pdma process stagegate

New Product Process

Business Strategy and New Product

Strategy

STAGE-GATE MODEL

Portfolio Management & Stage-Gate Model

Stage

Gate

Stage

Gate

Stage

Gate

Portfolio Review:

This meeting• identifies strategic imperatives• checks project priorities• checks for portfolio balance• makes adjustments to the gating model

List of projects: Active and On-HoldTotal Project Scores from Gates

Strategic Imperatives(Must Do Now)Prioritization Adjustments

Gate AdjustmentsReview

Product Delivery Process

1

PRELIMINARYINVESTIGATION

STAGE

2

SECONDSCREEN

(Feasibility)

GATE2

DETAILEDINVESTIGATION

(Build Business Case)

STAGE

3

DECISION ON BUSINESS

CASE(Money Gate)

GATE3

DEVELOPMENT

STAGE

4

POST-DEVREVIEW

GATE

4

TESTING &VALIDATION

STAGE

5

PRE-LAUNCH BUSINESS ANALYSIS

GATE5

FULL PRODUCTION& LAUNCH

STAGEPOST IMPLEMENTATION

REVIEW

1

INITIALSCREEN

GATE

Goals

#1 Quality of Execution

focus on completeness: key activities central to success are carried out

focus on quality: execution of activities is proficient

focus on the important: devote attention & resources to pivotal and potentially weak steps (up-front and market-oriented activities)

Goals

#2 Sharper Focus, Project Prioritization

focus on funnels, not tunnels: strong gates weed out weak projects

focus on using resources efficiently: resources are directed toward the truly meritorious projects

Goals

#3 A Strong Market OrientationKey marketing activities:

Preliminary market assessment Market research to determine user needs and

wants Competitive analysis Value-in-use analysis Concept testing Customer reaction & feedback User tests & field trials Test market or trial sell Market Launch based on marketing plan

Goals

#4 Fact-Based Product Definition

up-front homework: defines the product and builds the business case for Development

fully defined products: lead to strong first steps into becoming full-fledged development projects

strategic product platforms: creates comprehensive product links to insure long-term idea pipelines

Goals

#5 Fast-Paced Parallel Processing

relay race approach ends: the series approach moves to the rugby match style of concurrently occurring activities

benefits of team work: • more work gets done in an elapsed time period• less chance of an activity being overlooked• activities are designed to feed each other• process becomes cross-functional and

multidisciplinary

Goals

#6 True Cross-Functional Team Approach

Key ingredients: Committed team players Team leader accountable for the project Leader w/formal authority Fluid team structure, w/new members added or

dropped as work requirements demand-some may not be involved in all

Small, core group of responsible and accountable team players from beginning to end

Goals

#7 Products with Competitive Advantage

Defined as: Differentiated products Unique benefits Superior value for the customer

Product superiority should be built in at every opportunity, questioned at every Gate, and a key deliverable for Go/Kill reviews

Goals

#8 A Fast-Paced and Flexible Process

elimination of time wasters: work that adds no value to the new product process only slows it down

different projects have different needs: the risks and nature of different projects should be considered - some will move faster than others

Definitions

Stage consists of a set of parallel activities by people

from different functional groups designed to gather information needed to advance

project to next gate each is cross-functional and owned by no single

functional group designed to help manage risk by driving

uncertainties down at each successive stage in general, each stage costs more than the

preceding one due to successive commitment to launch

Gate have a set of required “deliverables” the project

leader must present to the gate have a set of “criteria or hurdles” that each project

is judged on have a decision or “output” - Go/Kill/Hold/Recycle

DELIVERABLESCRITERIA

OUTPUTS

Definitions

Definitions

Gatekeepers management team of decision makers and

resource owners responsible for facilitating the rapid commercialization of selected projects

TI - Managers; Newspaper - Directors after Gate 2 or 3 forward

Deliverables a prescribed list of items - results of completed

actions - the Project leader must present to the gate based on a standard menu for each gate & are

decided at the output of the previous gate

Definitions

Criteria/Hurdles a predetermined set of hurdles or questions that

the project is judged on to make Go/Kill and prioritization decisions

can include a list of must-meet or knockout questions to weed out misfit projects quickly

e.g., Does the project fit the corporate strategy? Is there consumer appeal - that is, clear consumer need and expectation of consumer benefit? Is manufacturing or procurement feasible?

