© 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

Agile-Stage-Gate

Using Agile in Manufacturers’ New-Product Development

Processes

Agile + Stage-Gate

ISBM Members Conference

Marketing Excellence Roundtable

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

ISBM Distinguished Research Fellow, Penn State University, USA.

Professor Emeritus, McMaster Uni, Canada

2© RG Cooper & Associates Inc

Private and Confidential

Why Agile for Manufacturers?

q Accelerate the development processq Get the product right… first timeq Was already giving good results in IT departments since 2000

4.2

4.2

4.2

4.4

4.4

4.5

1 2 3 4 5

Improved focus on the project-- better prioritization

Higher morale on team

Better fit between the workprocess & methods

Improved productivity

Improved teamcommunication &…

Flexibility of design -- fasterresponse to change

Benefits ExperiencedTo a small degree

To a high degree

Early Case Study of 5 EU Firms (2014)

3© RG Cooper & Associates Inc

Private and Confidential

Another Reason: Digital Transformation

q Smart products with embedded software q Embedded software now 29% of manufacturers' new productsq Example: Volvo Construction

q How to handle these projects with IT people & engineering peopleØ Each using a different system, different cultures

q One option: Split the project, run as two separate projectsq Another option: a hybrid model → Agile-Stage-Gate

4© RG Cooper & Associates Inc

Private and Confidential

WOW! Performance Improvements with Agile: Actual Vs. Expected Results

(2018 DE Study of 228 EU Manufacturing Firms – Mostly Engineering)

3.1

2.9

2.7

3.0

3.0

3.0

3.1

2.6

2.4

2.8

2.5

2.5

0 1 2 3 4

Increased flexibility toreact to changes

Increased productivity ofdevelopment project

Reduced project risk (techfeasibility; project failure)

Improved teammorale/motivation

Improved adherence toschedule

Shorter productdevelopment (time to

market)

Value of Agile

Actual Value

Expected Value

Hardly Any Value

Very Large Value

Source: Schmidt, Weiss & Paetzold, “Agile Development of

Physical Products”, 2018

5© RG Cooper & Associates Inc

Private and Confidential

Let’s Look at Agile Methods

q Agile for software relies on:1. A focus on the customer – understand the customer’ s problem2. Welcoming change – learn something with each iteration

• A time-boxed iterative approach – sprints: 2-4 weeks • Deliver something of value after

each iteration: test & learn• Evolutionary development (Product

Definition changes as development proceeds)

• Adaptive planning: rapid & flexible response to change: the Plan changes

3. People interacting (vs. following a process)

• Align with objective & the solution• Empowered team – autonomous

q A dedicated team: 100% working on this one projectØ Co-located (all people in one room )

•

24 h

2-4 WEEKS

IDEASPRINT

24 h

2-4 WEEKS

CONCEPTSPRINT

24 h

2-4 WEEKS

DEVELOPMENTSPRINT’

Design ThinkingVoC Models

SimulationsVisualizationsVirtual Reality

ProtoceptsPretotypes

6© RG Cooper & Associates Inc

Private and Confidential

Traditional project: defined target, fixed planAgile-Stage-Gate: Target = Evolving product definition

Plan is fluid & changing

7© RG Cooper & Associates Inc

Private and Confidential

Agile-Stage-Gate: Scrums, Sprints, Demos & Retros

q A sprint is the basic unit in Agile-Scrum:Ø Sprints last 1-4 weeks Ø Are a "time-boxed" (i.e. restricted to a

specific duration) effort of a constant lengthq Each sprint is starts with a team meeting

Ø The Sprint Planning MeetingØ Agree on sprint goalsØ Map out sprint tasks

q Daily “stand-ups” or scrumsØ 15-20 mins to organize each day Ø Set priorities, shift responsibilities, knowledge management, learning

q And followed by a demo & retrospective meetingØ Demo: Where completed work (e.g. a model) is demo’d to stakeholdersØ Retrospect: Where progress is reviewed & lessons are identified.

