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This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
Guy Laliberté, February 2010
Innovation Process Implementation in High-Tech CompaniesOverview Session
2
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Innovation in High Technology Companies■ Many companies focus on Product development and not product innovation
■ They put money in developing products before knowin g if the product can become “ an innovation ” and be launched with success on the market.
■ Many companies spend money on the development and f orget the market■ They spend a lot of money on designing the technolo gy and forget about launching it.
Resources must be allocated to all aspect of a prod uct and not only the technology.
■ Product Development and Management Association (PDM A)■ In 2007 : 60 % of firms surveyed in the US are now using some form (partial
or extended) of a Stage-Gate Process for their prod uct innovation. A direct link has been observed between companies performing well and how far the Stage-Gate process has been implemented.
■ Innovation must become part of the culture of compa nies to target growth■ Product Innovation ≠ Technology Development■ Rapidly evolving markets require a structured produ ct innovation approach
Introduction
3
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Culture of Innovation■ To be resilient and target growth, a high-tech company must “deeply integrate”
innovation in its culture.
■ A culture of innovation must be present at all levels of the company.
■ Innovation “as a mean of reaching company objectives” must be understood and part of the strategic and operational plan of the company.
■ Innovation is more then “new technology = new product”. A product is more then only technology (technology + commercial spin + price)
■ Innovation can be only “internal” and still impact results on the market (i.e. : implementing new processes or equipment to reduce cost and thus price of a product on the market)
■ Key Factors■ First step is to work on “integrating” innovation in the culture of a company. From the
executive to the middle management, all must obliged by it. ■ Key to innovation is the collaboration between marketing and engineering.
■ An invention badly launched on the market will never become an innovation.■ You can have the best technology but without the adequate means to target the right
markets, you will not succeed.
■ Understanding the life cycle of a product is key in taking decisions for success.
■ More and more innovations are “completed with external means” such as partnership and use of third party technologies.
Innovation in High-Tech Companies
4
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
Stage-Gating Model ���� A structured innovation approach
2
1
3 4 5
Discovery
Scoping Business Case
Development Test & Validation
Launching
Post Launch Review
2 Gate : A decision point in the product innovation p rocess
Stage : An activity of the product innovation proce ss.
Go toBusiness Case
Go to Development
Go to Test & Validation
Go to Launch
Initial Idea Screening
5
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ The Stage-Gating process is:■ a way to formalize and structure the innovation pro cess within a company;
■ a way to reduce financial risk for the companies
■ a way to increase chances of success with the new p roduct
■ a way to have the buy-in of all stakeholders within a company
Stage-Gating Model
2
1
3 4 5
Discovery
Scoping Business Case
Development Test & Validation
Launching
Post Launch Review
6
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Gates■ Gates are positioned at key decision points in the product innovation process
in order to make an assessment of the project.
■ Questions (to be answered are each gate)
■ Quality of execution : Was the previous stage execut ed with the required quality level ?
■ Business Rationale : Is the project still attractive on an economic and business perspective ?
■ Action plan : What is the action plan and the requir ed resources to perform the next stage ?
■ Decision (to be decide are each gate
■ At each gate the decision can be : Go, Kill, Hold o r Recycle
■ Structure■ Deliverables : What was delivered by the project te am following the
previous stage.
■ Criteria : Metrics on which the project is judged fo r the Go/Kill/Hold/Recycle decision and projects are prio ritized.
■ Output : Result of the gate review (Go/Kill/Hold/Rec ycle); an action plan for the next stage; a list of deliverable for the next gate and a date for the review.
Stage-Gating Model2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
7
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stages■ A stage is a predefined step in the product innovation process:
1. Discovery2. Scoping3. Business Case4. Development5. Testing & Validation6. Launching7. Post-Launch Review
■ A stage is executed based on the action plan decide d at the previous gate.
■ A stage is a set of cross-functional and parallel activities performed by a team of people from different functional areas in a comp any.
■ Approach1. A stage is composed of activities (done by the people from the functional areas)
2. These activities are integrated in a common analysi s3. The result of this analysis is outlined in the deli verables for the next gate.
Stage-Gating Model2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
8
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 0 : Discovery■ The first step in all innovation project is to have an idea on what
to work on.■ Idea Generation Activities
■ Stimulate creativity
■ Brainstorming
■ Group Thinking exercise
■ Look internally for ideas■ Management team
■ R&D Experts and Designers
■ Testing Engineers
■ Manufacturing Technicians
■ Etc.
■ Look outside the company for ideas■ Customers & Lead Users
■ Suppliers
■ Competitions
■ Products outside the company normal market
■ Etc.
