Product Planning - Stephan Sorger

ProductPlanning

New Product Development © Stephan Sorger 2010: www.stephansorger.com; Product Planning 3.1

Disclaimer:• All images such as logos, photos, etc. used in this presentation are the property of their respective copyright owners and are used here for educational purposes only• Some material adapted from: Ulrich & Eppinger, “Product Design and Development,” 4th edition

http://www.stephansorger.com/

Product Planning: Symbian Cell Phone Platform


Source: http://mobilecallerid.blogspot.com/2009/03/symbian-platform-release-plan.html

Term Description

Product Plan Identify product portfolio & development schedule

Platform Plan Example of product plan: Build upon common platform

Symbian Cell phone operating system (OS) (compete with Apple & RIM)

Nokia E71xThin SmartphoneRuns Symbian OSBased on Symbian^2

2010 & 2011 versions of productbuild off 2009 Symbian Platform- Typical platform strategy- Great for dynamic markets- New version every 6 months


Product Planning

What products should we develop?

When should we release products?

What mix of products should we make?

What market segments should we target?

What new technologies go into the product?

What are our manufacturing goals?

What are our financial targets?

What budget and schedule should we target?

ProductPlan



Portfolio Plan: Xerox Example (from Eppinger)

Xerox Document Centre 265 Case Study: www.memagazine.org/backissues/membersonly/october97/features/core/core.html

New Platforms

Derivatives

Improvements

Totally New

1996 2000199919981997

Astro

3933926010595

L-Net

H-Net

Lakes

Hodaka

Portfolio Plan/ Scheduleaka Product Roadmap



Types of Product Development Projects

Project Type Description

New Platforms Create new family of products based on new platformPlatform shared by all products in familyLeverage development cost across multiple productsExample: Xerox Lakes project

Derivatives Extend existing product platformTailor product to address certain market segmentsSimilar to a brand extensionExample: Network-ready Hodaka (H-Net)

Improvements Incremental improvements to keep product currentExample: Minor change to address complaints

Totally New Completely redesigned productNew technology and/or new production techniquesPossibly to address new marketExample: First digital copier



Product Planning Process: 5 Steps


IdentifyOpportunities

Evaluate andPrioritizeProjects

AllocateResourcesand ScheduleTiming

CompletePre-ProjectPlanning

ProductDevelopmentProcess

Portfolioof Projects

MissionStatements

ProductPlan

PotentialProjects

1 5432


Step 1: Identify Opportunities

Sources for Ideas Description

Super-Users Periodically interview visionary usersKey: Does product give them a competitive advantage?

Bug List Record enhancement requestsKey: Establish priority system

Sales Force Gather feedback from salesforceKey: Focus on changes benefiting multiple customers

Competitors Benchmark competitive offeringsKey: What features are common? Which are unique?

Trends Conduct PEST analysis to discover trendsKey: Political, Economic, Social, Technological

Technological Evaluate new technologies for use in productKey: Does technology give a competitive advantage?


Identify Ideas for New Product


Step 2: Evaluate & Prioritize Projects: 1 of 6

Topic Description

Technology Conduct R&D to bring new technologies to marketExample: 3M, with many tech breakthroughs

Cost Focus on low-cost manufacturingExample: PNY, maker of generic memory devices

Customer Focus Emphasize unique customer needsExample: Dell, configuring PC to individual needs

Imitative Quickly launch products that imitate market leadersExample: Malt-O-Meal: Puffed Rice, Puffed Wheat


Competitive Strategy: Approach to Market

3M Post It PNY Flash DriveMalt-O-MealPuffed Wheat

Dell PC




Market Segmentation: Product Segment Map

2000199919981997

Personal

Department

Workgroup

Market Segments

Lakes Project

L1 L2 L3 L4

Lakes Extensions

L5 L6 L7

C(D) 1

Hodaka Project

H1 H2 H3

C(P) 1

H4 H5

C(W) 1 C(W) 2 C(W) 3

Potential Competitor

Existing Competitor

Xerox Product




Technological Trajectory: When to Adopt Technology?

ProductPerformance

TimeToday

Analog Light LensTechnology

Digital ImagingTechnology

CCD Chip in Camera




Product Platform Planning: Fosters Derivative Products

DerivativeProductDevelopment

Time

R&D

Platform ProductDevelopment

Platform A Platform B

Project

Release


Criterion Description

Market Size Units/ year x Average price

Market Growth Percent growth per year

Competition Intensity: Number of competitors and strength

Expertise Depth of knowledge of market

Technology Depth of knowledge of technology

Product Fit Alignment with other products

Technology Fit Alignment with core technologies

IP Development Potential for patents or other barriers to competition


Evaluating Fundamentally New Product Opportunities


Market size & growthare key factors



Balancing the Portfolio: Product-Process Change Matrix


New CoreProcess

No ProcessChange

IncrementalChange

SingleDepartment

NextGeneration

New CoreProcess

MinorEnhancement

Product FamilyAddition

Next GenerationProduct

New CoreProduct

ProcessProduct

BreakthroughDevelopmentProjects

PlatformDevelopmentProjects

DerivativeProductDevelopment

CurrentProductSupport

Size = Cost of Development

Diversification Goal: Mix of DifferentTypes of Projects


Topic Description

Resources Too many projects, competing for too few resources

Problems Low resources low productivity, late to market

Aggregate Planning Allocate resources considering entire portfolioLimit projects to those achievable within resource limitAvoid exceeding 100% of critical personnel resourcesEliminate low priority projects

Microsoft Project Use scheduling tool to calculate total resourcesCan not exceed 100% utilization rate


Resource Allocation

Step 3: Allocate Resources and Plan Timing: 1 of 2

Microsoft Projectcalculates totalresources requiredacross multiple projects


Factor Description

Product Introductions Sequence projects to avoid being late to marketTrade-off: Do not compromise quality to make schedule

Tech. Readiness Ensure underlying technology is ready before launchTrade-off: Non-robust tech. can cause support issues

Market Readiness Consider timing of launch vs. product life cycle (PLC) Early in PLC: Can often charge higher prices Late in PLC: Many competitors, charge market rateTrade-off: Frequency of new releases Too slow: Product can lag behind competitors Too fast: Risk frustrating customers

Competition New products can trigger competitive reactions


Factors to consider for sequencing projects (Pipeline)

Step 3: Allocate Resources and Plan Timing: 2 of 2

Product Life Cycle- Familiar S-Curve


Element Description

Brief Description Identifies basic function of productExample: Networkable, digital multi-function machine

Benefit Proposition States value proposition of product for customerExample: Multiple document functions in one machine

Key Business Goals Objectives for time, cost, quality, profit, otherExample: Serve as platform for future offerings

Target Market(s) Identify primary and secondary markets for productExample: Office departments, Quick-print market

Assumptions State assumptions and constraints for projectExample: New platform, Digital imaging

Stakeholders List everyone affected by product’s success/ failureExample: Users, Manufacturing, Service, Retailers


Create Mission Statement to Summarize Project

Step 4: Complete Pre-Project Planning


Element Description

Opportunities Are staff members excited about the opportunities?

Competitive Strategy Does product make company more competitive?

Resources Are sufficient resources available?

Mission Statement Is core team excited with the mission statement?

Assumptions Are stated assumptions realistic?

Constraints Is development team over-constrained?

Improvements How could the process be improved?


Assess quality of the process and its results

Step 5: Evaluate Product Development Process

This stage representsthe “hand-off” from the product core team to thedevelopment team, so do a“sanity check” before proceeding


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Product Planning - Stephan Sorger