The Right Idea-to-Launch (I2L) System

© RG Cooper & Associates Inc.Private and Confidential

48 Brant StreetOakville ON L6K 2Z4 Canada

P: +1 905 845 7273RG Cooper & Associates Consultants Inc.www.bobcooper.ca

The Right Idea-to-Launch (I2L) System

The Triple A System Part 1:Adaptive & Flexible

With: Dr. Robert G. CooperCreator of the Stage-Gate® System

ISBM Distinguished Research Fellow, Penn State University, USA.

Professor Emeritus, McMaster Uni, Canadaemail: [email protected]

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© RG Cooper & Associates IncPrivate and ConfidentialRG Cooper & Associates

www.bobcooper.ca

The Right Idea-to-Launch (I2L) System– The Triple A System

Gate 1

Idea Screen

Gate 2

2nd Screen

Gate 3

Go to Development

Gate 4

Go to Test

Gate 5

Go to Launch

PLR

Post Launch Review

Discovery: Idea

Generation

Stage 1: Idea

Scoping

Stage 2: Build

Business Case

Stage 3: Development

Stage 4:Testing & Validation

Stage 5:Launch

The Customer or User

AgileAdaptive & Flexible Accelerated

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• Spiral (iterative) development:

o a series of Build-Test-Feedback-Revise iterations

o Build something – get it in front of customers

• Context-based – one size does not fit all

• BTOM at OMICRON

• Stage-Gate-TD, Lite and Xpress

• HP’s embryonic versus mature markets processes

• Risk-based contingency model – key uncertainties & assumptions define deliverables & stage activities

• Innovation project canvass

• Different criteria for Go (scorecards, profiling) & gates integrated with Portfolio Management (tomorrow)

Adaptive (& Flexible)A1:

The “Triple A” I2L System

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1. Adaptive “Spiral Development” – To Get the Product Right

• Handles the dynamic information process with fluid, changing information

• Gets the product right

Spiral (Iterative) Development

• Front-end work or homework is done• The product specs are determined, the product

definition is fixed• Development proceeds – the product is developed• Then into Testing… but…

By Contrast: the Rigid, Linear Process

Stage 1- 2

Front-End Homework

Gate3 Stage 3

Development

Go ToDevelopment

Gate4

Stage 4

Testing &Validation

Go ToTesting

Gate5

Go to Launch

Product Definition Fixed Here

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Fluid InformationMarket & needs change New competitive product

New technology available

Unreliable InformationPoor VoC work Customer did not know what

they wanted

A Rigid, Linear Process does not work

Not adaptive Ignores new info

What to do?

Iterate SpiralBut Things Change

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They use a series of iterative steps or ‘loops’ Build-test-feedback-and-revise

They define what information is fixed & reliable

And define what design elements of the product are fixed versus variable (fluid)

They develop a first very early version of the product• A virtual prototype, a “protocept”

They test it with the customer, seeking fast feedback

Which they then use to produce the next & more complete version, a crude model or rapid prototype… & so on

Use tools: Virtual prototypes

Rapid prototypes

Laptop & video projector

Smart Teams Practice Spiral Development

Get something in front of people! People don’t know what they’re looking

for until they see it.

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Adaptive Via Spiral Development – a Series of “Build-Test-Feedback-and-Revise” Iterations

Gate 1

Idea Screen

Gate 2

2nd Screen

Gate 3

Go to Development

Gate 4

Go to Test

Gate 5

Go to Launch

PLR

Post Launch Review

Discovery: Idea

Generation

Stage 1: Scoping

Stage 2: Build

Business Case



Stage 5:Launch

The Customer or User

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VoC User Needs-and-Wants Study

- Face to face interviews

- By entire project team

- With users & customers

- Identity needs, problems, issues, requirements

Full Proposition Concept Test

- A simulated 'sell'- Pre-Development!- With 'virtual prototypes' or 'protocepts'

- And brochures, collaterals, story boards

- And PPT selling presentation

- Gauge: interest, liking, preference & purchase intent

Rapid-Prototype & Test

- Again a test of proposed product

- Early in Development Stage

- Using a rapid prototype, crude prototype, or model

- 3-dimensional & physical

- Again with selling materials

- Gauge customer reaction & purchase intent

Working Model

- Much the same…- But versions of product much closer to the 'final product'

- Always gauging customer reaction & purchase intent

Next Version- Again much the same as above

- Closer yet to “final product”

Customer Tests- True prototype tests in actual in-use conditions

- Field trials- Beta tests- In-home tests

Gate2

Gate3

Stage 2: Build Business Case

Stage 3: DevelopmentTesting Stage 4

Gate4

Adaptive: Spiral Development – “Build-Test-Feedback-Revise” Iterations

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Designing a New Car with MVPs

MPV=minimally viable product

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Example: Streetlamp

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Learn from the Auto Industry – How They Do It So WellSix Versions or ‘Protocepts’ of a Car – Before Production

Start with some artist’s creative

sketches….Version 1, a concept

Version 2: Crude engineering sketches –

basic hand-drawn engineering drawings

Version 3: Computer graphics, CAD generated,

and simple at first…..

