The One Best Way (Part 5): Gates

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Are gates the best way to manage product development?

Establishing “gates” through which projects must pass if they are to be pursued is a common practice in product development organizations. I actually like “gating”, for it provides structure as well as an intellectual framework around the investment of scarce developmental resources. Naturally there are consultants with magical systems of gating. Google it.

One of my favorite gates was shown to me by my father.

Back in the 1970’s when I was in college, an acquaintance suggested that someone ought to put in-store product advertisements in shopping carts. The moment I heard the idea I was ready to run with it. I called my father for advice – for which he gave me these two chestnuts:

1. Don’t worry that it was not my idea to begin with. Most ideas die on the vine, and whoever commercializes an idea has the chance to succeed. He added (not without a trace of sarcasm) that in a couple of days I would believe the idea was mine anyway.

2. Was I the logical entity to run with this? There was nothing patentable or protectable about the idea. Any supermarket, ad agency, shopping cart manufacturer, etc. would eat me alive once the idea was put into practice.

Thirty years later, during a conversation with the VP of R&D at a major U.S. company, he stated that his program was based on gating, and the most important gate was whether his firm was the best positioned to pursue a particular development. Brilliant man.

The One Best Way (Part 4): Creativity

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Looking closer at whether there is one best way to solve a particular problem: let’s look at creativity and bringing it into your company. Can it be taught? Probably to some degree. How to invent, be more creative, or develop new products has always been part art and part science.

George Bernard Shaw wrote in Man and Superman — “Bob: I’m so discouraged. My writing teacher told me my novel is hopeless. Jane: Don’t listen to her, Bob. Remember: those who can, do; those who can’t, teach.”

While there are individuals and firms that claim to teach creativity, I suspect that if anyone really had the key, it would have been more remunerative to make inventions, than to teach others how to do it.

This is evident in the investment business. Investment advisors are everywhere, but few have their own success to show for it. The successful investor is generally unable or unwilling to part with his knowledge unless highly rewarded.

This is relevant when it comes to hiring consultants. While it is desirable to keep some tasks in-house, if you do not have creative capacity on staff, contracting out – bringing the creativity in – provides a cost-effective solution.

Going back to the original question: Is there one best way to add creativity to your company equation? No. It depends entirely on the industry, the company, the culture, the age, education, experience of the staff and the size. The charge led by “Here is how they do it at Intel” can be a disaster for the wrong company.

The One Best Way: Open Innovation (Part 3)

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Is there “one best way” to do innovation?

On the surface, Open Innovation is pretty appealing.

There is a huge amount of information “out there” that you can use to deal with a problem quickly and efficiently.

www.openinnovation.net presents a good overview of the philosophy behind this movement.

But before charging in — some caution is in order:

  • In their desire to sell their goods, small companies may share too much too fast. Remember that assembling several off-the-shelf components into something unique is at the heart of invention. Many companies operate in a commoditized world — even so, don’t be too quick to assume away the uniqueness of your contribution.
  • Is your potential customer being open about their intentions? Open innovation searches are a great way to compile data to write a strong patent application around your technology.

Take a look at www.ninesigma.com/. Interesting stuff. But if you review a list of their RFP’s, you’ll see that many of their clients do not disclose their identities. Should you share information with an unknown client? Definitely something worth thinking about.

Hope Is Not a Strategy – Odds of Success (Part 2)

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Recently I corresponded with a reader who was concerned about the implied negativity around the “odds” of success described in these posts.

I have done quite a bit of research on the odds around product development and am comfortable with my numbers. It is not much different than saying that 1 out of 5 small business startups succeed. I have actually been pushed toward these terrible odds by the senior people I have worked with in product development.

My view is to embrace the numbers. Success comes from dealing well with failure. Run through the things that don’t work. Kill dumb ideas. If you have only one or two new products, it is really hard to prioritize and pick between the winners and failures. View it from a portfolio perspective — an investor who buys one stock is gambling.

Or you could choose to look at it another way: how does one actually calculate the success ratio? What is the numerator, and what is the denominator? A researcher working at the bench may see lots of failures. The chairman, who validates the decision to launch a fully refined product, sees completely different ratios.

It is a lot like sales. When I was young and naive, if someone called and asked about my product, I figured that was about as good as a sale. Now when I have a new lead, it does not even register until there has been a great deal of qualification. As we manage a sales effort, we recognize that it takes multiple leads to result in a sale, and we organize accordingly. We need to recognize that similar metrics apply to new product development.

We Have Met The Enemy and He is Us (Walt Kelly)

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Many organizations do not recognize that they have an innovation problem.

Last year I attended an industry-sponsored event that included a dinner with “thought leaders” on the subject of innovation.

The event started predictably enough with statements such as, “our only problem is finding enough good people”, or “we have so many ideas, the problem is sorting through them.”

After several bottles of wine, the comments became more candid:

  • “Our management only allows us to innovate by modifying packaging, color or size of our existing product line.”
  • “How do we even start?”
  • “Where do you find decent ideas?”
  • “There are no good new product people anymore.”

One confided – “We lost a major opportunity simply because we could not figure out how to get a sample roll through the SAP system.”

There is a revolution taking place in innovation and product development, but many companies are wedded to the old way of doing things. Like the dinosaur, they will face extinction unless they learn how to innovate quicker at lower costs and shorter time to market.