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PDMA Process StageGate
The document outlines a stage-gate model for managing a new product development process. It includes goals for the process, definitions of key terms like stages and gates, and descriptions of activities at each stage and criteria for passing through gates. The overall goal is to efficiently develop new products with a strong market and competitive focus through cross-functional collaboration and go/kill decision points.
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PDMA Process StageGate
- 2. New Product Process Portfolio Management & Stage-Gate Model STAGE-GATE MODEL Business Strategy and New Product Gate Strategy Portfolio Review: Stage This meeting • identifies strategic imperatives Gate • checks project priorities Stage • checks for portfolio List of projects: Active and On-Hold balance Total Project Scores from Gates • makes adjustments Gate to the gating model Stage Strategic Imperatives(Must Do Now) Prioritization Adjustments Gate Adjustments Review
- 4. Product Delivery Process DECISION ON SECOND BUSINESS INITIAL POST-DEV SCREEN CASE SCREEN STAGE STAGE STAGE REVIEW (Feasibility) (Money Gate) 1 1 2 2 3 3 4 GATE GATE GATE GATE PRELIMINARY DETAILED DEVELOPMENT INVESTIGATION INVESTIGATION (Build Business Case) STAGE PRE-LAUNCH BUSINESS 4 ANALYSIS STAGE TESTING & POST 5 VALIDATION IMPLEMENTATION GATE REVIEW 5 FULL PRODUCTION & LAUNCH
- 6. Goals #1 Quality ofExecution 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)
- 7. 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
- 8. Goals #3 A StrongMarket Orientation Key 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
- 9. Goals #4 Fact-Based ProductDefinition 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
- 10. Goals #5 Fast-Paced ParallelProcessing 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
- 11. Goals #6 True Cross-FunctionalTeam 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
- 12. Goals #7 Products withCompetitive 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
- 13. Goals #8 A Fast-Pacedand 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
- 15. 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
- 16. Definitions 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 DELIVERABLES OUTPUTS CRITERIA
- 17. 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
- 18. 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?
- 19. 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
- 21. Idea Generation Keys tosuccess 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
- 22. Idea Capture &Handling Idea Generation FEEDBACK TO SUBMITTER STAGE FOCAL PERSON 1 1 GATE IDEAS INITIAL SCREEN PERIODIC OTHERS IN REVIEW & UP- IDEA VAULT OR BANK COMPANY DATE - IDEAS ON HOLD - “DEAD” IDEAS
- 23. Idea Capture &Handling Idea Generation SUBMISSION DATABASE (Excel Spreadsheet online) - NEW IDEAS www.tribuneinteractive.net/ideaorama
- 24. Gate 1 Initial 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 INITIAL SCREEN STAGE 1 1 GATE PRELIMINARY INVESTIGATION
- 25. Gate 1 Initial 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) INITIAL SCREEN STAGE 1 1 GATE PRELIMINARY INVESTIGATION
- 26. Stage 1 Preliminary 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) INITIAL SECOND SCREEN SCREEN STAGE 1 1 2 GATE GATE PRELIMINARY INVESTIGATION
- 27. 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. SECOND SCREEN STAGE STAGE 1 2 2 GATE PRELIMINARY DETAILED INVESTIGATION INVESTIGATION
- 28. Gate 2 “Feasibility” 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) SECOND SCREEN STAGE STAGE 1 2 2 GATE PRELIMINARY DETAILED INVESTIGATION INVESTIGATION
- 29. Gate 2 “Feasibility” 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) SECOND SCREEN STAGE STAGE 1 2 2 GATE PRELIMINARY DETAILED INVESTIGATION INVESTIGATION
- 30. 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-meet S = should-meet (Hoescht scale) SECOND SCREEN STAGE STAGE 1 2 2 GATE PRELIMINARY DETAILED INVESTIGATION INVESTIGATION
- 31. 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 SECOND DECISION ON SCREEN STAGE BUSINESS CASE 2 2 3 GATE DETAILED INVESTIGATION
- 32. Stage 2 Detailed Investigation 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? SECOND DECISION ON SCREEN STAGE BUSINESS CASE 2 2 3 GATE DETAILED INVESTIGATION
- 33. Stage 2 Detailed Investigation 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 SECOND DECISION ON SCREEN STAGE BUSINESS CASE 2 2 3 GATE DETAILED INVESTIGATION
- 34. 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 DECISION ON STAGE BUSINESS CASE STAGE 2 3 3 DETAILED DEVELOPMENT INVESTIGATION
- 35. 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) DECISION ON STAGE BUSINESS CASE STAGE 2 3 3 DETAILED DEVELOPMENT INVESTIGATION
- 36. Stage 3 Development 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 POST DECISION ON DEVELOPMENT BUSINESS CASE STAGE REVIEW 3 3 4 DEVELOPMENT
- 37. Gate 4 Post 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 POST DEVELOPMENT STAGE REVIEW STAGE 3 4 4 DEVELOPMENT TESTING & VALIDATION
- 38. Stage 4 Testing 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 PRE- POST COMMERCIALIZAT DEVELOPMENT ION BUSINESS REVIEW STAGE ANALYSIS 4 4 5 TESTING & VALIDATION
- 39. Gate 5 Pre-launchBusiness 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 PRE- COMMERCIALIZATION BUSINESS ANALYSIS STAGE STAGE 4 5 5 POST DEVELOPMENT FULL PRODUCTION REVIEW & LAUNCH
- 40. Stage 5 Full Production& Market Launch Characteristics 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) POST PRE- IMPLEMENTATION COMMERCIALIZATION BUSINESS ANALYSIS REVIEW STAGE 5 5 Production & Market Launch
- 41. 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 POST IMPLEMENTATION REVIEW STAGE 5 TESTING & VALIDATION