New Products Management by ewghwehws


									New Products Management

          Chapter 14
 Development Team Management
   Some Terms in New Products
• Functional: People in business departments or
  functional areas are involved, and product
  development activity must mesh with their work.
• Project: The product innovation activity requires
  people who think first of the project.
• Matrix: Two people are likely to be involved in
  any piece of work: project manager and line
  function head.
                                                           Figure 14-1

       Options in New Products
1. Functional
2. Functional Matrix
3. Balanced Matrix
4. Project Matrix
5. Venture
These are listed in increasing projectization, defined as the
  extent to which participants see themselves as independent
  from the project or committed to it.
       Options in New Products
1. Functional: work is done by the various departments, very
   little project focus.
    – Usually a new products committee or product planning
    – Does not lead to much innovation.
2. Functional Matrix: A specific team with people from
   various departments; project still close to the current
    – Team members think like functional specialists.
    – Departments call the shots.
       Options in New Products
3. Balanced Matrix: Both functional and project views are
    – May lead to indecision and delay.
    – Many firms are making it work successfully.
4. Project Matrix: High projectization, team people are
   project people first and functional people second.
    – People may drive the project even against department’s
       best wishes.
    – IBM PC developed this way.
5. Venture: Team members pulled out of department to work
   full time on project.
                                                            Figure 14-3

    Performance Success of the Five
        Organizational Options
Option               Percent of                   Percent
                     Options                      Successful/
Functional              13%                          63%
Functional Matrix       26%                          79%
Balanced Matrix         16%                          88%
Project Matrix          29%                          92%
Venture                 16%                          94%

Similar results found for the teams’ ability to: meet schedule;
control cost; achieve technical performance.
                                                                          Figure 14-4

       Operating Characteristics of the
               Basic Options
Characteristic                       Functional <------------------->Venture
Decision Power of Leader                Low                           High
Independence of Group                   Low                           High
% of time spent on project by member    Low                           High
Importance of Project                   Low                           High
Degree of risk of project to firm       Low                           High
Disruptiveness of project               Low                           High
Degree of uncertainty                   Low                           High
Ability of team to violate
   company policy                       Low                           High
Independent funding                     Low                           High
                                                                        Figure 14-5

              Which Option is Most
Score each on a scale of 1 (low) to 5 (high):
1. How difficult is it to get new products in the firm?
2. How critical is it for the firm to have new products at this time?
3. How much risk to personnel is involved?
4. How important is speed of development?
5. Will the products be using new procedures in their manufacturing?
6. In their marketing?
7. What will be the $ profit contribution from each new item?
8. How much training do our functional people need in the markets
    represented by the new products we want?
Rating: Below 15: functional matrix will likely work.
15-30: a balanced matrix will probably work.
Over 30: You need a project matrix or even a venture!
                  Another View:
        Home Runsprojects: Singles
Characteristics of “home run”
• Distance from regular business -- markets, technologies, distribution
• Conflicts with regular business -- success will threaten people in the
  organization’s regular business (production, sales, technical).
• Major financial importance -- dollars, risk, or (especially) both.
• Timing -- a project that may be a “single” in normal times --
  competition, market change, threatened acquisition, insecure
  management team, shortage of new product projects.
(Do the opposite conditions make for singles?)
The more like a “home run” a project is, the more suited to a
  more projectized organizational structure.
                                                        Figure 14-6

    What Makes a Good Project
• General management         •   Velvet hammer.
  skills.                    •   Stamina.
• Green thumbs.              •   Tom Sawyer skills.
• Blank-page vision.         •   Veterinarian skills.
• One-man band.              •   Ideaphile.
• Hunger; impatience.        •   “Let my people go.”
• Explorer syndrome: can’t   •   Audacious thinking.
  just sit in port.          •   Try, try again.
• Vision improves in dark.   •   Execution overkill.
• Lead from the trenches.    •   Manners.
  Who Are the Team Members?
• Core Team: manage functional clusters (e.g.,
  marketing, R&D, manufacturing)
  – Are active throughout the NPD process.
• Ad Hoc Group: support the core team (e.g.,
  packaging, legal, logistics)
  – Are important at intervals during the NPD
• Extended Team Members: less critical
  members (e.g., from other divisions)
                                                                    Figure 14-7

         Participants in the Product
             Management Process
    Project Manager
   – Leader, integrator, mediator, judge
   – Translator, coordinator
• Project Champion
   – Supporter and spokesperson
   – May be the project manager
   – Enthusiastic but play within the rules
• Sponsor
    – Senior executive who lends encouragement and endorsement to the
• Rationalist
    – The “show-me” person
                                                                        Figure 14-7

         Participants in the Product
•   Strategist
              Management Process
    – Longer-range
    – Managerial -- often the CEO
    – Spelled out the Product Innovation Charter
• Inventor
    – Creative scientist
    – “Basement inventor” -- may be a customer, ad agency person etc.
    – Idea source
• Facilitator
    – Enhance team’s productivity and output

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