New Product Development

Keiko Taguchi4/19/03

Agenda Vision Mission Goal & Strategy New Product Process New Product Process Description New Product Concept

Vision Plan and develop software

products that have potential to be essential infrastructure relating to banking industry and government. The software should contribute to enhance, shorten or ease current and future procedure and/or system

Mission Mission of my group is to plan new

software product for multi-application smart card, which can be used with payment software.

The new product should be used for business purpose, and should have synergy effect with current products, fingerprint authentication software and electric purse software, and expand current market.

Goal & Strategy Goal

More than $1,000,000 sales Strategy

Acquire new customer who use cards for business purpose

Provide new or enhanced products to existing customers and extend market

Percentage of failed projects where activity is not undertaken - Statistics

We can learn from the study to improve our new product development process

What should be changed

32%44%

65%51%

77%34%

11%11%

37%75%

15%23%

8%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Initial screeningPrellim market assessment

Prelim tech assessmentDetailed market study

Business/ financial analysisProduct development

In-house product testsCustomer tests of product

Test market/ trial sellTrial/ pilot production

Pre- launch business analysisProduction start-up

Market launch (roll out)

Source : R. G. Cooper and E. J. Kleinschmidt

Source : R. G. Cooper and E. J. Kleinschmidt

10%

17%

17%

21%

24%

28%

31%

34%

34%

0% 5% 10% 15% 20% 25% 30% 35%

Higher success rate & customer satisfaction

Developed on target time, quality & cost

Faster to market

Improved profit performance

A learning tool: educate our people

Improved cooperation / coodination

Fewer errors; less recycling; less redesign

Improved communication

Better project control

What Stage-Gate Can Do Percentage of positive impact with

Stage-Gate process - Statistics

We can improve our new product development process with Star-Gate, for more success and less risk

The New Product Process

Gate 0

Idea Generation

Gate 1 Stage 1 Gate 2

Gate 3

Stage 2

Gate 5Stage 4Gate 4 Stage 5Stage 3 Post Launch

Pilot Testing Launch

Scoping Build Business Case

Development

Next Cycle

Discovery

Description - Gate 0 Guides new product idea direction Company vision and group mission

is the basis

0

Description - Discovery Idea Generation

Generate and store ideas Ideas come from

Sales group Planning group Customer requirements Technical group

D

Description - Gate 1 Check against Broad Criteria

Broad Criteria Product must use smart card Product must be used for business purpose Product must enhance, shorten or ease

current procedure or system Product must have potential to be installed in

government or banking infrastructure system

1

Description - Stage 1 Scoping

Object Spend little money and gather some information

Work Preliminary Market Research Preliminary Technical Research Preliminary Financial/Business Estimation Preliminary Legal Check - Patent

1

Description - Gate 2

Check against Specific Criteria Specific Criteria

Company vision/mission Product must have merit to use “smart” card - not

“magnetic” card. Product should be beneficial when installed with

existing authentication or payment software Market

Product category should have potential market size more than $10,000,000

Product market segment should be in introduction stage

2

Description - Gate 2 Specific Criteria (continued)

Technical Patent must be cleared Product must fit within current smart card memory Product should be easy to install and use for end

users Cycle time for implementation should be less than 1

year Financial

Product sales must be expected to hit $1MM Product payback period should be expected within

2 years

2

Description - Stage 2 Build Business Case

Object Verify the attractiveness of the project prior to

heavy spending Work

Detailed Research In-depth market research

Existing/potential user needs Competitive products

Detailed technical research/assessment Legal research Financial estimation

Define product

2

Description - Gate 3 Careful examination against Broad

Criteria and Specific Criteria “Must-See” Criteria

Agree ; Go and score (3) Disagree ; Kill or return to Idea Bank

“Should-See” Criteria Agree ; Score (1-3) Disagree ; No score

Compare each score and choose top 3

3

Description - Stage 3 Pilot Development

Design and Develop Pilot Software Design software structure/function Design detailed software flowchart and workflow Develop pilot software Internal test

Feedback internal test result User opinion Technical issues Financial data adjustment

Market Launch Plan

3

4

Description - Gate 4 Check attractiveness of the project

Product Features Attract Pilot users as expected in Stage2?

Yes : Go No : if the gap easily correctible, return to Stage 3,

otherwise return to Idea Bank Technology Function

Support features without significant problem as assessed?

Yes : Go No : if the problem easily correctible, return to Stage 3,

otherwise return to Idea Bank Financial Estimation

Financials are sound with attractive price as expected?

Yes : Go No : if the gap easily correctible, return to Stage 3,

otherwise return to Idea Bank

Description - Stage 4 Pilot Testing

Test Pilot Software External pilot test with partner companies

Feedback external test result User opinion Technical issues Financial data adjustment

Market Launch Plan

4

Description - Gate 5

5

Check attractiveness of the project Product Features

Accepted by users? Users are attracted and likely to buy?

Yes : Go No : if the gap easily correctible, return to Stage 3,

otherwise return to Idea Bank Technology Function

Support features without significant problem as assessed?

Yes : Go No : if the problem easily correctible, return to Stage 3,

otherwise return to Idea Bank Financial Estimation

Financials are sound with attractive price as expected? Yes : Go No : if the gap easily correctible, return to Stage 3,

otherwise return to Idea Bank

Description - Stage 5 Product Launch

Execute marketing plan

5

Description - Post Launch Keep researching user acceptance Keep watching competitor's

movement Feed back the result for next cycle

PL

Next Step After new product development

process is approved here… Design and assign teams for each

stages and gates Implement new process Head for success