Why Killing Failing Projects Is So Difficult

Failure1In organizations where multiple projects are being managed simultaneously, inevitably there is a sense among management as well as project teams that some projects should be postponed or killed outright and the resources re-allocated to higher value activities. Organizations regularly continue to invest in projects even though they know they are failing. Maybe there are technical hurdles, or the competitive situation has changed. In theory, the phased-development processes aid in making those decisions at the go/no-go gates for each phase. The reality in most organizations is much different. While senior management knows that some projects need to be shelved, why is there such resistance? This article addresses some of these issues.  Continue reading

The Role of Product Definition in Innovation Success-Part I

A key determinate of innovation success is a robust process for choosing and defining new products. This is part of the “fuzzy front end” and sets the stage for successful innovation. I have written extensively about the concept of the portfolio process (1), but in this two-part article I will focus on the role of a solid product definition in innovation success. Continue reading

New Product Success Rate: Why So Low?

In a recent survey (1), only about 61% of all products launched by existing companies turn out to be successful in the market. When you investigate further, however, you will find that the “best” companies have much higher success rates of around 82% vs. 59% for the “rest”. In this case, the “best” were defined as the most successful or in the top third in their industry for new product development (NPD) success, being above the mean for their new product program success, and being above the mean for sales and profit success from NPD. Why such a significant difference? What differentiates the “best” from the “rest?” Continue reading

Are Companies Becoming More Risk Averse in New Product Development (NPD) Decisions?

This is an important question to consider for any company engaged in new product development. Every project is unique. Product extensions tend to be lower risk while radical, new-to-the-market products are usually higher risk. While lower risk projects are easier to manage, higher risk projects might provide a much more significant payoff if successful. In today’s economy with fierce global competition, a focus on only lower-risk projects might not be the best decision for long-term company success. Continue reading

Is a Phased Development Process a Project Management Technique?

The new product development process (NPD) can be represented as a “funnel” or alternatively as a “vortex” as illustrated in the figure below. A funnel implies a more orderly process; a vortex better represents the chaotic nature of new product development. At the infographictop of the vortex is the universe of product ideas that a company could potentially work on. The ideas have to be screened and prioritized as every company has resource limitations and cannot possibly, nor should they, develop every idea into a product. Once a decision is made to develop the product, then a common approach is to use a “phased development process” with its series of phases and gates to guide the product development. Continue reading