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MythsOfProductDevelopment HBR’s 10mustreadsoninnovation
Stefan Thomke ProfessorofBusinessAdministration HarvardBusinessSchool Donald Reinertsen PresidentofReinertsen&Associates T...
Technologycommercializationmanager ExploitTechnologiesPte Ltd (ETPL) Agencyfor Science, TechnologyandResearch (A*STAR, Sin...
Many companiestreat MANUFACTURING product developmentas itwere
The managers WANT ✔Detailed and predictable plans ✗Schedule variations and waste
It works for factories, but backfires with product development
Designing Products Manufacturing Products
Manufacturing is repetitive and predictable
For productdevelopment The output(information) can beanywhere Requirements constantly change The tasks are unique
It is important to appreciate the difference and avoid fallacies
6 There are that undermine product development fallacies
1. High utilizationof resource will improve performance
The managersoverlook variability Of development work
The variabilitycancause delays dramaticallyasutilizationincreases Resource Utilization Waiting Time 50%25% 75% 30x 100%
And, the increased R&D inventory due to delays is predominantly invisiblebecause they largely consistof information
Besidesthecommon solutionto providea capacitybuffer, thereare other viablesolutions Change the management controlsystem Se...
2. Processing work inlargebatches will be more economical
The managers incorrectly believe that large batches produce “economies of scale”
Large batches do reduce the transaction cost, however, they increase the holding cost Transaction Cost HoldingCost
Batch Size Cost Holding Cost TransactionCost TotalCost Optimal BatchSize The optimal batchsize isthepoint where the combin...
OptimalBatch Sizes Astonishing results
3. Teamsneed tofaithfullyfollow theirdevelopment plan
The managers believe that deviations from the plan is poor management and execution
However, many events can disapprove the initial assumptions of the original plan. Newtesting results Unexpected informatio...
For all those reasons, sticking to the original plan can be a recipe for
The plan should be treated as an initial hypothesis that is constantly revised
4. The sooner a project isstarted, the sooner it will be finished
The managersbelieve thatworks startedearly do not need to be done later
Such thinking usuallyleads to Moooooooooore projectsa companycan vigorouslypursue THAN
bite off more than you can chew Don’t
It will causethe dilutionof resource
It will causethe dilutionof resource DANGEROUS And, itis
Resource Insufficient E F Slow Project Progress
Project Duration Cost andschedule overruns Increases Increase Exponentially When …
CONTROL RESIST New project startingrate Temptationto stealresource from ongoing projects We must
5. The more features aproduct has, the better customerswill likeit
Product development teams seem tobelieve that addingfeatures creates valuefor customers
Companies that challenge the belief usuallycreate products thatareelegant intheir simplicity
To do that, the development team needs to definethe problem clearly problem
Itmakesthe team to FOCUS onthe few features that really matterand determine what to hide or omit
6. The project will be more successful,if the team“get it right the firsttime”
Requiring success on thefirst pass biases teams towardthe least-risky solutions
To avoid makingmistakes,teams follow a linear processin which each stageis carefully monitored Go/ NoGo Milestone1 Go/ NoG...
This processcan cause project overrunsbecause the feedback ofthe problem is delayed
Fail early,failoften
Rapid experimentation New information Diverse ideas Crucial to innovation projects i
Summary
6FALLACIES Highutilization Largebatchsize Followingplanstrictly Startingprojects toosoon Too many features The mindsetof t...
Avoid the mistakesand keep projectson track
More presentations at www.innodiary.org
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Six Myths of Product Development

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HBR's 10 must reads on innovation. The negative effects of 6 fallacies abour product development are explained, and practical suggestions to overcome them will help companies to avoid the mistakes and keep projects on track.