A daily scrum meeting. This choice of location lets the team start on

time

8© RG Cooper & Associates Inc

Private and Confidential

Now Used by Manufacturers: Example – Chamberlainq Uses sprints & scrums for physical & IT developments

Ø Daily scrums, about 20 minutesq Build in design reviews into some scrums

Ø Bring in peers (peer review) & outsiders too

q Scrum Master in placeq Sprints:

Ø About 2 weeks in length, now 3 weeksØ Must show something physical, the

result of a completed task (not just a PPT show, but for example, design drawings)

q Project teams have dedicated team members per projectq Only use for larger, major revenue generator projects – about 20% of totalq Working well, 6 years intoq Problems: project leader & team loses sight of ultimate goals, just focused

on the next 2 weeks

9© RG Cooper & Associates Inc

Private and Confidential

Field Trails, Customer Tests, Trial Operations:

• Technical (RD&E)

• Production• Marketing/Sales

Customer/User Iteration & Feedback

Stage 4: Testing

G5

Go to Launch

VoC & Customer/

User Feedback

Build Business

Case:• Technical• Marketing• Production

Stage 2: Business

CaseG3

Go to Development

VoC & Customer/

User Feedback

Generate Ideas:

• Technical• Marketing• Others

Ideation G1

Idea Screen

Post Launch: Product, production & marketing/sales improvements

Start Production& Selling:

• Technical (RD&E)

• Production• Marketing/Sales

Customer/User Adoption &

Use

Stage 5: Launch PLR

Post-Launch Review

Go to Business

Case

VoC & Customer/

User Feedback

Stage 1: Concept G2

Concept Developme

nt & Scoping:

• Technical• Marketing• Production

Agile sprints (green) and feedback loops to customers (red)built into each of the 5 stages

Go to Test

Customer/User

Iterations & Feedback

Create the Product:

• Technical (RD&E)

• Production• Marketing

Stage 3: Develop-

mentG4

10© RG Cooper & Associates Inc

Private and Confidential

Demos with Protocepts

q Protocepts can be…Ø Simple, easy-to-build models (paper,

cardboard, clay, wax)Ø Drawings and sketchesØ CAD drawings & 3-D CAD drawingsØ A series of MVPs (something that actually functions)Ø Rapid prototypes, 3D printedØ Crude working modelsØ Early prototypes, pretotypesØ Computer simulations, computer animationsØ Virtual & Augmented Reality

q Anything to test the proposed product before & during DevelopmentØ Technically – can we develop and/or

make it?Ø Market-facing – does the customer like it? GE Tests 3-D Printed Turboprop

11© RG Cooper & Associates Inc

Private and Confidential

Examples

q Fed Ex tests protocept drop-boxes (cardboard) using VRØ Quickly, low laborØ In users’ own home environment…. much more realistic than in the Lab

https://www.invisionapp.com/inside-design/vr-user-testing/

q Volvo trucks tests new construction vehicles that don’t yet existØ A real driver drives the off-highway vehicle in a simulatorØ “A lot cheaper & faster to develop the software than the truck”

12© RG Cooper & Associates Inc

Private and Confidential

Example: Agile-Stage-Gate at LEGO-Education

LEGO Education:• Software & physical products for education for children• Began highly innovative NP project, “Story Starter” in 2011

Project managed using LEGO’s tried-and-proven stage-and-gate model

• Did not fit well with the design iterations – moved slowly

Decided to incorporate a digital documentation software tool• Digital Solutions group already used Agile methods for Software• Joined the Story Starter team, brought Agile with them

Story Starter team decided to try new Agile approach for managing the entire project

Management did not want to lose the strategic benefits of SG • Kept SG while implementing Agile within the gating system. • Agile-Stage-Gate hybrid emerged – for software & physical components

Source: Cooper & Sommer, JPIM, 2016

13© RG Cooper & Associates Inc

Private and Confidential

q Began using this new Agile-Stage-Gate hybrid modelØ SprintsØ 15-minute daily stand-up meetings (scrums)Ø Visual scrum boardØ Daily activity logs A prioritized project backlogØ Sprint planning meetings

q A-SG used during Development phase &continued into the Implementation phase in LEGO’s gating model

q Result:Ø Story Starter project saw a remarkable accelerationØ Immediate increase in productivityØ Much better team communication & a decrease in misunderstandingsØ Improved work-flow each day – problems solved at the next morning’s scrum

meetingq Resulted in the launch of this highly successful & innovative new

product just 12 months later!

