Prod Dev Intro s

8/8/2019 Prod Dev Intro s

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New Product Development Process

ProductIdea

Product

RealizationProcess

MarketOpportunity

TechnologyOpportunity

RealProduct

Front end Product Realization


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Views of Successful ProductRealization

q Heroic AgeCreative geniuses,Driven by their understanding of project needs,

shielded from management presentations, etc,Put in long days and nights,And create break though products


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Charles Ginsberg et al with the Ampex VRX-1000


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List of Famous FailuresFamous System Failures

Name Year Reference Wa

dreq

Hubble Space Telescope 1990Chapman, et al.

(1992)

Ariane 5 missile 1996 Kunzig (1997)

SuperConducting

SuperCollider1995 Moody, et al. (1997)

GE rotary compressor

refrigerator

1986Chapman, et al.

(1992)Motorola, Iridium 1999

IBM PCjr 1983Chapman, et al.

(1992)

Space Shuttle Challenger 1986Feynman, Tufte(A. T. Bayhill)


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Views of Successful ProductRealization

q Heroic AgeCreative geniuses,long days and nights, etcbreak though products

q

q Repeatable Disciplined Product RealizationTalented people,Following well understood processesetcbreak though products, time after time


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LightSpeedTM

CT Scanner

Biggest breakthrough in CT in a decade, Gary Glazer, Stanford

Biggest breakthrough in CT in a decade, Gary Glazer, Stanford

GEs First DFSS System (98):Full Use of Six Sigma/DFSS Tools

Key customer CTQs identifiedImage qualitySpeedSoftware reliabilityPatient comfort

Disciplined systems approach: 90 systemCTQs33 Six Sigma (DMAIC) or DFSS projectsScorecard-drivenPart CTQs verified before systems integration

Leading-Edge TechnologyWorlds first 16-row CT detectorMulti-slice data acquisition64-bit RISC computer architectureLong-life PerformixTM tube

ResultsBetter image quality

Earlier, more reliable diagnosesNew applications: vascular imaging,

pulmonary embolism, multi-phase liverstudies, ...

Much faster scanning:Head: from 1 min to 19 sec (9 million/ yr)Chest/abdomen: from 3 min to 17 sec (4

million/yr)Clinical productivity up 50%10x improvement in software reliabilityPatient comfort improved - shorter exam timeDevelopment time shortened by 2 years

High market share; significant margin increase

Head

Abdomen

GE Medical Systems


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Disciplined Product Realization

q toll-gate processes q

q toolsq

q

q

q

q

q

q

q

q

q

q

q Engineering/Business Decisions with everyone on the samepage

Examples

Multigeneration Product Planning

Customer Requirements Definition

Technical Risk Management

Management and Control of Defects

Supplier Management

Reliability Engineering


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Toll-Gate Process Example*

ProductPlan

Analysis

Phase1

Phase2

VisualFreeze= Req.Freeze

Test,Debu

g

CodeFreeze

Require-mentsagreement

Productrelease

Gate 2: Requirements nailed

Gate 3: All functions working

Gate 4: Bugs and performance acceptable

* After Steve Maguire, Microsoft

Gate 1

Gate 2

Gate 3Gate 4


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Toll Gate and Concurrent Engineeringq Concurrent Engineering is an abstraction of

effective interaction of cross functional teams

Pilot production/testing Final process design

Preliminary processdesign

Concept development

Product design

RequirementsDefinition

Product Launch /Production Scale-up Toll gate is a prescription for

developing products .


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Concurrent Engineering in a Toll-GateProcess

q Modification of cast metal refrigerator

handle

Business

Case

Designand

ProcessConfirma

tion

DetailedProduct

andProcess

Design

InitialProducti

on

FullProducti

on

1. ProgramContract

2. TechnicalSignoff, Orderlong lead items

Checklist for tollgate 1:Program DefinitionProgram PlanProgram ResourcesProduction costTechnical riskReturn on

Investment

When should we confirmthat are no patentinterferences?

When should we reviewsafety (sharp edges orpinching little fingers)?


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Robust Design and Appliances

q All manufacturers take robust design concepts seriously

q But some do better than others, with some consistency

0 10 20 30 40

Whirlpool

Kenmore

KitchenAid

GE

GE Monogram

Amana

SubZero

Figidaire

Magtag

repairs (%)

Repair history of Sideby Side Refrigeratorswith Icemakers 1999-2003

(From ConsumerReports)


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Business/Engineering Decisions - Quiz

Rarely enough resources to hit all the targets

performance of the product (or service)cost of development and production

time for development before the market window starts toclose

QuizHow do technical and business people in a world class

competitive company respond when constraints close in?

1.Report to upper management that everything is fine, andstart circulating your resume

2.If the first prototype works, ship it and hope that the

production units will all work too3.Throw in the towel

4.Turn the experience into a Dilbert cartoon

5.Manage the conflicting requirements as part of a data-driven, disciplined process with engineers and managerson the same page


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Process Discipline and Bureaucracy

q All disciplined processes entail some bureaucracy

q

q Some processes are clearly valuable, some are a waste oftime, and some can go either way


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The Next Quality Initiative


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Effective Product DevelopmentProcess

q Develops great products that

work in real use environments

appeal to customers (beyond justworking)

have low cost of production anddelivery

q Develops products fast

meet market windows, recoverinvestment

q Develop products efficiently

Low development cost

Business Success


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Product Planning Decision

q Product PlanningLots of great ideas

Fund only those that will contribute most to businesssuccess

ProductIdea

ProductRealization

Process

MarketOpportunity

TechnologyOpportunity

RealProduct

Product Planning


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Specific Types of Product PlanningDecision Processes

q Quantitative return on investment (ROI)calculations based on discounted cash flowprojections

q

Qualitative view of factors based on data +opinions

q Overriding strategic consideration


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Return on Investment (ROI)

ROI = return on investmentFor equity funding, this is thesame as Discounted Cash-flowRate of Return

Higher for a, than for b,since a returns cash sooner

Payback time is sometimes usedas a surrogate for ROI

Higher ROI usually meansshorter payback

a

b

Paybacktime for a

Paybacktime for b

Cashflow

time

F di D i i P


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Funding Decision Process

q Always more items that can be funded

q

How do we decide?q Whether informal or formal, there is a

decision matrix like this at work:

A B C AxBxC cum$ (M)

Project a

Project b

Project c

A = return on investment (ROI) if successfulB = discount factor because of risk that we will not be so successfulC = hard to quantify factors, like strategic fit

35%

45%

30%

.8

.6

.7

1.2

1

1.2

34%

27%

25%

10

23

35

Example for$25M programbudget

Below the line


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ROI Based Decision Making

Documents

Prod Dev Intro s