MGMT 544 Technology Management Portland State University Dr. Sharon Perot Week 7

Mgmt Week 7 2 Class #7 - Agenda Creating and Implementing a Development Strategy Housekeeping –Collect Braun Case –Mini-lecture on readings SMTI pp BREAK Case Discussion Project breakout time

Mgmt Week 7 3 Tonight’s Lecture

Mgmt Week 7 4 Creating and Implementing a Development Strategy Induced Process of Innovation –strategic action / objective of corporate strategy –innovation WITHIN a firm’s defined strategy Benefits to the firm –A “must” for continued business success “silver bullet” to leapfrog competition vehicle to enter new markets or channels –Greater leverage of existing resources –Catalyst for organizational renewal / change

Mgmt Week 7 5 Development Strategy Framework (Integration of Technology and Market in NPD) Product - Market Strategy Technology Strategy Market Assessment and Forecasting Technology Assessment and Forecasting Concept Creation and Evaluation NPD Project Plan Project Mgmt. & Execution Post-Project Learning & Improvement

Idea GenerationScreening Business Analysis DevelopmentTesting Commer- cializatio n Stages of New Product Development Project Attrition and Project Expenditures (Booz, Allen and Hamilton 1968)

Mgmt Week 7 7 Why Products Fail (or what separate winners from losers?) Winners: –differentiated product with CLEAR benefits and value to the customer –strong market orientation (especially in early predevelopment NPD phase) –early, clear product definition Losers: –no focus, too many projects, diffusion of resources –reactive, not enough homework on market –no executive sponsor, champion

Mgmt Week 7 8 Three Phases of Product Development #1 Front End Planning –How do we select our projects? #2 Project Execution –How do we manage our projects? #3 Post Project Audit and Learning –How do we improve? –Closed loop process

Mgmt Week 7 9 #1 Front End Planning for NPD Greatest leverage point for senior execs Two Approaches: –Traditional Senior Mgmt Approach Select which concepts to accept into NPD process “Go-NO Go” Decision Ownership Drawback: Execs are the knowledge experts –waste time getting execs together –waste resources “briefing” execs –Development Strategy Leadership Approach Architects of the ship, not the captains Set guidelines, boundaries, charters…”hurdle rates”

Mgmt Week 7 10 NPD Mix (Wheelwright, Clark 1992) Process Changes Product Changes

Mgmt Week 7 11 #1 Front End Planning Senior Mgmt impact the greatest (plus or minus) –Provide principles and guidelines –Project Mix Framework (need all 5 types) Recommended Procedure for Effective Leverage –Classify all existing projects into primary types –Determine cycle time and FTEs for each type –Match current resources to capacity estimates –Adjust as necessary (drop or delay projects…hire etc.) –Estimate future “roadmap” from strategic plan –Allocate resources to future roadmap and build timeline –Continually focus on productivity improvements

Mgmt Week 7 12 #2 Project Mangement Four Team Types (pg. 750, Ex. 7) –Functional ideal for projects requiring deep technical excellence –Lightweight best for derivatives and/or inexperienced teams –Heavyweight best for new platform or next generation –Autonomous most common in start-ups (tiger teams) output usually a radical or first generation product Most organizations adopt a standard approach –influenced by culture and leadership –Size and “age” of firm

Mgmt Week 7 13 #3 Post Project Learning Two fundamental problems with “post mortems” –difficult to take “result” and trace backwards to systemic issues or root causes –emphasis is often on moving on to next project…not reviewing “ancient history” Three suggestions for effective post project learning: –Senior mgmt emphasis and support of effort –create a “project audit” as a requirement for project completion –require cross-functional involvement AND strive for long-term project mgr careers

Mgmt Week 7 14 Conclusions There is no one right way to organize and lead a NPD effort: –Projects differ in scope, degree of innovation, etc. –Resources, team, processes must vary to match the project Success of project and overall NPD function depend on: –coherent vision –strong leadership –flexibility organizations

Mgmt Week 7 15

Mgmt Week 7 16 Braun Case Question #1 - Team #1: Dee, Jeff, Ellen, Dimas As Waxlax, would you go with polycarbonate or polypropylene? Would you pursue the proposed trial run, or go straight to production tools? Question #2 - Team #2 Ron,Dan, Norm and Chen, George Do you regard Braun's approach to design as a strength or a weakness in its new strategy? Question # 3. - Team #3 Brian, Josh, Ward What is your evaluation of the role of industrial design in the KF40?