Decision Gate 8

Primary findings

Secondary findings

Primary findings

Carriers

One company established an NPD process with carefully staged decision-making, rigorous process reviews, and strict time lines. Yet, skillful project champions would maneuver to win continued support at each level of project review. The company then reassigned project managers so that the more empirically included truth seekers were in charge of early stage reviews, and more commercially included success seekers managed the later stages. That simple change improved NPD productivity.
Private sector experience in pharmaceutical industry.
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Methods

Anticipating and meeting customer demands requires more teamwork and participation of project personnel in decision-making. This requires an overall understanding of NPD business by team members and their leaders.
Survey of 87 manufacturers.
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Effective control is required for new product success. To achieve this, new product development projects should be regularly monitored and should enjoy grace periods.
Survey with significant findings.
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Four Best Practices in the NPD process are: 3) Metrics on how well the NPD process is working — These metrics focus on if projects are following the process and if effective gates are being held.
A quantitative survey of 105 business units, supported by team's experience in NPD modeling, consultation, application and analysis.
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Four Best Practices in the NPD process are: 4) Tough and demanding Go/No-Go decision points, where projects really do get killed. Some businesses claim to have gates but a closer inspection reveals that these are largely project review points with the result that projects rarely get terminated.
A quantitative survey of 105 business units, supported by team's experience in NPD modeling, consultation, application and analysis.
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To ensure compliance with the FDA's Quality System Regulation, medical device manufacturers should use a structured product development process to instill discipline in the product life cycle. A hierarchical approach arranges activity from Stages (phases) to Steps to Activities and finally to Tasks. Each Stage has a unique theme and set of deliverables. For example: Stage 4 — Commercialization. Delivering the product to customers in a controlled manner and gathering feedback on the product's performance. Includes full-scale product launch, release of evaluation tools and mass communication with customers. Manufacturing operations are ramped up to full-scale production. In addition, a post-launch evaluation is conducted to assess the actual results in comparison to projected performance and sales. The NPD team hands the product ownership and control over to the supporting organization for the duration of the product's life cycle.
Summary of the U.S. Food and Drug Administration's regulations for the research and development process underlying Medical Device manufacturing.
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Measures

Market opportunity criteria are typically employed for go/no-go decisions early in the process and again after launch. Criteria may include customer satisfaction, market acceptance, product quality and sales volume.
Survey of 77 manufacturing companies
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Measuring Success occurs during two post-launch reviews: 1) One to three months after launch, including comparisons of the project's costs and timing targets with actual performance, the NPD process and project execution suggestions; 2) Three to twelve months later (depending on project complexity) when there is enough commercial experience to judge the market receptivity, along with manufacturing and technology performance.
Industry experience.
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Results from Process Quality Assessment Instrument and the Output Quality Assessment Instrument can provide essential information to support risk-based go/no-go decisions during NPD product life cycles.
Single subject case study
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Tips

16 factors were identified as important for post-launch reviews: tangible technological advantage, superior consumer fit, clearly defined promotion plan, clear product definition, senior management endorsement, likely trade adoption, compelling market size potential, lucrative potential market, product-led strategy, clearly identified brand strategy, global product compatibility, production fit, commercial fit, strong trade support, reliable market intelligence, and predictable development pattern.
Survey of 314 new product projects.
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Emphasizing financial criteria have a positive impact on new product success from the go-to-development gate to the first post-launch review; yet it is shown that the relative effect of financial criteria on new product success is significantly bigger in the latter evaluations.
Survey. Importance given to financial dimension is positively associated with new product success at the go-to-development decision (δGate2 = 0.18, p < 0.10), go-to-market decision (δGate3 = 0.30, p < 0.05) and post-launch review (δGate4 = 0.42, p < 0.01).
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Fuzzy Gate approach — Permit the project team to decide when to stop Stage level work and proceed to the next Decision Gate, particularly when NPD cycle time is considered critical to market success.
Survey. Author conclusions drawn from analysis of Project Manager self-reports (n = 392).
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Market opportunity criteria relate positively with project success at the initial screening, the market launch gate, and the post-launch review.
Survey. The relative importance of market opportunity correlates positively with the new product success at the initial screening(εGate1 = 0.40, p < 0.01), go-to-market decision (εGate3 = 0.23, p < 0.05), and post launch review (εGate4 = 0.18,p < 0.10).
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Refer to customer acceptance, satisfaction and sales in units as important criteria when making decisions at gate 8, Post Production Assessment.
Survey of 166 managers from Dutch and UK companies. Between 77% to 54% of companies used these criteria at this gate.
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Results indicate that the changes and problems that occurred during the execution of the project contribute much more to learning than meticulous planning, which is based on past knowledge and proven solutions that have been devised to meet previously defined needs.
Survey of 475 research and development projects
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Results show that placing importance on customer acceptance criteria correlates positively with project success at every stage of the process.
Survey. Customer acceptance dimension is positively associated with new product success at each and every of the review points (γGate1 = 0.26, p < 0.05; γGate2 = 0.30, p < 0.05; γGate3 = 0.24,p < 0.05; γGate4 = 0.26,p < 0.05).
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Secondary findings

Carriers

Organizations can deal with the tensions inherent in decision-making by focusing on meaning — the GOAL. The purpose or meaning of what the organization intends to accomplish can crate a vision that sets into motion the process through which multiple organizational interests become aligned.
Source: McGee, JV & Prusak, L (1993). In: Ho, K., Bloch, R.; Gondocz, T., Laprise, R., Perrier, L., Ryan, D., & et al. (2004)

Measures

Measures of Organizational Integration, NPD Proficiency and new product success
Source: Price, 1972; Pinto & Pinto, 1991; Ruekert and Walker, 1987a, 1987b; Miller and Friesen, 1982; Souder, 1981. In: Millson, M.R. & Wilemon, D. (2006)

Tips

Customer acceptance criteria are important at all gates, particularly after launch.
Source: Hart, et al., 2003. In: Carbonell-Foulquie, P., Munuera-Aleman, J. L., & Rodriguez-Escudero, A. I. (2004)

Market potential criteria used after launch to evaluate success or failure.
Source: Henard & Szymanski, 2001. In: Carbonell-Foulquie, P., Munuera-Aleman, J. L., & Rodriguez-Escudero, A. I. (2004)

Use market criteria during the concept screening gate 2, product related criteria during product testing gates 5 & 6, financial criteria during gates 8 & 9 (post production assessment and terminate production).
Source: Ronkainen (1992). In: Hart, S., Jan Hultink, E., Tzokas, N., & Commandeur, H. R. (2003)

Utilize financial criteria in go/ no-go decisions, including payback period and discounted cash flow.
Source: Cooper, 2001, Hart et al., 2003, & Ronkainen, 1985. In: Carbonell-Foulquie, P., Munuera-Aleman, J. L., & Rodriguez-Escudero, A. I. (2004)