2001 Product Development Management Columns

 

You Can't Do It Right the First Time

Hard-pressed to improve competitiveness, managers often implore us to "do it right the first time." Although this objective is laudable, it reveals that the manager pronouncing it does not understand the fundamentals of product innovation. Worse, it sets the organization up for surprises later.

An essential characteristic of innovation - and thus of product development - is that we don't have all of the information we need when we start. We can't even obtain this information in an orderly way, because, no matter how diligent we are in arranging activities sequentially, some of the information we need now will not be available until later.

Recall your high school algebra. We all learned how to solve systems of equations such as the following ones for the unknowns x, y, and z:

4x + 2y – 48z = –14

15x – 6y + 2z = 41

8x + 3y + 5z = 81

There are various straightforward ways to unravel these equations to obtain x, y, and z from them sequentially. Product development is like this: we have a few relationships (the equations here), and we would like to solve for the unknowns, hopefully using a sequential process.

Now recall how many times since you entered industry that you have actually set up a problem in this way and solved it as you learned in high school. Never? That's right! It's right because real problems in innovation are not this simple. The equations aren't so simple, and many product development relationships cannot even be expressed with a device as clear as an equation.

But the basic issue remains in innovation: we have many relationships and we must unravel them to discover the unknowns. Unfortunately, there are usually no straightforward, sequential ways to do the unraveling. This means that we have to guess at one of the unknowns, work through the others, and then loop back to see how close we came to our original guess. We keep guessing until we get through the loop with our original assumption holding up pretty well. Consequently, in innovation, we cannot do it right the first time.

Unfortunately, virtually all of the tools we have for managing innovation deny this essential characteristic of the process. We employ stages-and-gates processes that deny the reality of looping. We depend on project management's Gantt charts, network diagrams, or critical chain methods, which disallow looping.

Of course looping complicates innovation, because it makes it messy and essentially unpredictable. However, the worst consequence of looping isn't the unpredictability it causes. The bigger problem for management is the denial of its existence. When we really believe in do-it-right-the-first-time and then the looping inevitably occurs, it catches us by surprise. This is regrettable, because the looping could have been anticipated and planned into the process.

Fortunately, there are some management tools - relatively obscure ones today - that allow us to identify looping patterns, anticipate the guesses that will be needed and will have to be revisited, and then revise our development process so that reviews naturally come at the end of the loops. These tools generally go by the name of Design Structure Matrix. You might benefit from checking them out - if you would like to know where your next loop is going to occur: http://web.mit.edu/dsm/.

Return to newsletters  |  Product development publications  |    Home

Cherishing Failure

Most of us have been bred from an early age to relish success. Our parents enrolled us in Little League, piano lessons, and college so that we would succeed. Now, as adults, the thought of failure is repulsive, even though our managers pay lip service to risk taking and the likely failure that it entails. In fact, in many cases, our CEOs are the presidents of our local Success Clubs. After all, they probably got where they are due to a long string of successes.

When it comes to developing products, there is a problem with success -- we don't learn much from it. When we dissect product development, which we also call innovation, we find that it is simply a series of trials that can either fail or succeed. These trials go by various names: experiments, analyses, sketches, prototypes, and tests. In other words, we try something out and see if it works. Based on the outcome of the trial, we try something else.

Progress occurs when we learn from the trial. To make faster or more effective progress in product development, we need to arrange our trials so that we learn from them faster or better. The interesting thing about trials is that we learn the most when we cannot anticipate the outcome. If we arrange an experiment so that we expect it to succeed and it does succeed, we haven't learned anything. Similarly, if we expect failure and the outcome is failure, there is no learning. We learn the most when we don't know beforehand what the outcome will be (see figure).

"Optimal" product development is a sequence of carefully arranged trials in which the outcome of each trial is uncertain beforehand. But we can dig deeper and do even better than this. For example, sometimes success and failure behave quite differently for the various objectives of product development, such as cost, time, etc. As a result, it is better to bias our sequence of trials to take advantage of this behavior.

Consider a common case in which success is simply the lack of a failure. To determine success, we have to prove beyond a reasonable doubt that our item won't fail. This can take a long time, so it may be much faster and cheaper to run our trials biased toward failure. We run quick failure tests and inch up toward the success threshold, rather than running long tests on the success side.

These strategies depend very much on the nature of the trials. In some cases, failure is cheap and fast, and then the approach just described makes for rapid progress. But other trials are very different. If you are flight-testing helicopters, you probably want to bias your trials toward success.

We could take this further, but there are two basic take-ways:

• Trials are so fundamental to product development that you cannot afford to just let them happen. If you want to get the most out of your schedule and resources, think carefully about the trials you could run and how they could be structured to facilitate fast progress.

•  Then, assuming that some of your trials are likely to fail, prepare your organization for the failure so that they will cherish it when it happens. Everyone in your organization needs to understand just why you are designing trials to fail, especially that CEO who leads the Success Club.

Return to newsletters  |  Product development publications  |  Home

 

New Year's Resolution Check-up

Two loggers headed into the woods. From one you could hear a chop-chop-chop continuously all day. From the other, it was more of a chop-chop-pause, chop-chop-pause rhythm. At the end of the day the corporate metrics team went into the forest to collect their numbers and, to their amazement, found that the second logger had felled twice as many trees as the first one. Why? He took time periodically to sharpen his axe.

Did you have a New Year's resolution to "sharpen your axe" relative to how you were going to develop your new products in 2001? How is your resolution faring so far this year? Lost in the rat race?

Of the articles available for download on our Website, one of the three most popular ones relates to axe-sharpening: "Your Product Development Process Demands Ongoing Improvement,"

Return to newsletters  |  Product development publications  |  Home