyota Prius Liquified Natural Gas (LNG) Anti-lock braking systems for cars Aramex shipping service Nintendo Wii Garmin handheld / automotive GPS systems

Carnegie Mellon Qatar © Robert T. Monroe Course Wrap Up

Carnegie Mellon Qatar © Robert T. Monroe Course For Thursday Thursday we will look into some standard processes for developing innovative products and services and bringing them to market Come prepared to apply the concepts in the readings in class discussions and an in-class exercise