Managing Short Product Cycles
Lighting Fixture Design Conference
June 2014
Brian [email protected] & Applied Science
London - June 2014Lighting Fixture Design Conference
Agenda
Tools & Techniques
MyBackground
Time toMarket
References
London - June 2014Lighting Fixture Design Conference
One MonthDelay
1% SalesDecrease
1% Design CostOverrun
1% ProductionCost Overrun
Source - Reinertsen 1992
Time to Market
Benefits –
• Improve Quality• Resource
availability
• Reduce Costs• Resource
allocation optimized
• Market Advantage• Hit ‘hot markets’
London - June 2014Lighting Fixture Design Conference
Project Failure Rate
1990 1995 2000 2005 2010 20150%
10%
20%
30%
40%
50%
60%
Success
Polynomial (Success)
Challenged
Polynomial (Challenged)
Fail
Polynomial (Fail)
Year
Pe
rce
nta
ge
of
Pro
jec
ts
Source: Standish Report, Chaos Report
London - June 2014Lighting Fixture Design Conference
1. Delivering the Wrong Project– User involvement in requirements & Specs
2. Inadequate Management Support– Priority and corporate commitment
3. Scope Creep– Lack of scope control
4. Poor Project Management
5. Inadequate Timing– Either too long or too short
6. Poor People Skills– Internal & external to the team
7. Inadequate Resources
All easily fixed – so why aren’t they?
Reasons Projects Fail
Source: Standish Report, Chaos Report
London - June 2014Lighting Fixture Design Conference
My Background
London - June 2014Lighting Fixture Design Conference
The Challenges
Sustainability- Hype- Cost
Customer Expectations- Range- Reliability
New TechnologiesNew Markets
Fast Time-to-Market
Opportunity & Threat
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Finish First
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Finish First
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Launch
Fast Follower Strategy
Soft Launch
Kaizen & Kaikaku Improvements
Launch Support
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A fast follower strategy balances the risks associated with innovation, against the loss of first mover advantage.
Innovative companies are more profitable, but require greater investments and are exposed to greater risk of product or market failure.
Fast followers can use competitors to open the market and follow with superior service. Microsoft adopts a fast follower strategy, compared to Apple Computers innovation strategy.
Fast Follower Strategy
Innovators
Fast Followers
Launch Risk
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A soft launch allows fast time to market, with a robust, but less than fully featured product.
Cost exposure is controlled with limited market release and restricted volume.
Toyota adopted this policy for introduction of the Prius hybrid, which went through four generations in 10 years and was limited to <100k units/yr out of 7 million annual production until it was fully developed.
Volume ramps up once market is matured and product proves viable.
Soft Launch
Ann
ual V
olum
e
Start of Production
Time
Soft Launch
Full Volume
London - June 2014Lighting Fixture Design Conference
Once launched, products need scheduled updates and improvements for cost, quality and marketing reasons.
Changes should be aligned to key points e.g. model year updates, and be continuous incremental improvements (quality) and/or occasional step change improvements.
Improvement schedule should be planned as part of lifecycle planning, minimizing reactive changes to manage cost and investment write-off.
Improvements
AB
AB
Kaikaku – Radical, Dramatic Improvement
Kaizen – Continuous, Incremental Improvement
London - June 2014Lighting Fixture Design Conference
Initial care support for high risk launches (new technology, new markets, etc.), can provide customer confidence, manage brand perceptions with early issues and feedback valuable initial, real-world data on usage.
Rapid customer issue response is essential, including technical team support for field issues, dealer training and seamless repair/replace in the event of issues.
Early adopters are potentially highly valuable members of the development team, as well as evangelists for the brand.
Launch Support
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Configuration
Product Lifecycle
Parallel Developments
Modularity
De-coupling
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Plan product lifecycle, including decline and death.
Variant introduction, upgrades and replacement strategy must be in place prior to the start of concept design, let alone investments in tooling, in order to minimize unplanned write-off or replacement and maximize return on investment.
Plan complete portfolio of products to balance resource allocations and launch risk.
See Fujimoto, Reinertsen
Product Lifecycles
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Pressure to minimize product development costs leads to reducing options early in the NPD process and developing a single configuration.
Set-based design, as used by Toyota and many other Japanese companies, develops viable alternative options to a late stage, allowing optimal product selection at point of launch.
Development costs are higher, but more than compensated by launching on time and with the right product for the market.
See Sobek & Ward
Parallel Developments
Option ‘A’
Option ‘B’
Option ‘C’
Time
Pro
duct
Opt
ions
Product Launch
Option ‘A’
Option ‘B’
Option ‘C’
Traditional Model
Parallel Model
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Modularize products, systems and components to reduce risk. Use proven components from supply base.
Reduce launch risk with minimal new components, concentrating on customer observable features and benefits.
Component/feature level reuse improves economies of scale, reduces development costs and launch risk.
See Ulrich & Eppinger
Modularity
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Features and systems are de-coupled to stagger launches, reducing cost and risk, whilst enabling product refresh.
Highly coupled products may allow more optimal features, but come with considerable launch risk/cost. Evaluate risk/benefits of coupled features to manage risk.
