Industrial companies are often perceived as lumbering giants that have difficulty responding to competitive pressures and capitalizing on market trends. Design cycles can last years—not just for developing new products but also for making upgrades to the existing portfolio.
Why are many industrial manufacturers so sluggish? In my experience, these companies have traditionally relied on a top-down, linear process that moves projects through design gates, also called stage gates. The approach is often slow and bureaucratic, and its mechanical nature can stifle creativity.
Fortunately, there’s a better way. Industrial companies can take a page from the fast-moving world of software design and adopt a sprint-and-scrum approach. This iterative process relies on short cycles involving rapid design evolution and revision. The sprint is a period of concentrated effort, such as engineering or coding a module, by individuals or small teams. At the end of each sprint, stakeholders from the key functions come together for the scrum, where they review progress and clarify goals for the next sprint. The intense nature helps bring the organization together toward a common goal, and avoids the tedium that can set in with a long stage-gate process.
Sprint-and-scrum has been used to develop many of the most complicated designs in human history. Take the Supermarine Spitfire, which was the main Royal Air Force fighter aircraft during World War II. At the outset of the war, the British realized that to be successful in the Atlantic theater, the aircraft would need significant improvements. Between 1936 and 1945, it changed engines, its loaded weight doubled, and its maximum speed increased by 90 miles per hour. The rapid evolution of the plane was possible only because of its iterative design and testing approach.
People may argue that the speed of efforts like the Spitfire development was enabled by enormous budgets and the sense of urgency imparted by war. And it’s a valid point: Over the last 1,000 years, large-scale warfare has proven itself time and again to be the single biggest catalyst for economic and technological innovation. But a closer look reveals that the decision to iterate these projects quickly and decisively—essentially, to sprint-and-scrum—was the biggest factor in their success.
Taking a sprint-and-scrum approach will bring most industrial manufacturers into uncharted waters. But I’ve seen firsthand how effectively the process can accelerate design and lead to better results. It reveals risks early on, it minimizes project management overhead, and most importantly, it energizes staff by showcasing achievements and fostering open communication.
In a recent example, a large automotive component manufacturer was facing significant pressure from foreign competitors importing less-expensive parts. In order to prepare for the next round of contract bids and ensure future profitability, senior leaders decided to undertake a series of rapid design-to-cost efforts on their major part categories.
They built a detailed cost model of each component to understand the main drivers of the cost structure that then informed a series of sprint-and-scrum efforts focused on major design changes. Further, the sprint-and-scrums identified several other structural and tactical improvement opportunities, such as relocation of assembly to Mexico, better spans of control within the manufacturing operations, and greater procurement effectiveness.
The company was able to implement a majority of the improvements—and it achieved a cost reduction of about 9 percent across the key component groups. This allowed the company to defend its existing contracts from competitors and, more importantly, provided a truly unique approach to design that was leveraged across the organization.
As their competitive pressures mount, other industrial companies should take note. It’s time to remove the shackles that the stage-gate process can place on design. Whether they are shooting for the moon or just looking for a way to quickly reset their product’s cost positioning, the sprint-and-scrum approach will help companies get there.
Al Kent is a partner wiht Strategy&'s operations practice, and is based in Florham Park, N.J.