Agile-Stage-Gate Hybrid at LEGO Education

14© RG Cooper & Associates Inc

Private and Confidential

Summary for Manufacturers: The Team, Tools & Procedures

q Stages broken down into sprints: 2-4 weeks long q Sprint works from a Sprint Backlog:

Ø Lists the tasks: priority features, knowledge gaps to be filled, or tasks to be completed in the sprint

Ø Created at the Sprint Planning Meeting (start of sprint)q Regular scrums or stand-ups – daily, or 2-3 times/week

Ø 15-minute time-boxed event for the Development Team Ø To synchronize activities & create a plan for the next 24 hours

q Sprint progress is monitored via a burndown chartØ Tasks versus timesØ On a scrum boardØ Also may show Kanban board & Backlog chart

q Agile-Stage-Gate teams are dedicated (ideally, or ‘focussed’)Ø Only working on this one project.

q Co-located in a dedicated project room (ideally)Ø Where the team is physically located

15© RG Cooper & Associates Inc

Private and Confidential

More Recent References, Additional Reading & Sources: 2016-20191. Cooper, Robert G., “Beyond Stage-Gate: What’s Next in New-Product Development”, CIMS Innovation Management

Report, May/June 2016, pp. 4-8.2. Cooper, Robert G., “Agile-Stage-Gate Hybrids: The next stage for product development” Research-Technology

Management, Jan 2016, 59, 1, pp 1-9.3. Cooper, R.G. and Sommer, A.F., “The Agile–Stage-Gate Hybrid Model: A Promising New Approach and a New

Research Opportunity” Journal of Product Innovation Management, 33, 5 Sept 2016, pp 513-526.4. Cooper, R.G. and Sommer, A.F., “Agile-Stage-Gate: New idea-to-launch method for manufactured new products is

faster, more responsive” Industrial Marketing Management, vol 59, Nov 2016, pp 167–180.5. Cooper, Robert G., “Next in New-Product Development: Agile-Stage-Gate Hybrids”, CIMS Innovation Management

Report, Nov-Dec 2016.6. Cooper, Robert G., “Idea-to-Launch Gating Systems: Better, Faster, and More Agile,” Research-Technology-

Management Jan-Feb 2017, 60, 1, pp 48-52 7. R.G. Cooper, “Meeting the Challenges of Agile-Stage-Gate – Part I”, CIMS Innovation Management Report, Sept-Oct

2017, pp 6-10.8. R.G. Cooper, “Meeting the Challenges of Agile-Stage-Gate – Part II”, CIMS Innovation Management Report, Nov-Dec

2017, pp 7-12.9. Cooper, Robert G. (2018), “Best Practices and Success Drivers in New-Product Development” in Handbook of

Research on New Product Development, Peter N. Golder and Debanjan Mitra, editors, Edward Elgar: Northampton, MA, USA.

10. Cooper, R.G. & Sommer, A.F., Agile–Stage-Gate for Manufacturers – Changing the Way New Products Are Developed”, Research-Technology Management, March 2018

11. R.G. Cooper, A. Dreher & P. Fürst, “How Agile Development Works For Manufacturers”, Parts 1 and 2. CIMS (Center for Innovation Management Studies) Management Report, March & May 2019.

12. R.G. Cooper, Winning at New Products: Creating Value Through Innovation, 5th edition, New York, NY: Basic Books, Perseus Books Group, 2017. On Amazon