1 cl npd process evaluation yanyi wang nyu mastering new product and service process fall 2004

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CL NPD Process Evaluation

Yanyi WangNYU Mastering New Product and

Service Process Fall 2004

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Table of Contents Company’s vision, mission and strategies

review The current NPD process Evaluation of the process Recommendations The next steps Questions and comments

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CL Company vision, mission statement and strategies review

VisionContinue to be the world leader in promotional accessories; be perceived as the preferred supplier in our marketplace

Mission statementOur sales force and designers offer the leading Beauty brands around the world their own creative and original designs the most innovative and cost effective solutions to meet all their development needs

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CL Company vision, mission statement and strategies review (cont.)

Strategies Increasing the speed of NP to market Mixing our capacity of developing new technology

and competitive manufacturing cost offered by our Asian factories

Increasing industrial presence in Asia, especially China by acquiring manufacturing infrastructures

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Discovery

Gate1 Gate2 Gate3 Gate4

Stage 1

Stage 2

Stage 3

Stage 4

Ideation Scoping Development Testing/

Validation

Production

CL current NPD process

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Evaluation of the current NPD process

What went wrong? NP failed to meet the needs of clients Higher cost than anticipated Technical or production problems Competitors are faster

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Evaluation of the current NPD process (cont.)

24%

16%

14%

10%

9%

8%

6%

13%

0% 5% 10% 15% 20% 25%

Inadequate market analysis

Product problems or defects

Lack of effective marketing effort

Higher cost than anticipated

Competitive strength or reaction

Poor timing of introduction

Technical or production problems

All other

Source: Robert Cooper “Winning at new products”

Main causes of NP failure

“Lack of market information remains the number one cause of product failure!”

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Source: Robert Cooper “Winning at new products”

What is missing in your current NPD process? Predevelopment step

“The greatest differences (between winner and loser) lie in the first few steps of the new product process – the upfront or predevelopment steps.”--Rober G. Cooper

Quality of execution

“Doing projects right” and “Doing the right projects.“ --Rober G. Cooper

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What does it mean? Limited idea generation sources (mainly from designer’s brain) No set up process for ideation system Lack of preliminary business and financial assessment Lack of product benefits to customers Lack of market investigation and study Lack of cost investigation

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Recommendations Companies that follow a multistage, disciplined new product process—a Stage-Gate process—fare much better.

The benefits of using Stage-Gate process: Faster new product introductions Less recycling to redo steps Higher success rate of launched products

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Recommendations

Stage-Gate process

Stage 1

Gate2 Gate3 Gate4 Gate5

Stage 2

Stage 3

Stage 4

Stage 5

Scoping Build

Business

case

Development Testing/

Validation

Go/Kill

Discovery

Gate1

Post

LaunchReview

Launch

Strategy clarification

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Recommendations

Stage-Gate process description Strategy clarification to define focus of

efforts assessing customers industry estimate future trends Conducting internal analysis (SWOT)

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Recommendations Stage-Gate process description

Discovery stage (idea generation)

Voice of customer, lead user Designer Sales force Marketing Competitors Trade publications suppliers

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Gate 1 (idea screen) -- a gentle selection of ideas

in line with our strategic focus? add value to our customers? feasible to manufacturing? fit for market trend?

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Stage 1 (scoping) “spend a little money, gather some information, so that the project can be re-evaluated at Gate 2 in the light of the better information.” Preliminary market assessment (internet searches,internal

reports, key customers, focus group, own people, consulting, advertisements)

Preliminary technical assessment (R&D, engineer, operation)

Preliminary business and finance assessment (find out the investment required, probable annual income, ROI)

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Recommendations

Stage-Gate process description

Gate 2 –repeat Gate 1 with more information gathered in Stage 1 Sales force Customer reaction to the product Legal marketing Technical

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Stage 2 (building business case)—critical define the new product (do we meet the customer’s needs, wants and

preferences; market reaserch) competitive analysis (possible reactions) manufacturing appraisal (manufacturablility, cost and investment

required) detailed business and financial analysis (justification, sensitivity

analysis to look at possible downside risks)

Result: -the product definition (the key to success)-project justification -detailed project plan are developed

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Gate 3 financial analysis result is important criteria Confirm the case Go to the development stage—heavy spend!

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Stage 3 (development) –a prototype Technical work Market analysis and customer feedback work continually Customer assessment and feedback Developing detailed test plan, production plan

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Gate 4 (go to testing decision) Review the product Check consistency with the original definition set at Gate 3 Revise financial analysis with more accurate data Approve test and validation plan for Stage 4 Review marketing plan

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Recommendations


Stage 4 (testing and validation) pilot module In house testing Customers acceptance for external validation Revise business and financial analysis

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Recommendations


Gate 5 (go to launch) Focus on result and quality of execution of testing and

validation stage Financial return review

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Recommendations


Stage 5 (launch) --mass production

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Recommendations


Post Launch Review review the lastest data on revenues, costs,

expenditures, profits, and timing Post audit of the project’s strength, weakness and

lessons learned How can do better next time

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The next steps

Understand how Stage-Gate process works Assign a project manager for implementation

of the new process

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Questions and comments

1 cl npd process evaluation yanyi wang nyu mastering new product and service process fall 2004

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