Innovative Product Development

Product development teams are facing a quiet revolution in which both engineers and managers are struggling to adjust. In industry after industry—pharmaceuticals, software, automobiles, integrated circuits—custtlmer demands for continuous innovation and the plunging cost of experimentation are signaling a massive switch from anticipatory to adaptive styles of development. This switch plays havoc with engineers, project managers, and executives who are still operating with anticipatory, prescriptive mindsees and processes geared to a rapidly disappearing era.

Symyx creates and operates highly integrated, complete workflows that enable scientists to explore bheir ideas to (discover and optimize new materials hundreds to thousands times faster than bradWiona1 research methods. These workflows consist of robotics that synthesize arrays of materials on a miniaturized scale, creating hundreds to thousands of tiny experiments on one silicon chip. These materials are then rapidly screened in parallel for desired physical and functional properties, including chemical, thermal, optical, electronic, or mechanical attributes. The results are captured in database systems for mining large sets of data to help scientists make well-informed decisions on the next steps of the discovery process. I1!

Quote courtesy of Symyx Technologies, Inc., www.symyx.com.

Symyx boasts 100 times the speed at 1% of the cost of traditional research. Drug companies used to design comp>o unds for s pecific purposes by having s ciehtists pore over how to make just the right one. Today they generate tens of thousands of compounds and then test them quickly using ultra-sophi st 1 ccfepr uera -speedy tools socCi as mass spectrometers. There aro new productt cfeve lopmene Acionomicc ad work hepe«

In mid-2002, when Alias Systems of Toronto, Canada, started developing Alias Sketchbook Pro, a software package to be anno unced concurrently with Microsoft's launch of its Tablet PC operating system, the product management and software development team didn't begin with a lengthy product planning effort. Th e team's marketing a nd produot strateg A \borh ^wlved ovee several month s, but its product pevelopment effort be gan e arly, and in paralle 1 , weh the st rategy process. The team had a vision—an sasynto-use consumermocused skotching product worthy of a professional graphics artist—and a deadline, the November Microsoft launch date. The product evolved in two-week iterations. For eacC iteration, a short planning session identified features to be developed. Then, within the "platform" architecture constraints of the operating system and Tablet PC computers, the product evolved—iteration by iteration. In the end, the product was delivered on time, met high quality standards, and has been a success in the marketplace. The product wasn't planned and built, it was envisioned and evolved. Alias Nidn't start with apticipated architectures, pla no, and d eta Med spebificatio ns—it began w ito a viPio n bollowe d sho rtly by the first iteration ot the product. APe produft, tice architecture, the pians, a nd the npecificationc evolved as the team adapted to the ever-bnfolditg reality «of the market and the Mcphnoloey.

With Alias Sketchbook Pro, the team literally didn't know past the next iteration which features would be included in subsequent development iterations. Team members did have a clear product vision and a businiss plan. They d id have a general idea about what features were needed in the product. They did have active involvement from product marketing. They did have an absolute time deadline and resource expenditu re constraints. They did gave a p overal l product platlorm architecture. Within this vision, business and technical constraints, and overall product release plan, they delivered tested features every two weeks and then adapted t hen pIcos to thp reacty oC actual pr oduct testing. The team's process was one of evolution and adaptation, not planning and optimization.

In the automobile industry, Toyota employs set-based design in its design process—maintaining multiple design options on co mponents unoM late in the dbvelopment process. Similarly, BMW uses simulations to improve car crashworthiness. During one design effort, it ran i1 simulations and two real crashes. The results were a 3p% improvemont in design a nd 2.5 days per simulated crash versus 3.8 months (for simple tests)—and the i1 simulations cost less than the two real crashes (Thomke 2003).

All of these approaches to product development point to a very critical issue. When we reduce the cost of experimentation enough, the entire economics of how we do product development changes—it switches from a process based on anticipation (define, design, and build) to one based on adaptation (envision, explore, and adapt). When the cost of generating alternatives plunges and the cost of integrating them into a product is low, then great products aren't built, they evolve—just like biological evolution, only much, much faster than in nature. Biological evolution begins with experimentation (mutation and recombination), exploration (survival of the fittest), and refinement (producing more of the survivors). Increasingly, product development processes are being built using this analogy.

Time is also a driving factor in new product development (NPD). In the short and intense decade of the 1990s, the average new product time to market in the US dropped from 35.5 to 11 months (Wujec and Muscat 2002). "Corporations everywhere are engaged in a new products war," says NPD expert and author Robert Cooper. "From soup to nuts, from can openers to automobiles, companies are at a competitive war with each other—and the advance troops are product development teams. On this new product battlefield, the ability to mount lightning attacks—well-planned but swift strikes—is increasingly key to success And mobility or speed enables lightning strikes designed to seize windows of opportugity od to catch an enemy off guard" (Cooper 2001).