Definitions

Outputs a decision (Go/Kill/Hold/Recycle) an approved action plan for the next stage a list of deliverables date for the next gate

Action plan estimate of people required estimated money and person-days budget time schedule

Idea Generation

Keys to success focal point for new ideas: assign the responsibility

of generating and handling ideas to a single person identify the sources: where do good ideas come

from - make a list of possible sources and follow up

grease the path: create events or opportunities for idea generation - kits, contests, conversations

capture & handling system: allow for easy submission points and forms, with a repository for ideas not accepted

Idea Capture & Handling

IDEAS

FOCAL PERSON

PERIODIC REVIEW & UP-

DATE

1

INITIALSCREEN

GATE

FEEDBACK TO SUBMITTER

1

STAGE

IDEA VAULT OR BANK

- IDEAS ON HOLD- “DEAD” IDEAS

OTHERS IN COMPANY

Idea Generation

Idea Capture & Handling

Idea Generation

SUBMISSION DATABASE(Excel Spreadsheet online)

- NEW IDEAS

www.tribuneinteractive.net/ideaorama

http://www.tribuneinteractive.net/ideaorama

http://www.tribuneinteractive.net/ideaorama

Gate 1Initial Screen

Characteristics

project is born: first decision to commit resources to the project

“gentle screen”: project is subjected to key must-meet and should-meet criteria

financials: financial criteria are typically not part of this first screen

checklists & scoring: Yes/No criteria for the must-meet, and a weighted rating scale for should-meet criteria

1


STAGE1

INITIALSCREEN

GATE

Gate 1Initial Screen

Criteria/Hurdles

A single “NO” kills the project:• Strategic fit - does it fit w/in a market or functionality area

that’s one of strategic focus?• Market attractiveness - are the market size, growth, and

opportunities attractive?• Technical feasibility - is there the likelihood that the

product can be made & produced?• Killer variables - do no known killer variables exist (e.g.,

legislative action)

1


STAGE1

INITIALSCREEN

GATE

Stage 1Preliminary Investigation

Objective - Determine the project’s technical and marketplace merits

Activities (primarily secondary research)• Preliminary market assessment - scoping of the marketplace to

assess the existence of a market, probable size, and market acceptance

• Preliminary technical assessment - appraisal to propose a solution, a probable route, and assess costs, time and risk

• Preliminary business assessment - quick financial assessment based on estimates of sales, costs, and investment required

(payback calculation)

1


STAGE1

INITIALSCREEN

GATE

2

SECONDSCREEN

GATE

Gate 2 “Feasibility”

Characteristics

repeat of Gate 1: project is reevaluated in light of the “deliverables” from Stage 1

hurdles using Hoeschst’s scoring model: the addition of more complex metrics can help evaluate projects in Gates 2 & 3

financial return assessed: this is quick and simple financial calculation meant only to give a general understanding of payback period, costs, etc.

2


STAGE

1


STAGE2

SECONDSCREEN

GATE

Criteria/Hurdles Strategy & Priorities

• Does the project fit the corporate strategy? (M)• Does the project fit the category strategy? (M)• Does the project fit the operating unit strategy? (M)

The Consumer• Is there consumer appeal (that is, clear consumer need and

expectation of consumer benefit)? (S)• Is the market/category of an attractive size and with growth potential?

(M)• Does the concept have competitive advantage? (M)• Is there a clear and viable marketing proposition? (S)

2


STAGE

1


STAGE2

SECONDSCREEN

GATE


Criteria/Hurdles (cont’d)

The Sale• Are there existing company sales channels? (M)• Does the product have advertiser appeal and fit? (S)

Technical• Is development or procurement feasible? (S)

Editorial• Are there any serious issues - legal? (M)• Issues - ethics? (M)

2


STAGE

1


STAGE2

SECONDSCREEN

GATE


Gate 2“Feasibility”

Criteria/Hurdles (cont’d) Financial

• Does this project have a PMA/DMA/national potential? (S)• Are financial projections in line with financial criteria? (S)

Other• Does the product have multi-market expansion potential? (S)

M= must-meetS = should-meet (Hoescht scale)

2


STAGE

1


STAGE2

SECONDSCREEN

GATE

Stage 2 Detailed Investigation

Objective - Build the business case Activities

• User needs-and-wants studies help develop a new product definition

• Value-in-use studies determine what economic value the product will bring to the advertiser/customer (customer use system, current solution, cost drivers, etc.)

• Competitive analysis that includes direct and indirect competitors: their products, strengths & weaknesses, business performance, etc.

