Increasing The Odds Of A Successful Launch
Silicon Valley is filled with launches. We are a hotbed of new ways of thinking, new forms of work, new technologies and new products. Entrepreneurs flock to this area to take advantage of a diverse, intellectual and risk-taking labor pool. The Valley has start-up think tanks and incubators around every corner. If you want to launch something, bring your ideas and sweat equity to the Bay Area. But, when you get here don’t assume you have all it takes with just a mighty good idea.
Launching is not equal to success. One out of every ten products is successful, and even, that success is defined quite narrowly. How can a company increase its odds of not only launching a product that makes money but also ramping a product that grows rapidly in revenue and profitability? Much of the success of course is due to the product idea itself. That, in turn has everything to do with the brilliance of the invention and the knowledge of the market.
But marketing and innovation are like a two-legged stool. The third leg that is often shorter than the others is execution. The saying that “God is in the details” holds true when it comes to getting a new product out of the door in a state that will allow for a high quality ramp. Let’s get practical about what this means in a product development setting.
1. Start with the end in mind — When a product development effort begins, it is often centered around getting two or three prototypes to work. That, of course, is necessary but not sufficient. Shortly after a concept is built the team should be considering the implications of scale. Handy tickler questions are:
- What is the volume expectation? Tooling decisions should be made early. Tooling is typically on the critical path. Designing for plastic/metal molding or sheet metal fabrication processes early will save time and money.
- What does this product need to cost in order to get to the volumes anticipated? Targeting cost at an early stage will aim you at the right supply chain, material and packaging choices.
- How will this product be used? And therefore what design margin should be used to be certain that quality expectations are met? This drives design verification test (DVT) and highly accelerated life test (HALT) decisions and likely drives material choices.
- Given the volume and cost requirements, how will this product be built? How quickly do cost targets need to be met? This drives supplier and tooling decisions.
- Where is the market? Is this a product for a global market or will the customers be concentrated locally? Could this change over time? This drives supplier and distribution channel decisions.
2. Engage a cross-functional team — Bring in an expert in manufacturing processes to work alongside the development team. While a great product is the foundation for success, the house is built with cross-functional cooperation. Bringing a quality product to the customer at the right price point with predictability takes a team. Putting the “full monty” in place early sounds expensive but it doesn’t have to be.
A very small team of experienced operations leaders can connect you with an array of outside services that will offer early fabrication, tooling, design for manufacturing and test (DFM/DFT), logistics and packaging expertise. These leaders should be practical, hands on people who will engage in the day-to-day problem solving. At the same time, the right people will be well-connected and will know what they don’t know — they will find the experts using contract manufacturers or consultants. Paying for services amortized into part cost or paying for help by the hour will keep costs down while getting you the help you need.
3. Build fast and frequently — The idea of rapid prototyping has been around for a while, but it isn’t used regularly in new product ramps often enough. Especially with additive manufacturing processes, field programmable gate arrays (FPGAs) and quick-turn prototype houses available, it is possible to build a few to try out a concept prior to building many. Once you commit to a tool, whether it is a plastic mold, sheet metal punches or application-specific integrated circuit (ASIC) design, you are locking in cost, and tweaking is expensive.
A common mistake with the fast turn processes is to do the work independently of the final manufacturing process. Then the transition to the volume process is a major undertaking. Work with the manufacturing partners you have chosen to use rapid turn processes that best match what the final process will be.
4. Put together a diverse team — While this isn’t specifically related to execution, it is related to performance. Often start-up companies are initially staffed with people who know each other well because they have worked together successfully in the past. Since we feel most comfortable with people like ourselves, teams look homogeneous without some conscious intervention. A recent study showed that start-up companies with at least one women executive made more successful exits and for every 10 percent increase in women executive and director employment, the business’s probability of success increased by six and three percent, respectively.
Diversity is more than a gender thing. The highest functioning teams have different types of people. Mix up race, ethnicity, gender, age, thinking styles and life experiences. If this team is managed well, the performance will be outstanding. Your output will be stronger and your risks will be lower.
5. Use checkpoints meetings… seriously — When asked, most development managers will insist their company uses a new product introduction checkpoint process. This is a process that is defined upfront and usually consists of at least five phases: concept, proto, pilot, ramp and end of life. At the end of the phases are checkpoints that serve a purpose of bringing that diverse, cross-functional team together to talk quantitatively and qualitatively about the readiness to move to the next phase. These reviews serve as a kick-in-th- rear for those who are behind. They keep the team accountable and they show the leaders where there are vulnerabilities.
Taking these meetings seriously is one way to keep the end in mind and to get full cross-functional attention. These checkpoints are also a serious opportunity to stop the presses. Blindly moving forward when key elements are not ready will cost money at the least and will derail a company at the extreme. Ideally, an honest evaluation — complete with a review of the warts — will allow for a course correction while the project continues. Adjustment is less expensive than redo later and much less expensive than a launch that fizzles due to quality or availability issues.
These five points, if followed, will increase your odds of launching a successful product. None of them are hugely taxing but surprisingly, most companies do not comply with all of these points. There is a resistance, especially in the start-up space, to overlaying processes. Process without purpose is a weight. Process that serves as a support to execution will be flexible and light weight and will save time, reduce risk and help a company launch a winning product.
“Excellence is never an accident. It is always the result of high intention, sincere effort, and intelligent execution; it represents the wise choice of many alternatives – choice, not chance, determines your destiny.”
Marcy Alstott is an Operations and Supply Chain executive with diverse product and technology expertise, multinational management credentials and extensive transformation know-how. She most recently was the VP of Operations for the LaserJet Business at Hewlett Packard. Learn more about OpsTrack Consulting at www.opstrakconsulting.com.