Product Development & Entrepreneurship
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1 Product Development & Entrepreneurship Development Processes and Organizations 1
2 Development Processes and Organizations Questions Is there a standard development process that will work for every company? What role do experts from different functional areas play in the development process? What milestones can be used to divide the process into phases? Should the organization be divided into groups corresponding to projects or functions? 2
3 A Generic Development Process The product development process is the sequence of steps or activities that an enterprise employs to conceive, design, and market a product. 3
4 Benefits A well-defined development process offers: Quality assurance Coordination Planning Management Improvement. 4
5 Generic Development Process Six phases 0. Planning 1. Concept development 2. System level design 3. Detail design 4. Testing and refining 5. Production ramp-up 5
6 MISSION STATEMENT 6
7 Lakes Project Mission Statement PRODUCT DESCRIPTION KEY BUSINESS GOALS PRIMARY MARKETS SECONDARY MARKETS Networkable, digital machine with copy, print, fax, and scan functions Support Xerox strategy of leadership in digital office equipment Serve as platform for all future B&W digital products and solutions Capture 50% of digital product sales in primary market Environmentally friendly First product introduction 4thQ 1997 Office departments, mid-volume (40-65 ppm, above 42,000 avg. copies/mo.) Quick-print market Small satellite operations 7 ASSUMPTIONS AND CONSTRAINTS STAKEHOLDERS New product platform Digital imaging technology Compatible with CentreWare software Input devices manufactured in Canada Output devices manufactured in Brazil Image processing engine manufactured in both USA and Europe Purchasers and Users Manufacturing Operations Service Operations Distributors and Resellers
8 Scope of Effort (product planning) Mission Statement Specifies direction to go but not the precise destination or a particular way to proceed. 8
9 Mission Statement May include: Brief (one-sentence) product description stating key customer benefits but not product concept Key business goals: Timing of new product introduction, market share targets, and desired financial performance. 9
10 Mission Statement (cont) Target market(s). There may be several. Identify primary and secondary markets. Assumptions constraining devoted effort: Although these may restrict generation of product concepts they can help to maintain a manageable product scope. 10
11 Mission Statement (cont) Stakeholders: All players who will be influenced by the product: end users sales force production department service department, etc. 11
12 Mission Statement for the course project Team composition (name, number) Product description Hypothetical key business goals Target market (primary and secundary) Assumptions Stakeholders one-page document 12
13 Concept Development Identify customer needs Establish target specification Analyze competing products Generate design concepts Select best design concept Refine specifications Economic analysis Project planning 13
14 Concept Development 14
15 Adapting the Generic Process Market pull Technology-push products Platform products Process intensive products Customized products High-risk products Quick-build products Complex systems 15
16 Market pull A firm begins product development with a market opportunity and then seeks out whatever technologies are required to satisfy the market need. Sporting goods, furniture, tools, 16
17 Technology push A firm begins with a new proprietary technology and looks for an appropriate market in which to apply this technology. Example:Teflon Product development starts with an additional phase to match a given technology with a market opportunity. Gore-Tex rainwear, 17
18 Platform Product A firm builds a product around a pre-existing technological subsystem (a technology platform ). Examples: Sony Walkman, Polaroid cameras, Apple Macintosh The initial phase is platform development. Consumer electronics, computers, printers, 18
19 Process-Intensive Product Production process places strict constraints on product properties. Snack foods, breakfast cereals, chemicals, semiconductors, paper, 19
20 Customized Product Customized products are a slight variation of standard configurations developed in response to a specific order by the customer. Switches, motors, batteries, containers, 20
21 High-risk Product High-risk products entail unusually large uncertainties related to technology or market It is therefore necessary to test earlier Pharmaceuticals, space systems, 21
22 Quick-build Product Detail design and testing phases are repeated a number of times until the product is completed. Software, cellular phones, 22
23 Complex systems Subsystems and components are developed by many teams working in parallel, followed by system integration and validation Jet engines, airplanes, automobiles, 23
24 24
25 25
26 Product Development Organizations Organizations are formed by establishing links among individuals Reporting relationships Financial arrangements Physical layout 26
27 Links within organizations Organizational links may be aligned with functions, projects or both A functional organization is organized by functions. A function is an area of responsibility calling for specialized education, training or experience. A project organization is organized by projects. Regardless of their functions, individuals apply their expertise to specific projects. 27
28 Functional and Project Organizations 28
29 Lightweight and Heavyweight Project Organizations 29
30 30
31 About assignment O1 for next week Consider the following aspects: Is the need experienced by someone other than you? (What is the potential market size?) (Will you face competition?) Will you have access (interviews) to customers? Will you have access (interviews) to end users? The need is fulfilled by a product (instead of a service)? Can you design a simple product to meet the need? Can you prototype this product? 32
32 Next Friday Invited lecturer Mariana Lino, Plataforma JAPortugal Junior Achievement Portugal 33
33 That s all folks! 34
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