Lean Product Development Process – Using Stage-Gates to Speed the Development Cycle

Abstract

How many products hit the market and are too expensive, too big, don’t have the desired features or take too long to develop?

Lean is a Process Improvement Tool to reduce waste in organizations. Few processes cross over as many different departments in a company as product development. Product development can include hard-goods, software or new services. As the efforts cross marketing, research, engineering, purchasing, operations and sales there are numerous opportunities for the product development effort to stall or reverse direction. This can be due budget problems becoming visible; product definition being rushed and/or the operational problems.

By applying Lean concepts to product development, you can create profitable products faster. However, before you do, you will have to learn that sometimes slower is faster.

The Lean Product Development Process

  • Return on Investment Analysis & Stage-gate
  • Marketing Specification & Stage-gate
  • Concept Design & Stage-gate
  • Design Product or Service & Stage-gate
  • Pilot Manufacturing Run (if applicable) & Stage-gate
  • Field Test & Stage-gate
  • Launch Marketing Plan
  • Review Product Profitability versus Plan

Each stage of the Lean Product Development Process will be explained. However, more important than each individual stage is the concept of the “stage-gate”. A stage-gate is a place in the process that, after everyone signs-off, they cannot go backwards. Initially, stage-gates can seem to slow down the process. Until the department or team downstream of a stage-gate accepts the input to their stage of the process the effort cannot go forward. However, this will actually make the process faster, and much more effective, because it creates accountability and eliminates the possibility of getting a product that is too expensive, slow, large, etc. from getting to the market. Products are designed to sell profitably and launch when scheduled.

The other importance of the stage-gate process is that as product development progresses, it gets more expensive. Final design requires more time and resources than concept design. Pilot manufacturing is a significant expenditure due to tooling requirements. Finally, the launch of the product is most expensive of all stages, as the company will be spending money to market the product and will most likely begin marketing expenditures.

Return on Investment Analysis

This stage is the primary responsibility of the Marketing Team. They will:

  • Understand the need
  • Create the concept
  • Develop sales forecast
  • Identify cost targets
  • Work with Research and/or Development/Engineering to define the product development budget and timeline
  • Present financial return on investment for approval

This initial stage creates the financial case for developing this product or service. By creating the sales forecast based on initial cost targets, the Marketing Team takes responsibility for the final sales and profits that result from this product development effort. Because Research and/or Development/Engineering is involved they get early buy-in and communication on the concept. Once this stage-gate is passed the company agrees to move forward with the concept design. Management can kill the effort at this point or give its approval to move forward to concept design.

Marketing Specification

The Marketing Product Development Representative will define their requirements for the product or service. This may include:

  • Critical dates
  • Development budget
  • Target market and application
  • Performance specs
  • Functional requirements
  • Appearance/Size specs
  • Unit-Sales expectations
  • Regulatory standards
  • Competitors’ products
  • Life expectancy
  • Determine field-test sites

When the Marketing Rep documents this list of requirements they will meet with Research or Development/Engineering, who will sign-off and accept this as their concept design input. This is another stage-gate. Now the project is in the hands of the Research or Development/Engineering Team to create their conceptual design.

Concept Design

If this product involves innovative technology, then typically the Research team will be responsible for concept design. Research would be responsible for handing the Development/Engineering team a “developable” concept design. If the product is an extension of existing technology, then typically it moves right to the Development/Engineering team. Research or Development/Engineering will brainstorm possible designs and create mock-ups of this design if needed and budgeted. They may work with purchasing to gather preliminary vendor costs. The output of this stage is a conceptual design (which can be a drawing, 3-D model, service or software demo), estimated cost, design timeline and test data if appropriate.

At this stage-gate Marketing, Development/Engineering and Operations must sign-off on the conceptual design. If they reject it, then the team responsible for concept design has to refine the concept. This may involve changing the appearance, cost, functionality, etc.

