There is nothing more black art
In the past days, the practice of innovation and the development of products, processes, or services in commercial organizations was a black art by marketers, engineers, or scientific researchers ... depending on the industry. There was no fixed method for doing this work, or the formal methods that existed were the property of the company or even the company website!
Everyone was more or less free to pursue their creative “instincts”, and this is very well suited to many people, some even claim that by definition you cannot structure what is essentially a creative matter.
Although there is some truth in this statement, global competition, price pressure, and regulatory requirements have come together to compel many commercial organizations, especially in rapidly changing or capital-intensive business environments, to rethink their practice in this area as their very survival!
Capital-intensive organizations, such as developing new aircraft, automobiles, microchips, and ethical pharmaceuticals, can no longer afford to embark on new developments that were not strictly managed because the cost of failure or non-compliance was too high.
Similarly, consumer products, such as food and beverages, consumer electronics, clothing, and entertainment, are experiencing changes in technology and / or consumer preferences, which means they have to become very organized to avoid the risk of developing the year and # 39; the product. Practices such as:
• Time to trade
• Design cost and
• Customize to order
in combination with:
• rate of technological change
• opening up global markets and labor
• increase in the number of clients; energy and cost expectations and
• expansion / change of regulation modes
to make companies become smarter, more compact and more productive to stay in the game!
Many leading commercial organizations have found that they can not only structure their innovation and development processes, but also that they become better, faster ..... and better ..... more predictable results from this.
Framework for Innovation and Development (I & D)
If you cancel the organization-specific adaptation, and many of the tools and methods that slang and buzzwords can hide the big picture, the overall structure appears.
You can see a lot of variations of this basic structure deployed in leading commercial organizations, some of which seem unrecognizable, but if you dig the surface, most of them have many common elements with what is stated here ..... as a rule, just organized differently according to their specific needs.
One of the strengths of this universal concept of innovation and development is that it reflects good or advanced practices from different industries and can be easily adapted and customized to meet specific needs in different companies and sectors ... . Regardless of whether they are primarily revenues, cost reduction or compliance!
Four main components
Four main components underpin the innovation and product development framework:
Strategic alignment
This is a means of interpreting the vision and strategic goals in broad areas with which you can focus investments on innovation and product development - taking into account industry and market trends, growth requirements, changes in statutory conditions, etc.
An important part of this is the allocation of funds and other resources to these broad areas of interest in coarse proportion to their promise or importance.
Management of ideas
This means of systematically collecting ideas for innovation, big and small, from people in all layers of the organization - from customers, suppliers and partners of the organization, as well as from the market as a whole, whether its source is consumer or competitor,
And then the ability to store, retrieve, filter and synthesize them as needed as another potential source of innovative ideas ... people hired by the organization specifically for innovation & 39; don't have a monopoly on good ideas!
Innovation and Development (I & D) Process and Indicators
This process is structured and often based on variations of the “Stage-Gate” & # 39; model. It represents the logical progress of the steps by which product ideas must flow from their concept into their production or execution.
The model starts with the potential (if necessary / suitable) for exploring cutting-edge new ideas, joint venture development partners, proposed regulatory regimes, or key technologies with a long lead time and high internal risks.
This first step ensures that, if and when it is needed, the organization already has some familiarity with both the benefits and the risks, and may consider whether their deployment will meet the needs.
From this point on, regardless of whether the idea was taken from an incubator, abandoned the process of managing the idea, the result of brainstorming or in the classic moment of inspiration, each stage then determines, justifies, develops, develops and analyzes the idea in until At the end of the process, there will be no complete, ready-to-market, normative and economically viable product available for production or execution.
Of course, not all product ideas can provide the desired results, which include Gates between each stage.
Gates sits on logical control points in the I & D process, usually when it is planned to publish new information about a product or market environment (for example, new cost estimates, forecasts or regulatory impact assessments), at some point in the product & # (For example, focus group , preliminary compliance audit or prototype test results), etc.
In each case, the appropriate staffed one (i.e., a group that often works with cross-functional capabilities and / or includes selected external holders) meets for a meeting of the meeting (which can consider one or several products) and requires two broad product decisions.
First, is there an idea for the product to allow it to proceed to the next stage depending on its own merits, or instead requires correction or even murder. The second broad solution is related to portfolio management.
Portfolio management
This is the process of identifying meaningful categories into which products are grouped. They vary by industry, but usually revolve around the market / type of customer, type of technology, price range, regulatory period, etc.
As a rule, two different approaches to portfolio management are used, usually depending on the industry sector and the associated market dynamics.
The first trends to be used in sectors with intensive capital, which put several large bets (for example, the aerospace industry), whose failure can destroy a bank, or sectors in which changes occur so quickly that tough, time-efficient centralized decision making is a critical success factor (for example, high-tech).