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Version 4: The “virtual car”. Virtual reality

pictures bring the car and cockpit alive

Version 5: Clay sculpturing done initially by computer

and robot tools – small clay models, then full-sized

Version 6: Prototypes which are field-tested

Finally ready for production

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Protocepts

Protocepts can be…

Simple, easy-to-build models (paper, cardboard, clay, wax)

Drawings and sketches (by artists or art students)

CAD drawings & 3-D CAD drawings

A series of MVPs (something that actually functions)

Rapid prototypes

Crude working models

Early prototypes

Anything to test the proposed product before & during development

Technically – can we develop and/or make it?

Market-facing – does the customer like it?

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2. Build in Flexibility – Context-BasedTailored to Each Project

• No activity is mandatory• Nor is every deliverable required for every project • Not a rigid list of actions & deliverables

Make the process flexible & adaptive

• They map out their detailed Forward Plan• They propose actions & deliverables

Trust the project team – give them latitude

The Team maps out their detailed Forward Plan for the

next Stage

• The Team maps out their detailed Forward Plan• They propose actions & deliverables• Approved by Gatekeepers for next stage

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3. Context-Based – Flexible, Tailored to Different Types of Projects

Gate1

IdeaStage

Idea Screen

Discovery

Stage-GateLite

Gate3

Stage1 & 2

Go to Develop

Scope & Business

Case

Gate5

Stage3 & 4

Stage5

Development & Testing

Launch

Go to Launch

PLR

Stage-GateXPress

Gate3

Stage1 & 2

Stage3, 4 &

5

Scope & Business Case

Execute: Development,

Test & Launch

Decision to Execute PLR

Gate4

Stage3

Go to Develop

Development

Gate5

Stage4

Stage5

Testing Launch

Go to Launch

PLR

Gate2

Stage1

Gate3

Stage2

Scoping Business Case

2nd Screen Go to Test

Stage-Gate(Full)

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Gate 2Stage 1

PROJECT SCOPING

Gate 1 Gate 2 Gate 3

Projects enter the NP Process at Gate 2 (sometimes Gate 1 or 3)

Gate 1

Trigger

The 3-Stage Technology Development Process

Stage 1:Scoping

Discovery: Idea Generation

Stage 2: Build Business Case



Stage 5:Full Launch

The Normal 5-Stage, 5 Gate Stage-Gate® New Product Process

Stage 1 Gate 3

TECHNICAL ASSESSMENT

Stage 3 Gate 4

APPLICATIONS PATH GATE

DETAILED INVESTIGATION

The Platform & Technology Development System

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Some Projects Have Many Uncertainties, High RisksRisk Dictates the Appropriate I2L System

Product & Production

Market orCustomer

Uses our existing operations/tech-

nology processes

Operation/tech-nology processes new to us but exist

externally

Product or production

technology are totally new, don’t

exist

Sells into existing market/customer,

one we are familiar with

Sells into a new market/customer,

but one we are familiar with

Sells into a new and/or unfamiliar

market/customer for us

Low Risk Overall

Moderate Risk:Low Technical Risk;

Moderate Market Risk

High Risk:Low Technical Risk;

High Market Risk

Moderate Risk: Moderate Technical

Risk; Low Market Risk

High Risk:High Technical Risk;

Low Market Risk

Moderate-High Risk Overall

Very High Risk:High Technical Risk;

Moderate Market Risk

Very High Risk:Moderate Technical

Risk; High Market Risk

Exceptionally High Risk Overall

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Dealing With the Valley of Death

High risk, many unknowns Especially near beginning of the project

Results in the “Valley of Death” May be killed too soon

Man

agem

ent

Su

pp

ort

&

En

thu

sias

mIdea

Preliminary Work

Development & Prototypes

Ris

k

Time

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The BTOM Process at OMICRON

If somebody has an idea that creates enough excitement in the management team:

They can become a BTOM (Breakthrough TO Market) project leader

They get resources (must request specific resources from management)

They have 6 months time to come up with a new product

Not necessary to follow any Company standards

• For example, following software development rules, using standardized components, guaranteeing safety standards, etc.