Design Product

This stage is the responsibility of Development/Engineering with input from Purchasing and Operations. This stage includes:

  • Create detailed design budget and timeline
  • Finalize design
  • Run failure mode & effects analysis (FMEA)
  • Create detailed demo, model and bill of material
  • Create work breakdown structure
  • Choose components and select vendors (working with purchasing)
  • Produce prototype
  • Document test requirements
  • Design packaging
  • Create initial customer manuals
  • Determine final cost

When this is complete and the prototype is produced or procured there will be a stage-gate approval meeting with Sales and Marketing. They must approval the cost, appearance and functionality.

Pilot Manufacturing Run (If the product is a hard-good)

Pilot manufacturing is a collaborative effort between Development/Engineering, Purchasing and Manufacturing. While design-for-manufacturability may have been used during final design, this stage represents the transfer from Development/Engineering to Manufacturing. Vendors and Manufacturing are tooling up to produce parts. When the pilot manufacturing stage is complete Manufacturing is expected to have completed all production and testing documentation (standard operating procedures).

Field Test

  • Install product at customer field test sites
  • Run product
  • Evaluate results with Marketing
  • Make changes if necessary
  • Finalize customer manuals

Pilot run production prototypes are sent to field-test sites. The purpose of this test is find problems. These problems may include quality issues, durability, functionality, installation, etc. Hopefully none are found, but if we were 100% confident of this, then field-testing wouldn’t be needed. Some organizations have separate Field-Test groups. Often field testing may be done by Technical Service teams or can be managed by Development/Engineering.

Marketing Launch

  • Review launch schedule
  • Distribute promotional material
  • Distribute training material if applicable
  • Train Sales Force
  • Train Customer Service
  • Review initial customer service data
  • Provide feedback to Development/Engineering and Operations

Once field testing is complete and the design in locked down, the company is ready to start selling. Selling must be preceded by training for sales reps, customer service and customers. The selling process must be planned like all other steps in the product development process.

Evaluate Results

The last step of the product development process is to evaluate results. This is often-overlooked. Many companies accept the results they are getting. The most successful companies evaluate the actual results to their original budget. If sales are under budget then they evaluate why and make adjustments to the next product development effort. If sales are over budget then this too is evaluated to understand what led to this success.

The Role of Documentation in Product Development

  • Task
  • Primary Department Responsible
  • Specific Person Responsible
  • Measure of Success Description
  • Documentation of Success

It is important to document the product development process. While we don’t want to create un-necessary paper or electronic files, there needs to be proof that each step of the process is done successfully and a clear definition of what success means. The actual product development process is usually a minimum of 100 discreet steps. More complex products are far more detailed. Therefore, we need to define what documentation clearly shows that each step was successfully completed. The bullet points above provide the minimum information we expect to see on the Product Development Checklist.

Do Hens Products Add Value to a Hens Event?

Firstly what are hens products? Hens products tend to be novelty like items used to create atmosphere and add to the decoration and theme of a hens event, which is typically held in honor of the bride a week or so before her big day. Hens Products can be anything you like, naughty or nice, unique or something you have seen before. They should be something that makes the event memorable for not only the bride but all those in attendance. After all everyone wants a hens party to remember so make sure you chose products that make a statement and draw attention.

There are a lot of hens products out on the market at the moment, not all are nasty, there are some very clever, funny products which will definitely add value to any party whether it’s a hens or other themed event.

There are many events celebrated throughout the year including birthdays, new arrivals, anniversaries, engagements etc so to differentiate and promote exactly what you are celebrating you need a theme and products to create this point of difference. Just as birthdays tend to have balloons and cakes, hens events can have their own novelties to make attractive and stand out.

Hens products tend to usually set the trend for the night/ function and lets everyone know what’s in store for them.

Today traditional parties can consist of a night out on the town with plenty to drink, entertainment including strippers, dinner at restaurants themed with fun hens products and the bride ‘guest of honour’ decked out in some elaborate gear. Bridesmaids organise dares for the bride to accomplish on the night and it becomes known to the public the bride is to wed in coming weeks.

