A call to arms take the lead in system innovation Peter Kalish GE Global Research PROMODEL User’s...

a call to arms

take the lead in system innovation

Peter KalishGE Global ResearchPROMODEL User’s ConferenceMay 2006

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{ us }

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Market Forces areIncreasing the Valueof Our Skill Set and Our Vision

better communication tools(telephone, networks, internet, cell phones)

faster communication ofconsumer alternatives

increasing consumer demand fornew products

faster new productintroduction

accelerated delivery ofnew production (or service) systems

better system designers

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the pace of market change is almost scary

Diffusion of Technology into US Households

SOURCES: U.S. Bureau of the Census (1970 and various years); Cellular Telecommunications Industry Association (1996); The World Almanac and Book of Facts (1997).

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the technology adoption lifecycle(Geoffrey Moore, Crossing the Chasm)

early marketthe

chasmmid-market late market

thetornado

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adoption lifecycle accelerated

e.g., telephone(1910 – today)

e.g., VCR(1980 – today)

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systems…

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simulating the early market…questions>how many products can I launch

simultaneously?>how will existing operations be impacted by

a new product?>how might the manufacturing process look?

key stakeholders >

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early market tools

• modify resource plans to meet product launch dates• identify impact of key technical risks• coordinate efforts in cross-functional teams

• assess viability of marketing plan ($$ allocation)• manage resource (people, equipment) interdependencies• project revenue stream under different scenarios

• design pilot production facilities• analyze supply chain alternatives• project throughput from conceptual design of factories

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simulating near the “chasm”…questions>do my suppliers have enough capacity?>can I produce orders if the market takes off?>can I distribute products when the orders

come in?

key stakeholders >

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tools for jumping the chasm

• run scenarios on different market segments• assess impact of targeting options on sales force• anticipate risk of stretching resources too thin

• design supply chain• design factories• assess stress on resources due to poor market targeting

• design order fulfillment workflow systems

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simulating in the tornado…questions>how can I improve my workflow?>do I have enough cash to support runaway

orders?>do we have a sufficiently large sales force?

key stakeholders >

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tools for managing the tornado

• identify throughput increase opportunities• assess staffing plan• collaborate with suppliers to increase capacity

• identify workflow deficiencies and opportunities• assess sales force effectiveness programs and incentives• support financial projections (revenue and cost increases)

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simulating the mid-market…questions>am I doing things most efficiently?>can I improve product or service quality?>are there other sources of revenue for this

product?

key stakeholders >

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tools for mid-market navigation

• design product line upgrades for new market segments• assess impact of quality improvement alternatives• design spare parts production facilities• find cost takeout opportunities

• design service offerings• perform risk analysis on long term service agreements

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simulating the late market…questions>how can I change the product to improve

margins?>can I expand my service and spare parts

business?>should I divest myself of this product line?

key stakeholders >

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tools for riding the late market

• improve productivity (more with less)• assess product redesign costs• analyze product line consolidation alternatives• perform due diligence for acquisition/divestiture

• improve productivity in services (more with less)• assess service upgrades, cost and revenue implications

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back to superman

our role as systems innovators…>know the product (service) lifecycle better

than anyone in our organizations>use simulation tools to be persuasive

– know what the key issues are– address those issues visually and through

data>act and speak with confidence (“do you

believe?”)

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learn from Marc Antony

“…for Brutus is an honourable man”

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persuasion, an example…capacity entitlement at GE Solar

percent of current raw material input

thro

ughp

ut

{notional data}

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four things to remember…

1. our time has arrived 2. there is no shortage of opportunity

3. don’t just talk, be persuasive4. be confident, you have earned it