But the teams are responsible for the safety of the product

After the 6 months, something needs to be shown that has already been seen and/or tested by customer

It may even be sold before the end of the 6 months

But customer must be told that it is not a regular product

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Not For Every Project!

When the 6 months are over, there are three possibilities: Terminate the project with no new product or business Start an ATOM project to develop the new product / business, meeting all

regulations & rules Continue the BTOM project for another 6 months

• This is possible if one member of the management team wants it. • The one who wants it can overrule all the other colleagues (this

possibility exists only once)

Different from the ‘regular process’ (ATOM): Can be very vague or even unknown what the project will lead to E.g., the goal of a BTOM project can be to develop a solution for a problem

• without knowing up-front what the product / business model will be

Note while still “new” at OMICRON, BTOM looks like a promising adaptation & combination of skunk works (outside the formal

organization & system) and sprints (time-boxed – but 6 months)

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B-TOM Model Explore and discover Anticipate scenarios Divergent thinking Customer's jobs

Create and breed Fermentation phase Absurd ideas, concepts Dive into the subject, dialogue Sort and prioritize

Prototype and test Rapid prototyping Lead customers, sounding boards Sponsor reviews Smart & fast failures Evaluation of lessons learned Business models

Market experiments Evolutionary optimization Increasingly more controlling

Introduce and execute Planning Continual improvements and increasing

efficiency

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It Works!

Working with Customers – Seeking Fast Market Validation

The customer has to agree and sign that he is not buying a regular product, there is not the usual 10 year warranty

Service is only promised by the team members (as long as they work for the Company)

Thus he customer takes some risks when buying that kind of product

Note: for breakthrough innovations, it is very likely to find customers who desperately want the product / solution and are willing to share the risk

RESULTSBTOM is experimental at OMICRON – very new

First project – a successWould not have been done at all if not for BTOM

2nd project – a success; 3rd project underway

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Project Type

Emergent Agile Efficient(Traditional)

The Situation

A new market and/or technologyAn emerging or embryonic business

Exiting & rapidly growing but changing market

Mature marketWell know market,customers 8 needsWell-known technology

The Approach

Experimental Agile approach Traditional but efficient process

Core Objectives

Probe & learn via multiple prototypes or products to understand the value proposition to different customers Also to gain insights into the technical solution

Rapidly evolve the product design to meet changing customer needs & technical choices

Improve only those features valued by customersReduce product costs

HP’s Context-Based ModelThree Different I2L Systems –

Depends on Market & Technology Maturity

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Market Risks & Uncertainties (From HP)

Project Type


Customers Lead users, enthusiasts, innovators

Early majority in ‘adoption curve’

Late majority & laggards

CustomerNeeds

Largely unknown Known, but changing rapidly

Well-known & stable over time

Market Size Very small; may not even exist yet

Small but growing rapidly, growth phase of PLC

Large & defined; may be maturing, flat or even declining

Questions Does a market exist?In what form?Does value exist for the customer? How?Will anyone pay for what we offer?

Market size & growth?How quickly can we adapt and launch?How well does the design fit evolving customer needs?

Market size?Likely market share & expected sales?How can we sustainmargin & market share?

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Technical Risks & Uncertainties (From HP)

Project Type


Technology Maturity

Very immature but improving quickly

Maturing quickly; following a well-defined trajectory

Late majority & laggards

TechnicalRisks

Many risks and technical hurdles; cannot envision a solution

Some risks & technical hurdles; can likely be overcomeTechnical solutions is largely envisioned

Few risks; technical hurdles can be overcomes easilyCan already envision a solution

TechnicalSolutions

Many unexplored design & technology possibilitiesMay require new science & invention

Known, but changing rapidly

Well-known & stable over timeLargely a straightforward engineering or applied sconce initiative

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How to Mitigate Risk?

RiskReduce uncertainties & unknowns: Identify key

uncertainties & assumptions

Get the information to reduce uncertainty, validate assumptions

Uncertainties Unknowns

Reduce the amounts at stake

Break the investment process into increments – bet some

money, bet more… like buying options

Amounts at Stake

($)

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• Assumptions that are critical to the success of the project, product design or Business Case

Identify the key assumptions, unknowns & uncertainties

• What information is vital to verify or validate the key assumptions, mitigate risks

Then agree on the needed deliverables

• What we need to do to get that information?• What activities (actions)?

