Exemplary Quality of Execution

A common theme throughout the Stage-Gate process is the emphasis on quality of execution: doing it right the first time. The argument that the proponents of Total Quality Management make is this: The definition of quality is precise: It means meeting all the requirements all the time. It is based on the principle that all work is a process. It focuses on improving business processes to eliminate errors.10 The concept is perfectly logical and essentially simple, and the same logic can be applied to new product development.

A quality-of-execution crisis exists, however, in the product innovation process. Figure 7.1-4 shows assessments of sample activities from idea generation through to the postlaunch review. Note how poorly most are executed (the gray bars). For example, only 19 percent of businesses undertake effective idea generation, only 18 percent do a first-rate job on the market research, and only 26 percent do business case development well.11 Note also how much better the top-performing businesses execute these activities (the black versus white bars). For example, 57 percent of top-performing businesses do excellent market research in new product projects; by contrast, only 23 percent of poor performers do excellent market research. Similar differences are noted for most of the activities in the figure.

figure 7.1-4 Quality of Execution of Key Activities: Impact on Performance

Idea generation Technical assessment Operations assessment Market research (including VoC) Building business case Design and development of product Production/Operations start-up Market launch Postlaunch review

"123/1

"143 J

I I Worst Performers I I Average Business I I Best Performers

I I Worst Performers I I Average Business I I Best Performers

"124.0%

0% 10% 20% 30% 40% 50% 60% 70% 80% Percent of Businesses That Execute Each Activity Well

0% 10% 20% 30% 40% 50% 60% 70% 80% Percent of Businesses That Execute Each Activity Well

Note: This shows that 19 percent of businesses do an excellent job on idea generation. This is a key but weak activity. Note diat 37.9 percent of best performers (and only 11.5 percent of poor performers) handle idea generation proficiently.

Source: American Productivity and Quality Center, New Product Development Best Practices Study: What Distinguishes the Top Performers (Houston: American Productivity and Quality Center, 2002).

Clearly there is a need for a more systematic and quality approach to the way firms conceive, develop, and launch new products. The way to deal with the quality-of-execution problem is to visualize product innovation as a process and apply process management and quality management techniques to this process. Note that any process in business can be managed, and managed with a view to quality. Get the details of the process right, practice discipline to the process, and the result will be a high-quality output.

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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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