For those of you who are not so wild there are many options awaiting including being pampered at a day spa, masseurs and beauticians can come to your home,intimate cocktail party, high tea, cooking classes but still at all these events the venues are themed with novelties and decorations to remind them of what everyone is celebrating.

You can clearly see now that Hens Products definitely add value to any hens event, Bridal Shower or Bachelorette Party. Now all you have to decide is which products to purchase but it can be guaranteed whatever you chose it will make the hens night a blast and create memories which will last a life time.

How to Buy Beauty Products and Perfumes – Some Helpful Tips

While recession has impacted the buying habits of all consumers, we do not need a recession to remind us that buying smart is the only way to get the best value for your dollar. Buying smart means two things—a reasonable margin over cost is allowed to be included in the retail price and the product lives up to its claims. With respect to beauty products, unfortunately, the industry is teeming with products that are pushed with hype and nothing else. So here is how to go about buying smart.

Let us first understand the beauty products segments. There are two major ones. Clinical beauty products and Fashion beauty products. The clinical segments consists of things like skin toners, eye conditioners, cleansing products and moisturizers. Fashion products mostly consist of perfumes and fragrances, but may also include aromatherapy products. Note that I have not included the third kind, “Muscle manipulators” as beauty products. These include botox and other invasive and non-invasive, sometimes surgical products. Simple advice–stay away from these. They are fatal to your long term looks.

1.First off, be very careful of overapplying make-up. Make-up products contains acids and chemical restoratives which may have negative impact on your body and hormone’s natural rejuvenating process. A quick tip–if you look pasty and 100% wrinkle free (as do many TV anchors and actors and actresses) you are harming your skin permanently. Make-up should be a light sheen on your skin. There is another way to deal with wrinkles, but caking make-up over wrinkles, as any dermatologist will tell you, causes long term skin damage and may even lead to other diseases like immno-deficient trends and allergy build-up. Similar, use moisturizers very sparingly–no matter how they are hyped, they contain reagents that take away skin’s natural moisture making ability.

2. Do not be fooled by hype. Study the manufacturer. Study its history, its recalls, its problems and if a public company, study its financials to see how much it spends on research and development, not on marketing. The money it spends on marketing is a negative investment to you as a consumer. Investment in research on the other hand shows you that they are forward thinkers. If you do not get the information from the financials, ask the management.

3. Buy your clinical product from one who specializes in skin toners, cleaners and other conditioners. Never buy fashion products from the same manufacturer. You will find that making perfume is an age old process and companies that dabble into it are not necessarily leaders. While both are chemical processes, perfume making is an art, not science. That is why the perfume brands that have been around for 50+ years generally do not peddle skin toners. If they do, stay away. There are at least 10 excellent companies in each category so you have plenty of choice.

4. The best clinical products are ones without added fragrance. The best fashion products, specially perfumes, are subtle, not overpowering. Also, remember evening scents are different from morning scents. Finally, both type of products, definitely clinical products should be bought after consulting with a good professional, because they can determine your natural skin tones and underlay textures and advise you accordingly.

5. Remember what I said about hype? Forget overhyped, branded products. You are mostly paying for marketing dollars. Instead, compare the ingredients–ignore the ones that have fancy names like “so and so’s formula” or “musk hair extract”. It means nothing because FDA will not allow an untested product to be prominently mixed, so you may be getting a negligible amount of that fancy ingredient. You will find that cheaper or store brands have the same chemical or natural ingredients as the fancily priced ones. The only exception I make is in perfumes. Certain perfumes have been around for a long time and never go out of fashion. On the other hands, the upstarts, peddled by actresses and actors, are usually cheap smelling, overpowering and have very little elegance and subtlety. Remember, you are wearing a perfume strictly for others. The trick is this–if you can “smell” your own perfume, you have either put too much or the perfume is cheap–and I don’t mean price wise. The best perfume is the one that subtly “hangs” in the air. You should either not smell a good perfume, or smell it very faintly–almost as if you are not sure you smelled it.

Good luck.