Stage Gate Ideato Launch Framework for Driving New Products to Market

Robert Q. Cooper

New products are critical for the survival and prosperity of the modern corporation. New products launched in the previous three years now account for about 40 percent of companies' sales revenues and are seen as a major instrument of company growth. Innovation is no longer an optional investment, according to a recent executive survey: almost half of senior executives rate innovation as "very critical" to their future business success.1

The term new product is defined as anything that the organization offers to its marketplace for use or consumption and is new to the selling organization—that is, something it had not previously sold or made. This definition includes tangible goods as well as service products.

Product innovation is not so easy, however. Indeed, new products fail at an alarming rate (about one in ten new product concepts

This chapter is taken from two books by the author: Product Leadership: Pathways to Profitable Innovation, 2nd edition (Reading, Mass.: Perseus Books, 2005), and Winning at New Products: Accelerating the Process from Idea to Launch, 3rd ed. (Reading, Mass: Perseus Books, 2001). It also draws on other writings by the author: "Doing It Right—Winning with New Products," Ivey Business Journal, July-Aug. 2000, pp. 54-60; "Stage-Gate New Product Development Processes: A Game Plan from Idea to Launch," in E. Verzuh (ed.), The Portable MBA in Project Management (New York: Wiley, 2003); and even earlier publications such as "Stage-Gate Systems: A New Tool for Managing New Products," Business Horizons, 1990, 33(3).

Stage-Gate® is a registered trademark of Product Development Institute, Inc.

succeeds); 44 percent of new product projects fail to meet their profit objectives, and 49 percent are launched late to market.2 Thus, many senior managers seek ways to improve their new product success, profitability, and speed to market and to build best practices into their product innovation methodology.

A Stage-Gate® framework is one solution that many leading companies have adopted to drive new product projects to market quickly and effectively.3 The analogy of a North American football game helps to explain the concept. Imagine a football team without a game plan. The coach urges his players to "go out there and play hard . . . play to win." These are wonderful words of encouragement, but without a playbook or game plan, there's likely to be chaos on the football field.

A Stage-Gate new product process or idea-to-launch framework is simply a playbook or game plan to guide new product projects from beginning to end. In this chapter, we look at what a Stage-Gate framework is and then at ten best practices that top-performing businesses have built into their frameworks or playbooks. The chapter also provides the details of a best-in-class Stage-Gate idea-to-launch framework via a walk through the process. And the chapter ends with a look at how Stage-Gate methods have been applied to other types of development projects and some tips on how to implement Stage-Gate.

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