NPD- Stage Gate Presentation


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NPD Stage-Gate Process Overview

NPD- Stage Gate Presentation

  1. 1. New Product Development Stage- Stage-Gate® Process Overview Presentation* Howard Danzyger, PMP* Concepts from Cooper R.G., Winning at New Products Accelerating the Process from Idea to Launch (third edition). New York: Perseus Publishing, 2001.
  2. 2. Benefits of a Good Process Well defined project scope Cost objectives established based upon customer, consumer and competitive needs Realistic schedules Minimal quality problems at introduction No design changes late in the process Known and agreed to product forecasts Easily accessible product documentation Minimal “firefighting” late in the process Focus on innovation vs. problem resolution Agreement on accepted risks and mitigation plans Metrics to track performance Defined roles and responsibilities 2
  3. 3. Why are Innovative New Products Important New products drive growth New products offer greater margins Innovative proprietary products provide barriers to competition Innovative products enable you to be category leaders Almost 70% of leading US product developers use some type of stage-gate process – Product Development Institute “The companies that know “You only get a position in the how to develop things are future by investing, creating ultimately going to create the something new, and staying most shareholder value. It’s ahead of the competition. So it’s as simple as that.” simple: invest or die.” Jeffrey Immelt, Chairman and CEO, Craig Barrett, CEO, Intel General Electric Business 2.0, January/February 2004 MIT Technology Review, October 2003 3
  4. 4. Innovation is Important New Product vs. Innovation 4
  5. 5. Best Practices of Successful Companies Strong consumer focused development process Ideation is user and trend driven Significant up front time devoted to research and product definition Strong project management ensuring that the scope, timing and cost project requirements are achieved Dedicated cross-functional teams for duration of project A formal thorough flexible NPD process Upper management is fully engaged in reviews and decisions Vendor involvement at early stages Teams focus on 1 to 3 primary projects at one time All functions work in parallel Teams held accountable and rewarded 5
  6. 6. New Product Development(NPD) Stage Gate® Process Basics 6
  7. 7. What is the NPD Process? It is a business process containing methods and tools to develop products Consumer driven Supported by Top management involvement Executed with cross functional teams Organized through project/program management Direct link to business objectives through regular executive reviews 7
  8. 8. Who is involved in NPD? EVERYBODY! ◦ Product Marketing ◦ Product Development ◦ Channel Marketing ◦ Finance ◦ Operations ◦ Quality ◦ Marketing Services ◦ Sourcing ◦ Supply Chain ◦ Purchasing ◦ Planning ◦ Legal ◦ Sales ◦ Customer Service ◦ YOU! 8
  9. 9. ®NPD Stage Gate Process Overview GATE STAGE STAGE Gate Keepers Activities Activities 9
  10. 10. NPD Stage Gate® Process Overview Stages consist of activities that are recommended for each project from the master check list Gates are check points to evaluate project progress through deliverables list Gate Keepers provide an independent review of project merits, guide the team and make gate decisions 10
  11. 11. NPD Stage Gate® Process (4 Stage Example) Stage 0 • Market Discovery • Legal Discovery • Packaging Discovery • Operational Discovery Discovery • Technology Discovery • Market and Consumer Research • First Draft of Claims • TimelineGate 1 Stage 1 • Functional Review of • Concept Generation • Early supplier involvement Program ObjectiveIdea • Program Objective Created • Design/Engineering Expense Approvals Definition • Design/Engineering Creations and Reviews • Prototype creation • Strategic Mfg and Supplier Analysis • Make vs. BuyGate 2 • Sales, Customer & Consumer Reviews • Costs Finalized/Financial Model Stage 2Program • Launch, Adv and Promotions Defined • Regulatory, Operations and Sourcing ReviewsObjective Development • Legal Reviews • Business Plan • Product Specification • Capital Approval Gate 3 Stage 3 • Qualification Plan • Packaging Kicked Off Capital/Project • System Setup • Pilot Run Approval Deployment • Tooling Approved and Completed • Launch, Adv and Promotions Created • Packaging Finalized • Purchase Orders Issued • Process and Product Qualification Gate 4 Stage 4 Ship from Stock • First Production Run Approved Post Audit • Distribute Launch Materials • Mfg and Supplier Audits • Dock Audits 11
