Riek, RF. (2001). From experience: Capturing hard-won NPD lessons in checklists. Journal of Product Innovation Management, 18, 301-313.

Format: Peer-reviewed article

Type: Experience

Experience level of reader: Fundamental

Annotation: Case studies examine NPD issues in three critical areas: 1) Managing technical risks; 2) Managing commercial risks; 3) Managing NPD personnel. Improving process planning and disciplined process management would avoid most of the problems discussed.

Setting(s) to which the reported activities/findings are relevant: Federal lab, Large business, Small business (less than 500 employees), University

Knowledge user(s) to whom the piece of literature may be relevant: Manufacturers, Researchers

Knowledge user level addressed by the literature: Organization

This article uses the Commercial Devices and Services version of the NtK Model

• Neglecting Risk Management: Low yields from pilot scale product demonstrations were rationalized with the proposal that the final production process design could engineer in the necessary improvements. A mistake generating severe financial penalties. Skipping development steps is a road to disaster. A launch & fix mindset increases not only costs, but also project timelines.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 7.12
• Neglecting Risk Management: To speed development time and save money, the project skipped the pilot demonstration phase of a new manufacturing process, with production designs derived from bench demonstrations, and concepts based on computer simulations only.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 7.4

• Stage 5 — Design & Development activity involves a checklist of steps and activities. See Table 4 for the checklist.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Stage 5
• Stages 2 & 4 — Plan & Specify involves a very lengthy checklist of steps and activities, covering the entire range of market, technology, manufacturing, legal and personnel issues, which reinforces the need for comprehensive multi-functional team planning. See Table 3 for the checklist.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Stage 2, Stage 4
• Stage 8 — Launch Commercialization involves several checklist items shown in Table 6.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Stage 8
• Stage 6 — Scale Up & Validate involves a checklist of steps and activities. See Table 5 for the checklist.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Stage 6

Model: NPD project teams have a tendency to get immersed in the product's underlying technology during the Development Phase, and sometimes even bypass understanding of market conditions and commercialization requirements until technical success is assured. Not addressing all three early and often leads to negative consequences in the NPD process.
Conclusions drawn from case studies and experience.
Occurrence of finding within the model: Stage 1, Stage 2, Stage 4

• Identify the purchase decision-maker within the customer stakeholder group — A full understanding of the path to market requires input from all relevant stakeholders up front, followed by close coordination among cross-functional team members downstream.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 1.5, Step 4.3
• Review the project's value proposition and product pricing estimates with potential customers early in the process. Such marketing practices can identify hidden barriers to customer adoption, such as the presence of alternative approaches to meeting the need, which exist or are already in development.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 2.3
• Recognition of technical risks in the project planning stage with a clear discussion of acceptable and unacceptable consequences, can improve methodology in the Development Phase, and the probability of achieving NPD goals.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Stage 4, Step 4.12
• Project Scope — Clear focus on the major deliverables, along with joint management and project team involvement in the creation of a solution, is critical to the generation of a good project scope.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 1.4
• Decision to kill a project — Management must be willing to abandon a technology or prototype, for any legitimate reason, including excessive manufacturing costs in terms of yield and operability.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 7
• A formal product portfolio process is useful in identifying corporate consequences of adopting a new technology, and in assessing corporate fit for any new product line considered.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 6
• One approach for resolving conflicts between competing project plans is to authorize the simultaneous pursuit of design and development activities until a clear choice emerges.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 3
• The role of senior management is to deal with strategic fit and priority, and to enable success by providing resources and guidance. Management decisions should concentrate on specifying product and process performance goals. However, the choice of technologies used to satisfy these goals in design and manufacturing should be done jointly with the NPD team.
  Conclusions drawn from case studies and experience.
• Milestone checkpoints must address not only major technical and commercial milestones, but legal and intellectual property issues as well.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 4.4
• Identification and validation of knowledge gaps requiring new research activity, requires an open discussion of technical options and choices. Both management and NPD team members require continuous coaching to establish and reinforce their responsibility to identify the intended and unintended consequences of project premises.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 3.2
• New technologies need to be screened both for market value as well as for the presence of substitute technologies. Consider the desired product performance goals rather than focusing on a specific solution, to ensure all enabling technology options are considered. It is not always necessary to invent a solution, as one may exist in another industry.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 3.9
• Senior and Project Team management turnover issues are common in industry, and the effects on NPD are difficult to control. Good NPD protocols to manage Decision Gates mitigate these issues by verifying management match to project, supported by a plan of succession.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 3, Gate 4, Gate 5, Gate 6, Gate 7
• Good technical and commercial issue management requires more than good process. Experienced multi-functional teams, that address issues proactively with management understanding and support, are equally important. An open dialogue at the start of each project is a good method for reinforcing respective roles and responsibilities.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 2.1
• The decision to proceed with commercialization includes the ability to acquire necessary materials, conduct manufacturing, gain entry to the market, and ensure customer acceptance through awareness, acceptance and use.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 6
• A plan for getting to market and knowing who approves purchases of such new products is critical early in the project and again downstream. This avoids dead time between then the product is available to order and when the customers start buying it. Understand how customers make purchasing decisions, and know any required demonstration periods and projected conversion rates.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 1.5, Step 7.9
• Field-testing is needed early in the NPD process to ensure completeness of the internal product-testing regimen. This validates product acceptance. For technology-based products it also tracks performance under a range of environments and conditions of use.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 6.3
• Supply contracts for materials and components should be confirmed early in the validation or testing stage. This is particularly important when product performance or regulatory acceptance testing will require a significant portion of the project's timeline and resources.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 4.12, Step 4.5
• The early assessment of potential barriers to NPD include an initial understanding of the manufacturing requirements and implications of the envisioned device.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 2.3

• Decision to implement development plan — The cost of commercialization (both people and financial) is understood and will be supported by top management. This necessitates early creation and discussion of financial projections that include the obsolescence of existing products or facilities (obvious, but frequently not considered in the analysis).
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 4
• When reviewing prototypes for market introduction, management needs to objectively understand what will constitute success and when expectations are not being met. The tough decision to stop a project only happens when management in all functional areas, has a clear understanding of these issues.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 7
• Align product development with manufacturing capabilities, to ensure that any process issues or infrastructure upgrades are planned and implemented on a timetable appropriate for market launch.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 7.4
• The NPD scale-up and validation stages cannot be omitted to save time or money, particularly when revisions are made mid-project. It is a gamble that usually ends up costing more of both.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 7.6, Step 7.5, Step 7.4
• Test commercial assumptions (e.g., pricing and sales forecasts) early — the validation/scale-up stage should include testing of all key project premises, commercial as well as technical.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 2.1, Step 6.4
• Close collaboration with suppliers and customers may put ownership of intellectual property at risk. Ensure that all IP issues are identified and resolved internally, with proper protections in place, before disclosing proprietary information to external partners. Execute agreements with these partners that explicitly state ownership of the IP.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 4.4
• Consider cultural difference that may influence product acceptance, which involves customer interests, level of risk customers are willing to take, the the state of refinement required for them to commit to adoption and use.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 2.2
• Product launches into international markets often schedules sequence of launches into the various markets, because of supply limitations, regulatory differences, and the variation in drivers within each market segment.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Gate 7, Step 4.5, Step 7.9
• Establish contracts with suppliers early in the process to ensure a source of raw materials, and to engage their expertise within the overall planning process.
  Conclusions drawn from case studies and experience.
  Occurrence of finding within the model: Step 4.6

Model: Stage-Gate protocols provide an overall framework for project planning and management, and a basis for creating a series of checklists to ensure the steps and activities are completed. (Cooper [1997])