Finally determine the key tasks or activities needed in each

stage

4. Risk-Based Contingency Model

Information is one key to reducing riskThe other: a gated, incremental I2L system,

Net Result: Each project is custom-tailored, contingent on its unique risks & assumptions

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Corning’s Approach:

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Requires highly-skilled project teams“These are very smart people…”

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It Works!

First project thru the system

Required by Apple for I-Pad

Dedicated team

Fairly short ‘sprints’ or iterations

Met with CEO regularly

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5. The Innovation Project Canvas

• A tool to evolve good ideas & approaches into successful concepts

• Helps the project team map out their next steps

• Their “customized project plan”

• Highly efficient:

• Accelerates early phase of the innovation process

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It Is More Than a Form, It Is a Process!

Phase 1: Target Market and Value Proposition

Quality Check A

Solutions

Business Model

Risks & Unknowns

Next Steps

ProductDescription/ Value Proposition

Market

Phase 2: Solutions and Business Model

Quality Check B

Phase 3: Key Activities and Project Plan

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Project Canvas

Te resulting Project Action Plan

B

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References – Good ReadingWinning at New Products: Creating Value Through Innovation, 4th edition, 2011, by RG Cooper (Perseus Books, Reading, Mass), paperback, 391 pages. The classic best seller – 4th edition. Provides an overview of the critical success factors in product development, & outlines the Stage-Gate® process. www.amazon.com

Articles

Lean, Rapid & Profitable New Product Development, Cooper & Edgett. Outlines the seven principles to maximize your NPD productivity, including NexGen Stage-Gate®.

www.amazon.com

1. Cooper, R.G., Edgett, S.J. and Kleinschmidt, E.J., “Optimizing the Stage-Gate Process: What Best Practice Companies Are Doing –Part I”, Research-Technology Management 45, 5, Sept-Oct 2002, 21-27.

2. R.G. Cooper, S.J. Edgett & E.J. Kleinschmidt, "Optimizing the Stage-Gate® process: What best practice companies are doing – Part II”, Research-Technology Management 45, 6, Nov-Dec 2002.

3. R.G. Cooper, “Formula for success”, Marketing Management Magazine (American Marketing Association), March-April 2006, p 21-24.4. R.G. Cooper & S.J. Edgett, “Maximizing productivity in product innovation,” Research Technology Management, March-April 2008, pp

47-58.5. R.G. Cooper, “The Stage-Gate Idea-to-Launch Process – Update, What’s New and NexGen Systems,” J. Product Innovation

Management, Volume 25, Number 3, May 2008, pp 213-232. 6. R.G. Cooper, “NexGen Stage-Gate® -- What Leading Companies Are Doing to Re-Invent Their NPD Processes,” Cover story in

PDMA Visions, XXXII, no 4, Sept 2008, pp 6-10.7. R.G. Cooper “How Companies Are Re-Inventing Their Idea-to-Launch Methodologies”, Research-Technology Management, vol 52, no

2, March-April 2009, pp 47-57. 8. Cooper, Robert G. (2013), "New Products -- What Separates the Winners from the Losers and What Drives Success," in the PDMA

Handbook of New Product Development, 3rd Edition, edited by Kenneth B. Kahn, Hoboken, New Jersey: John Wiley & Sons, Inc. Chapter 1.

9. Cooper, Robert G., “The Stage-Gate® System for Product Innovation in B2B Firms”, in Handbook of Business-to-Business Marketing, edited by G.L. Lillien and R. Grewat, Northampton, MA: Edward Elgar Publishing Inc., 2012, Chapter 32.

10. Cooper, Robert G., “Creating Bold Innovation in Mature Markets,” IESE Insight, Third Quarter, Issue 14, 2012, pp 20-27.11. Cooper, R.G., “Where Are All the Breakthrough New Products? The Misuse of Portfolio Management,” (forthcoming in Research-

Technology Management, 2013)12. HP process described in: A. MacCormack, W. Crandall, P. Henderson & P. Toft, Do you need a new-product development strategy?”,

Research-Technology Management, Jan-Feb 2012, pp 34-43.13. Cooper, R.G., “Where Are All the Breakthrough New Products? Using Portfolio Management to Boost Innovation,” Research-

Technology Management, Vol 156, No 5, Sept-Oct 2013, pp 25-32.14. Cooper, Robert G., “What’s next? After Stage-Gate,” Research-Technology Management, Vol 157, No. 1, Jan-Feb 2014, pp 20-31.

Also, see selected articles on line (no charge) at www.bobcooper.ca

Documents

The Right Idea-to-Launch (I2L) System