Mitigate high risk through de-coupling designs at the concept and configuration stage. Lifecycle plans for products, systems and features, will enable product launch risk management.
See Ward, Fujimoto
De-coupling Features
Body
Engine
G’Box
Time (Model Years)
Sys
tem
Lau
nche
s
Launch Separation
Body
Engine
G’Box
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Lean & Agile
Voice of Customer
Agile Start-up Mentality
Concurrent Engineering
Testing & Validation
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The voice of the customer needs to be at the heart of every activity.
Formal processes, such as QFD (Quality Function Deployment) and VSM (Value Stream Mapping), can be used to identify what adds value in an organization's activities and products.
Care should be taken with focus groups and customer feedback/surveys, as these require careful interpretation. Consider use of direct observation (industrial anthropology) and tap into internal and external expert opinion.
See Taguchi, Ohno
Voice of Customer
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Engender a ‘start-up culture’ in your NPD teams. Give then resources, an overall objective and then get out of their way.
Empower the team to succeed by giving them ownership and remove barriers, especially bureaucracy that adds little value.
Identify all the things you currently do that you don’t need to do – and stop doing them! This generates the resources and capacity to work on new, high value work.
Fail often, Fail early.
Agile Start-up
Agile Process
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Concurrent or simultaneous engineering involves key stakeholders (suppliers, manufacturing, customers, legislative bodies, etc.) being active participants in the product development process.
Where possible, geographically co-locate the team. Establish a virtual collaborative environment for dispersed teams. Delegate authority and align performance assessment with project success.
See Sobek & Ward, Clark & Wheelwright
Concurrent Engineering
Num
ber
of C
hang
es
Start of Production
Time
‘Over –the-Wall’Engineering
ConcurrentEngineering
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Closely linked to knowing your customer, is the definition of appropriate sign-off criteria (validation testing). Industrial anthropology will define expected life and in-service environments.
Robust/appropriate testing reduces warranty cost and protect brand value. Avoid over-test, as this increases product cost for no added customer value.
The Taguchi loss curve can be applied to optimize the cost-of-quality and ensure testing adds value.
Long term testing can extend post-launch, as used in aerospace industry.
Testing & Validation
Des
ign/
Test
Pha
ses
Start of Production
TimeExtended Life Testing
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Project Management
Risk Management
Leap-frog Development
Capacity Utilization
Knowledge Management
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Successful project management is all about managing risk. Identify risks based on prior experience, expert opinion and scenario planning. Categorize risk by likelihood of occurrence and severity of impact.
Mitigate high risks, track moderate risks and accept low risks.
Risk mitigation strategies include:• Transfer/Insure• Eliminate/Avoid• Reduce/Accept• Alternative/Fallback
Risk Management
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One method of compressing development times, is to ‘leap-frog’ design updates and changes to miss the immediate next phase.
This allows greater overlap of phases and more iterations of design prior to launch.
Careful tracking of design iterations and component test level is required to manage this activity, but it allows reduced waiting/lead time of prototypes.
See Reinertsen
Leap-frog Development
Time
Des
ign/
Test
Pha
ses
Time Compression
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Thoroughly understand the capability, capacity and availability of all resources at your disposal (people, equipment, facilities, etc.).
Apply resources ensuring there is a critical mass to succeed. Queuing theory suggests max. load capacity should be ~70% to account for contingency and unknowns.
Front load resources on projects. Fewer projects, better resourced, ensure more success than teams spread too thinly.
See Goldratt
Capacity Utilization
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Maximize knowledge capture and reuse through formal, structured systems. Encourage creation and dissemination of knowledge through valuing learning, competition (‘X’ Prize) and intellectual property bounty.
Utilize project collaboration sites and document repositories for information storage and retrieval – especially for dispersed teams and concurrent engineering environments.
Knowledge Management
Data Information Experience Knowledge Wisdom
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Questions?
London - June 2014Lighting Fixture Design Conference
Bicheno. J. & Holweg. M., 2009. The Lean Toolbox. PICSIE Books
Brophy. A., 2013. Lean. Financial Times Guides
Clark. K. & Fujimoto. T., 1991. Product Development Performance. Harvard Business School
Collins. J., 2009. How The Mighty Fall. RH Business Books
Cooper. R., 2001. Winning at New Products. Basic Books
Goldratt. E., 1992. The Goal. North River Press
Haik. Y. & Shahin. T., 2011. Engineering Design Process. Cengage
Kendrick. K, 2004. The Project Management Tool Kit. AMACOM
Omerod. P., 2005. Why Most Things Fail. Faber & Faber
Oosterwal. D., 2010. The Lean Machine. AMACOM
Pandey. V., 2014. Decision Based Design. CRC Press
Reinertsen. D., 1997. Managing the Design Factory. The Free Press
Trott. P., 2012. Innovation Management & New Product Development. Pearson
Ulrich. K. & Eppinger. S., 2008. Product Design and Development. McGraw-Hill
Womack. J. & Jones. D., 2003. Lean Thinking. Simon & Schuster
Womack. J., Jones. D. & Roos. D., 1990. The Machine That Changed the World. Macmillan
Wheelwright. S. & Clark. K., 1992. Revolutionizing Product Development. The Free Press
References
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