New Product Development Group: New Stage Gate Process

Prepared by:Karyn Liane DobinApril 19, 2003

“Houston…we have a problem”

We have no process Ok, we have one but it doesn’t work What would work?

Overview of Discussion

Establish a Vision and a Mission Set Goals and Strategies Research Factors for defining NP Process Must haves for NP Performance Stage-Gate Process Next Steps

NPG Vision

To be the global market leader in developing new financial market data delivery platforms that meet and exceed our clients needs

NPG Mission

Determine where our new product development process has failed, what changes in the process need to made, and successfully implement those changes in order to fulfill our Vision

NPG GoalsRe-organize Product Marketing and Management team into a superior team that believes in the new processDetermine business lines for NPG focusDiscontinue distribution of product platforms that don’t meet revenue targetsCreate products that meet our clients needs and have real potential to meet our revenue targetsEnsure our data content provided is #1 or #2 in the marketAlways be ahead of our competition in utilizing new technology to deliver market data products to our clients

NPG StrategiesMeet with Executive team and ensure their full support in implementing a new process Define what businesses within the market data distribution industry we want to be inResearch those businesses, and ensure there is potential to make a profit that meets our revenue targetsConduct research to determine clients needs within those business linesDetermine what clients want to pay for those servicesDetermine if we can create products within our budget that will meet our clients needsDetermine if we can deliver product at a cost that would meet company profit targets

NPG Strategies

Basically, create a winning process from idea to launch

Factors for defining New Product Process

Understand our user needs Establish products strategic alignment with strategy of

Moneyline Telerate Complete a competitive analysis and establish product

superiority Create priority decision criteria list Risk assessment Product positioning Establish product channel and support Ensure product is endorsed by upper management Get total organizational support

Marketing Research Needed Earlier

Do a Product Failure StudyDo a Product Success StudyCompare the differences between the twoAdopt a systematic new product processDoing the projects right: define the road map from idea to launch and follow it, this way project teams will build in success factor by design, rather than by chanceDoing the right projects: just as important doing the projects right Need extensive and careful analysis of the market BEFORE taking on new products

New Process: Use Stage-Gate

Establish strategic direction

New Idea Generation

Does idea meet strategic direction?

Scope Idea

Specific Criteria Check

Stage 1Stage 1

Gate 2Gate 2 Stage 2Stage 2Stage 3Stage 3 Stage 4Stage 4Gate 4Gate 4Gate 3Gate 3

Gate 5Gate 5

Will clients buy?

Testing and

validation

Ready to go to testing?

DevelopmentIf we build it, will they come?

Build Business case

Launch

DiscoveryDiscovery

Stage 0Stage 0

Stage 5Stage 5

Post LaunchReview

Post LaunchReview

Gate 1Gate 1

Stage 0: Establish Company Strategic Direction

Get company strategic directionProduct failure and success studies, with comparison between the twoGet buy-in from for new process from executive team for new process, including commitment of staff and resourcesDetermine accountability

Stage 0

Stage 0

Discovery: New Idea Generation

Feeding from database of feedback from clients

wish list items Sales feedback Internal suggestions Marketing research

come up with ideas of innovative products

Discovery

Discovery

Gate 1: Does Idea Meet Strategic Direction?

Filter out ideas that don't meet strategic directionGate 1Gate 1

Stage 1: Scope Ideas that passed Gate 1

Do they meet the client need?Can they be built within established budget?Can we bring the product quickly to market?Do we know any competitors currently building similar product?Do we think clients will pay for this?How will this be a solution for clients to make money?Contact small group of close clients and ask them for their opinion

Stage 1Stage 1

Gate 2: Check against Specific Criteria?

Gather a team with accountable representation from development, operations, finance, legal, marketing, and sales, and determine if ideas feasibleWhat does each department need to move forward?Check id idea meets the specific criteria to move forward to building the business case

Gate 2Gate 2

Stage 2: Build Business Case

Do in-depth research and investigationCompetitive analysisSWOT analysisDetermine target marketSurvey marketPositioningPotential profit analysisCost and time frame to buildDefine team to buildDefine responsibilitiesDefine exact features of product, unique sales points

Stage 2Stage 2

Gate 3: If we build it, will they come?

Present business case from stage 2 to the team established in gate 2, and determine if based on information if we think if we build it, clients will buy it and we can meet our revenue goals.

Gate 3Gate 3

Stage 3: DevelopmentIn a parallel process develop:Product

Proto-type Working model Alpha

Operations processHelp desk support processMarketing materialsSales proceduresTest with small group of clients: Are USP importantSurvey clients

Stage 3Stage 3

Gate 4: Ready to go to testing?

Gather the established team, review the developed product, and determine if we feel the product is ready to move forward to the testing stage.Does the product meet the defined goals?Is it stable? Does the market still want this product?

Gate 4Gate 4

Gate 4: Testing and Validation of Entire Process

Marketing ProcessSales ProcessProcess to Deliver to clientsProduct functionalityHelp desk supportOperation supportSurvey clients on success/failure of processes, will they buy?Survey internal processes

Stage 4Stage 4

Gate 5: Will Clients Buy?

Gathering the team, determine if the testing phase was successfulAre we ready to launch?Do clients still want this product?Will they pay for the product?

Gate 5Gate 5

Stage 5: Product Launch

Stage 5

Stage 5

Post Launch ReviewEstablish metrics to determine success:

Where did we make mistakes?

Where did we go off the process?

What did we do right? How should we change

the process for next time?

Final business evaluation to determine if the client met the original goals of market share, profitability and client fit

Post LaunchReview

Post LaunchReview

Must haves for NP Performance

High Quality New Product Process: Steps, activities, and decision points that new products

follow from idea to launch to beyond

New Product Strategy: Set goals/objectives for business total new product effort The role of NP is clearly communicated to all Clearly defined areas for strategic focus NP effort has a long-term thrust and focus

Resource Commitment people and money are committed by upper

management

Next Steps

Get the buy-in from Executive managementPut Stage Gate process in placeDo the research!Build winning productsKeep revisiting the process, to make sure we are on track to meet vision