This is usually a decision of the board of directors and senior management that goes beyond the strategic leveling process, and the idea of a new product is usually introduced into the portfolio at this stage before the input-output process is even properly launched.
The role in this scenario for portfolio management at the Gate meeting is to ensure that the product continues to contribute, as predicted and expected, to the product portfolio. That is, to ensure that nothing has changed, which will lead to the fact that the product will be responsible for the portfolio. This is called the "Portfolio Domination" arrangement.
The second type of portfolio management is often used by organizations operating in sectors that are somewhat less volatile and / or the cost of failure is lower. In addition, they often have to cope with a wide range of offers (for example, consumer goods).
This approach is driven by the I & D process, and in this scenario, management and senior management provide extensive management and financial budgets in the strategic leveling process, but they do not determine which specific products should be developed ..... this may be many hundreds every year in some sectors!
Therefore, the role of the Gate assembly should decide not only if the product idea has its merits and itself sounds, but also determines the timing of its entry into the portfolio, given the net impact that its access will have on the & # 39 portfolio.
It is possible that good product ideas may be suspended until market periods are correct, or they are less likely to cannibalize sales of other portfolio products, or resources for their development may be available, etc. This is indicated as " Gate dominant "agreement.
In both types of portfolio management, the overall goal is to give senior executives feedback on how well the organization’s vision and strategic goals are supported by the flow of product ideas in the development pipeline.
They can use this information to periodically correct any perceived inconsistencies, view current products or product groups in the pipeline in the light of any new information they have, or to find out if there is anything seriously at risk of becoming unstuck while it is still at the point where they can take effective corrective actions.
Obviously, it can also serve as a starting point for periodic rethinking of the organization’s vision and strategic goals.
Three supporting components
In addition to the main components, there are also three frequently used auxiliary components that are found in many approaches to this area. They can be summarized as follows:
• Personnel Management - they are important. people-oriented skills and abilities needed by any successful organization. It includes such things as leadership, teamwork, roles, RASCI matrices, organizational design, behavioral and cultural changes, communication, and staff training and education.
• Progress management - if what has been written so far causes the usual images of programs and projects, because it should ... The only difference is that things have been structured in such a way as to meet the requirements of the repeatability of I & D capacity.
This includes such issues as management, business case, program and project management, responsibility and risk management, as well as resource and financial management.
• Turn on systems and data - this final area is the heading for all systems, tools, data, etc., that are needed to implement an effective industrial-scale I & D process.
Getting benefits
Vital to all the seven components outlined on these pages is the need to stimulate dynamic collaboration (for example, within parallel engineering) across disciplines, technologies, geographic regions, companies, regulatory bodies, etc. As necessary.
Ideas, requirements, changes, problems and risks must be transferred and managed in a complex way between the right stakeholder group at the right time!
In the framework of the development of products and developments that have been defined at present, it is possible to hang in appropriate places appropriate methods and tools that are the words of jargon and buzz mentioned earlier in this article.
Mentioning specific approaches such as TRIZ, Design for Production / Delay, Rapid Prototyping, Deployment of Quality Functionality (QFD) and Experimental Design need to be listed, but some of them.
A warning note should be voiced at this stage - this structure can also be easily adapted. For example:
• Formation of a bureaucracy / artisanal mechanism, where people feed process data without knowing why, or
• forcing all projects, large and small, risky and trivial in the same way, where there must be several paths of different strengths to meet the needs of different types of products in development and related investment and risk profiles or
• do not protect carefully which people, from which parts of the organization and / or groups (groups) of interested parties are indicated the roles in the process ... this is often a particularly painful pain in terms of the effectiveness of the process and predictability of its results!
However, if the structure is well implemented and includes the necessary training for those who need to work with it, it can be a powerful competitive weapon. Awards may include:
• the ability to quickly, reliably and predictably / consistently deliver new or improved products.
• Improved success rate with new developments - although none of this guarantees that the product, after its development, will be successful in the market. But there will be several product concepts that will not be able to see the light of the day even after much has been spent on their development.
And statistics also show that organizations that consistently apply a process such as that described in this article, in fact, also achieve higher market success than those who do not.
This should not be surprising, since the very essence of the process outlined here is to apply the basic principle of increasing investments only if the risks associated with it decrease due to greater and better knowledge.
This is achieved through thorough market research, identifying facility opportunities, business case justifications, regulatory implications and other good practices. Everyone is working at the right time and in the right order, right up until the launch of a fully developed new or upgraded product.
Activating a standardized, repeatable and well-understood mechanism for innovation and product development can help organize innovation in tap & how it was!