• Concept testing in prototype form• Detailed technical assessment• Operations appraisal• Financial analysis

2


STAGE

2

SECONDSCREEN

GATE3

DECISION ON BUSINESS CASE


Deliverables - Business Case should answer: Product definition - what is the product, who will

use it and who will it be sold to?• Specification of the target market• Description of the product concept and benefits• Positioning strategy including price point• Product features, attributes, requirements, and high-level

specs (“must have” and “would like”) Project justification - why invest in this project?

• Strategic rationale, financial analysis, and business risk assessment

Project plan - how and how long?

2


STAGE

2

SECONDSCREEN

GATE3



2


STAGE

2

SECONDSCREEN

GATE3


Sample Deliverables to Gate 3 Strategic fit confirmed Detailed market assessment Detailed operations/technical assessment Resource constraints Detailed financial assessment Detailed legal and ethical issues assessment Potential killer variables addressed Critical success factors are understood and feasible to achieve Recommendation to proceed, hold or kill Detailed biz & project plans High-level plan for remaining stages

A complete Deliverables List for each Gate can be found at: www.tribuneinteractive.net/stagegate Choose: DeliverablesList.doc

Gate 3“Go-to-Development”

Characteristics

money gate: final gate prior to the Development stage - the last point at which the project can be killed before entering heavy spending

product definition sign-off: what the product is to become and how it fits into the product portfolio are finalized

gatekeepers: top-level management

2


STAGE

3


3

DEVELOPMENT

STAGE

Gate 3“Go-to-Development”

Criteria/Hurdles Similar to Gate 2, however, are more rigorously applied, using

more quantitative methods if necessary in addition to “must-meet” and “should-meet” standards outlined in Gate 2

The list of hurdles for this gate should be determined by the business unit based on a criteria that allows the gatekeepers to make an informed allocation of funds to Stage 3 (Development)

2


STAGE

3


3

DEVELOPMENT

STAGE

Stage 3Development

Characteristics Deliverable is a “lab-tested” product, w/full

production & marketing plans being developed here

Development plan includes• chronological list of activities, actions, and tasks

(project management)• a timeline or schedule showing beginning & end

points, and milestones• resources required for each task and assigned

responsibility

3


3

DEVELOPMENT

STAGE

4

POST DEVELOPMENT

REVIEW

Gate 4Post Development Review

Characteristics A check on the progress and continued

attractiveness of the product and project Question switches from “Should we invest in the

project?” to “How well is the project unfolding - is it on track?”

Go/Kill criteria/hurdles in both Gates 4 & 5 should reflect this shift

Test or validation plans and capital expenditures should be approved here

Marketing and operations plans are reviewed for future execution

3

DEVELOPMENT

STAGE

4

POST DEVELOPMENT

REVIEW

4

TESTING & VALIDATION

STAGE

Stage 4Testing and Validation

Characteristics Tests and validates the entire commercial viability

of the project: the product itself, the production process, customer acceptance, and the economics

• in-house prototype testing• user tests or field trials• limited pilot production• financial revisions• mini-launch

4

POST DEVELOPMENT

REVIEW

4


STAGE

5

PRE-COMMERCIALIZAT

ION BUSINESS ANALYSIS

Gate 5Pre-launch Business Analysis

Characteristics Scrutinizes the quality of the activities at the

testing and validation stage and their results Criteria/hurdles tend to focus on expected financial

returns and appropriateness of launch and operations start-up plans

Operations and marketing plans reviewed and approved

Life Cycle plan anticipated

4

POST DEVELOPMENTREVIEW

STAGE

5

PRE-COMMERCIALIZATION BUSINESS ANALYSIS

5

FULL PRODUCTION& LAUNCH

STAGE

Stage 5Full Production & Market LaunchCharacteristics

Implementation of both the marketing launch plan and production or operations plans

Post-Launch monitoring plan kicks in with performance on key metrics being tracked

Elements of the long-term Life Cycle Plan begin to be implemented

(e.g., improvements and variations)

5

PRE-COMMERCIALIZATION BUSINESS ANALYSIS

5

Production &Market Launch

STAGE

POST IMPLEMENTATION

REVIEW

Post Implementation Review

Characteristics After about 6 to 18 months the product project must

be terminated - product becomes part of the company’s portfolio

Product’s performance is tracked, analyzed, and assessed - in terms of costs, revenue against projections, profits, timing against other products, etc.

Project team and the leader remain accountable for the success of the project through this post-Launch period

5


STAGE

POST IMPLEMENTATION

REVIEW