Publié dans : Business
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Six Myths of Product Development

  1. 1. MythsOfProductDevelopment HBR’s 10mustreadsoninnovation
  2. 2. Stefan Thomke ProfessorofBusinessAdministration HarvardBusinessSchool Donald Reinertsen PresidentofReinertsen&Associates The authors The full article is available at Harvard business review
  3. 3. Technologycommercializationmanager ExploitTechnologiesPte Ltd (ETPL) Agencyfor Science, TechnologyandResearch (A*STAR, Singapore) B. Eng &Ph.d(Engineering) NanyangTechnologicalUniversity Singapore M.B.A. INSEAD Fontainebleau, France Presentationby LI Wei
  4. 4. Many companiestreat MANUFACTURING product developmentas itwere
  5. 5. The managers WANT ✔Detailed and predictable plans ✗Schedule variations and waste
  6. 6. It works for factories, but backfires with product development
  7. 7. Designing Products Manufacturing Products
  8. 8. Manufacturing is repetitive and predictable
  9. 9. For productdevelopment The output(information) can beanywhere Requirements constantly change The tasks are unique
  10. 10. It is important to appreciate the difference and avoid fallacies
  11. 11. 6 There are that undermine product development fallacies
  12. 12. 1. High utilizationof resource will improve performance
  13. 13. The managersoverlook variability Of development work
  14. 14. The variabilitycancause delays dramaticallyasutilizationincreases Resource Utilization Waiting Time 50%25% 75% 30x 100%
  15. 15. And, the increased R&D inventory due to delays is predominantly invisiblebecause they largely consistof information
  16. 16. Besidesthecommon solutionto providea capacitybuffer, thereare other viablesolutions Change the management controlsystem Selectively addextra resource # Limitthe numberof projects Make R&D inventory “visible”
  17. 17. 2. Processing work inlargebatches will be more economical
  18. 18. The managers incorrectly believe that large batches produce “economies of scale”
  19. 19. Large batches do reduce the transaction cost, however, they increase the holding cost Transaction Cost HoldingCost
  20. 20. Batch Size Cost Holding Cost TransactionCost TotalCost Optimal BatchSize The optimal batchsize isthepoint where the combined holding andtransactioncost islowest
  21. 21. OptimalBatch Sizes Astonishing results
  22. 22. 3. Teamsneed tofaithfullyfollow theirdevelopment plan
  23. 23. The managers believe that deviations from the plan is poor management and execution
  24. 24. However, many events can disapprove the initial assumptions of the original plan. Newtesting results Unexpected information or ideas Shift ofcustomers’ preferences
  25. 25. For all those reasons, sticking to the original plan can be a recipe for
  26. 26. The plan should be treated as an initial hypothesis that is constantly revised
  27. 27. 4. The sooner a project isstarted, the sooner it will be finished
  28. 28. The managersbelieve thatworks startedearly do not need to be done later
  29. 29. Such thinking usuallyleads to Moooooooooore projectsa companycan vigorouslypursue THAN
  30. 30. bite off more than you can chew Don’t
  31. 31. It will causethe dilutionof resource
  32. 32. It will causethe dilutionof resource DANGEROUS And, itis
  33. 33. Resource Insufficient E F Slow Project Progress
  34. 34. Project Duration Cost andschedule overruns Increases Increase Exponentially When …
  35. 35. CONTROL RESIST New project startingrate Temptationto stealresource from ongoing projects We must
  36. 36. 5. The more features aproduct has, the better customerswill likeit
  37. 37. Product development teams seem tobelieve that addingfeatures creates valuefor customers
  38. 38. Companies that challenge the belief usuallycreate products thatareelegant intheir simplicity
  39. 39. To do that, the development team needs to definethe problem clearly problem
  40. 40. Itmakesthe team to FOCUS onthe few features that really matterand determine what to hide or omit
  41. 41. 6. The project will be more successful,if the team“get it right the firsttime”
  42. 42. Requiring success on thefirst pass biases teams towardthe least-risky solutions
  43. 43. To avoid makingmistakes,teams follow a linear processin which each stageis carefully monitored Go/ NoGo Milestone1 Go/ NoGo Milestone2 Go/ NoGo Milestone3
  44. 44. This processcan cause project overrunsbecause the feedback ofthe problem is delayed
  45. 45. Fail early,failoften
  46. 46. Rapid experimentation New information Diverse ideas Crucial to innovation projects i
  47. 47. Summary
  48. 48. 6FALLACIES Highutilization Largebatchsize Followingplanstrictly Startingprojects toosoon Too many features The mindsetof the firsttime right
  49. 49. Avoid the mistakesand keep projectson track
  50. 50. More presentations at www.innodiary.org

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