Stage-Gating ModelDiscovery
Not all companies have formal activities to generate product ideas but ways exist to stimulate creativity…
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
9
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Gate 1 : � This gate is to formally present an idea to the exe cutive
team to get the authorizations to proceed with the first stage ���� Scoping
■ Stage 1 : Scoping■ Evaluate the idea
■ The product itself
■ The targeted market
■ The business opportunity
■ What are the product strengths & weaknesses ?
■ What would be competition ?■ What are they doing ? Their current focus ?
■ In which market ?
■ What could be the threat ?
■ Why should the company invest in this idea ?
Stage-Gating Model
1
Scoping
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
10
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 2 : Business Case■ Step 1 : Product Definition and Analysis
■ What creates value for the client ?
■ Market Analysis (size, segmentation, trends, sales channels)
■ Competitive Analysis (Technology Gap, Market Share, Business Strategy)
■ Technical Concept (PRD)
■ Current Patents Analysis (which patents could have an impact ?)
■ NRE + Manufacturing + Product Launching Costs Estim ates
■ Step 2 : Building the Business Case■ Result of Step 1
■ Legal & Regulatory Requirements
■ Health, Safety and Environment considerations
■ Assumptions used for the analysis & Out-of-bounds c riteria
■ What is the window of opportunity ? (how much time do we have ?)
■ Step 3 : Building the project plan■ Schedule, Budget and required resources
■ Step 4 : Feasibility Review
Stage-Gating Model
Very difficult stage based on anticipation and
consuming a lot of resources
2Business
Case
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
11
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 3 : Development (technology & marketing)■ Execute what was decided in the previous stages
■ Focus on the technology and align the marketing
■ Do not forget to develop your manufacturing process
■ Do not forget the Maintenance, Support & Logistic A pproach
■ Perform specific pre-launch activities
■ Define key milestones for interim decisions/re-alig nment
■ Use a structured technology development process■ V-Model or else
■ Keep it as lean as possible
■ Use people from all areas of the company■ Engineering, Production, Procurement, Logistics, CM , Etc.
■ Use a structured project management process■ Project Management Institute (PMI)
■ Use prototypes to validate concepts■ technology and marketing
Stage-Gating Model
Execute what was previously decided and planned
3 Development
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
12
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 4 : Testing & Validation (technology & marketing)■ Evaluate what was done previously
■ The technology itself
■ The manufacturing process & approach
■ The maintenance and support concept (ILS)
■ Evaluate customer acceptance■ Use lead user or key customer to get their inputs
■ Fully test/validate what was done■ Near Testing
■ Test the product including the technology (bugs)
■ Field Testing■ Have it tested by customers (in a controlled enviro nment)
■ Market Testing (optional)■ Test your launching plan in a controlled market
■ Only required because you have doubts ���� could jeopardize your strategy by giving information to your competition !
Stage-Gating Model
4Test &
Validation
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
13
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 5 : Product Launching■ Finalize and execute the marketing strategy
■ Create market awareness
■ Generate market demands (before launch)
■ Announce launching date
■ Finalize collaterals
■ Have adequate and sufficient marketing units to support market requests
■ Last chance to decide on the price !!!
■ Train the sales channels (internal & external)
■ Train the support team
■ Manufacture your initial production run■ Based on the anticipated market share
■ A mitigation plan is a good idea if you have more d emand than anticipated.
Stage-Gating Model
5 Launching
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
14
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Stage 6 : Post Launch Review■ Review if the project/product objectives have been reached in
order to have a continuous improvement approach.
■ Objectives■ To instill a culture of accountability for results
■ Use metrics for all team members
■ To have performance metrics measuring how well a ne w product project performed■ Are the profits on target ?
■ Was it launched on time ?
■ To build-in learning and improvement
■ Focus on fixing the cause rather than putting a ban d-aid on the symptom, or worse, punishing the team.
Stage-Gating Model
Post Launch Review
2
1
3 4 5
Discovery
Scoping Business Case
DevelopmentTest &
ValidationLaunching
Post Launch Review
15
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
Stage-Gating Model ���� Adaptation & Flexibility
Discovery
2 3 4 5Scoping Business Case
Development Test & Validation Launching
1Scoping &
Business CaseDevelopment
& Testing Launching3 5Post Launch
Review
Scoping & Business Case
Development, Testing & Launch3
Major New Product Development
B
A
C
B
A
C
Improvements & Modifications
Sales Forces & Marketing Requests
16
Implementing an Innovation Process
This document may contain information which is confidential and can not be reproduced --- Guy Laliberté, 2010
■ Winning at New Products: Accelerating the Process from Idea to Launch■ Author: Robert G. Cooper
■ Product Innovation and Technology Strategy■ Author: Robert G. Cooper & Scott J. Edgett
■ Strategic Business Planning■ Author: Geoff Linton
■ Diffusion of Innovations� Authors: Everett M. Rogers
References