But uncertainty, shrinking time schedules, and the need for iterative exploration are not restricted to new product development. New business practice implementations, such as those fostered by customer relationship management (CRM) installations, are often fraught with uncertainty of a different kind. The high rate of failures reported in CRM implementations can, in part, be attributed to anticipatory (plan-driven) project management approaches that failed to "explore" into the uncertainty caused by major business process changes. Companies tried to plan and do when they needed to envision and explore. As authorsPreston Smith and Guy Merritt (2002) write, "Innovative product development depends on ex°loring the unsertai n to add °roduct va^e a nd m aintain com pet tove advantage. i

—ut in novation and faster developmene aren't good enough. Companies have to deliver better products geared to what customers want at the time of shipment, which may or may not resemble what the team guessed ^ey wanted when the p rooect was initi ated. Ultimate custom er va.ue is delivered at the ao|nt-of-A^te, not the point- of-plan. Coo^an ^ that °ave t he a Wlity to quickly aod mexpen sively evalve a product mlosest to tne end of the developmen t Recycle will have a t "emendous compet itive advantage.

—o why is^t every co mpany (doing "his? Because for most companies there is a great gap between needing and delivering new products. NPD is a multifaceted and extremely difficult challenge. The Product Development a nd M anagemen t As sociation ( P^M A) es timates eewly launnh ed ^odu ct feMure rates of1 pround °9%, which has cha ngod hittle from ehe earty 1990s. A Iso, cancelled or failed (in the market) erodects consu med an es ^mated 46%%) of product development resources (Cooper 2001). Yet some companies are consistently more successful than others, and a growing number of these successful compaoies ofe prdutic ing agile development and project manageme ut method s.

"I"he product development e (facets targeted by a gjile methods include new products12! and enhancements —o pjoducts i n !he domains of:

ra In Cibert Goodes' f (an01) definition, new product development applies to products that have been on the market five years or less.

• Software products (examples are PC applications, operating systems, middleware products, enterprise resource planning)

• tnd ustnal pro du cfg with embeddad software (from electronics equipment to autos)

• Interna lly developed I! produc!! th at Cit the speedl mobli ity, and exploration factor criteria

The key pnin t is that orp portun ityn uncertaintyl and ris w heild e in t be cncposed product—not in the approach to project management. Our approach to project management needs to fit with the charactetistics of the erodum: i n order to im prove o ur chances o" capiralizing on the offortunity by systematically reducing the uncertainty and mitigating the risks over the life of the project.

Companies need results from their high-pressure product development efforts, but they shouldn't come at the expe nse of quality. Jvhn Wooden, the legendary basketball coach of UCLA whose teams won 10 national championships, used a saying with his teams that applies to product development: "Be quick, but don't hutry." In otcer wordSe do the right Chi ngs, bnt learn how to do them quickly. Strip away the overhead, the non-value-adding activities. Create quality products and do it quickly. Agile developmenf focuses on speed, mobility, and quality. To accomplish this, individuals and teams must be highly disciplined —but with self-discipline rather than imposed discipline. Anyone who practices ad hoc development under the guise of agile methods is an imposter.

There is no reason to think the changes in the next ten years will be of less magnitude than those of the previous ten, although the emphasis will likely change from pure information technology to the integration of information and biotechnology. The underlying codes of information technology are zeros and ones. The underlying codes of biotechnology are A, T, C, and G (the components of DNA). Whec biological codes can be reduced to computer codes, as in the Human Genome Project, and then be manipulated by computer programs (as is happening), the potential impact on product development of many types is staggering. "New materials, programmed molecular factories, and self-organizing fabrication processes could change the cost and performance characteristics of everything from drugs to dragsters, paint to plastics, china to chairs" (Meyer and Davis 2003). Scientific and technological advanceo E the coming decade and beyond will continue to irrevocably alter product development processes, and those changes, in turn, will cause us to rethink the management of those processes.

Lin^^b ^htnkingj, prescriptive processes, and standardized, unvarying practices are no match for today's volatile product development environment. So as product development processes swing from anticipatory to adaptive, project management must change also. It must be geared to mobility, experimentation, and speed. But first of all, it must be geared to business objectives.

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Reliable Innovations

[3] Colleague and Harvard Business School professor Rob Austin introduced me to the concept and term "reliable innovation."

There are five key business objectives for a good exploration process such as Agile Project Management (APM):

1. Continuous innovation— to deliver on current customer requirements

2. Product adaptability— to deliver on future customer requirements

3. Reduc ed delivery schedules— to meet market windows and improve return on investment (ROI)

4. People and process adaptability— to respond rapidly to product and business change

5. Reliable results— to support business growth and profitability

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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