Archive → July, 2010
Where’s the Strategy in New Product Execution?
New Product Execution – the ability to identify a new product, scope it, build a business case, decide to proceed, finalize requirements, plan, resource and deliver a new product. Execution scope covers the entire chain of activities from initial concept to production revenue and success cannot be claimed unless the entire sequence is a triumph, particularly the revenue objectives. My observation of execution for new products over the years has generated the following four certainties:
- The business view of new product execution is much more negative than the engineering teams. This is primarily due to a difference in measurement criteria; the business view is the correct one because it’s tied to money.
- There are too many new products that end up failing miserably on meeting business case revenue objectives. Valuable time, resources and money are routinely wasted.
- The ability to execute on new products will likely be the same in 12 months as it is today, probably even 24 months out. This means that timing of concept to revenue will remain flat.
- Improving new product execution is always under funded and under resourced but never under mandated.
Most businesses have utilized a structured project management technique for over 15 years, an approach that is comfortable because of its well-defined activity sequencing. The majority will stay within a fairly tight set of implementation constraints because things might get worse if it is fiddled with too much. A formalized plan of attack such as this provides an excellent framework for turning the crank on an established project management methodology such as PMBOK or PRINCE2. The problem is that this purely tactical approach is just not delivering the level of success required by the businesses; there must also be execution improvement strategies.
The semiconductor industry tends to focus on the technical strategy for new products while taking a pure tactical approach to handling the execution. Businesses are often forced to decide, “Should we spend money on technical product advancements or improving the new product execution strategy?” The execution strategy always ends up last in any kind of power struggle for money and resources. Since strategy generally equates to spending, money is yet another force at work that keeps a pure tactical project approach in the mainstream.
The semiconductor industry is stuck in a place that demands improvement while the activity and funding level afforded this cause delivers nothing but mediocre results. If attention is to be paid to this dilemma, the costs associated with dysfunctional approaches to carrying out new product development must be identified and brought into full view. Delayed revenue, rework costs, future new product delays, poor ROI, inefficient requirements closure and tool/flow inefficiencies are a few examples of items to utilize in building a cost case. Remember, if there isn’t a notable perceived cost, there will be an assumption that it’s not broken.
Below is my list of execution objectives and challenges that are on most organizations wish lists, and they have been there for many, many years. There simply can’t be an acceptable level of execution while well over 50%, and in some organizations up to 100% of these disruptors are allowed to continue unchecked. Fixing these deficiencies will require a strategic approach to new product delivery; it will require change.
Strategies for Ideal Execution
Plain and simple – new product execution will not get better without a strategic approach to understand what’s broken and fixing it. It will take money, people and a commitment to address, something that has been lacking for a very long time. Strategic execution should be the new mantra for businesses that need to forge into the next generation of embedded system development. Success will not solely depend on new EDA approaches such as EDA360; it must also include next generation concepts, tools and methodologies for managing product development. It’s time to put an end to terminal sameness in new product execution by delivering the strategies so solve the well-known issues that hold teams back every day!