  12. 12. What projects follow NPD Stage Gate® process? Any process requiring development of a product. NPD Projects of varying magnitudes all follow the same process Simpler projects can have tasks made “not-applicable” with agreement of team and gate keepers Channel projects that require product development will utilize applicable process steps Channel projects that are color change, packaging change or re-combination of existing product components do not have to follow this process Packaging changes do not have to follow this process 12
  13. 13. What is a Stage? Consists of a set of parallel activities that are carried out to move the project forward Activities may be made “Not Applicable” Provides the information required to make decisions at gate meetings Preceding each Stage is a gate that is a go/no go decision point as to whether to enter the stage In general, the farther a project moves through the stages, the more resources are committed 13
  14. 14. What is a Gate? Gates are used to answer 3 questions so that resource commitments can be made: ◦ Have the steps in the previous Stage been completed? (Checklist) ◦ Does the project make business sense based upon quantitative and qualitative criteria ? ◦ Is there a plan to enable the project to meet its objectives? The gate meeting should provide the information required to make a go/no go/hold/recycle decision for the project Gate keepers are assigned to each project and gate to provide the gate decision (go/no go/hold/recycle) 14
  15. 15. What is a Gate Decision? The gate decision can be Go, No Go, Hold or Recycle ◦ Go authorizes the movement to the next stage ◦ No Go does not authorize the movement of the project to the next stage and eliminates it from further review ◦ Hold places the project on hold pending technical, marketing or environmental changes ◦ Recycle sends the team back to the previous stage for further refinement prior to re-submitting for gate approval 15
  16. 16. What are Gate Keepers? Gate keeper consists of the cross functional Leadership Team Gate keepers make the gate decision Gate keepers independently recommend a gate decision and reach a consensus at the gate meeting 16
  17. 17. New Product Development(NPD) Stage Gate® Process Benefits 17
  18. 18. Benefits Product Process• Products drive profits and growth Ease of use and consistency• Products meet consumer needs Representation of all functional areas• Improved speed to market Discipline• Reduced product costs• Reduced project costs• Improved product quality End Result Improve the speed with which you develop high quality, high margin products that customers demand that adds to your top and bottom line 18
  19. 19. Benefits A common roadmap exists with which to develop products Formalized process eliminates wasted effort Common terminology improves communication Specific inputs, actions and outputs for each activity within the process minimize mistakes Cross functional involvement early, often and always identifies issues and reduces rework Gate reviews validate process adherence and project value Discovery activities identify unmet consumer needs and competitor weaknesses Projects are identified to attack discovered opportunities Consumer research used throughout process to validate project work Emphasizes execution of activities on the critical path Implements centralized storage of product data to improve collaboration Documented templates and procedures reduce resource requirements, save time and reduce errors Continuous improvement is critical to achieve a world class state 19
  20. 20. Advantageous of Cross Functional Collaboration Focus early in the process • The ability to influence a projects outcome is much greater at the beginning of a project • Typically most project activity is focused on the later stages of a project Ability to influence Activity outcome Level Typical activity profile MSO MS1 MS2 MS3 MS4 MS5 MS6 Discovery Definition Design Development Deployment Delivery Post Audit 20
  21. 21. Representation of All Functional Areas Collaborate in the process • Collaboration is critical early in the process • Collaboration should occur early, often and always Collaboration Level Proposed Typical collaboration Collaboration level level MSO MS1 MS2 MS3 MS4 MS5 MS6 Discovery Definition Design Development Deployment Delivery Post Audit 21
  22. 22. Incorporate Discipline Define checklists so that process is followed Identify project check points so that resource commitments can be made : ◦ Have the necessary steps been completed? ◦ Does the project make business sense? ◦ Is there a plan to enable the project to meet its objectives? Flexibility is used to increase discipline ◦ Activities are allowed to move within the process (with consensus) ◦ Activities can be agreed to be “not applicable” 22
  23. 23. Bottom Line The time and effort put into developing, using and continuously improving the NPD process is essential for business success If you are not doing this your competition is!