Measuring New Product Development (NPD) Success

SuccessThere are two important characteristics of new product development (NPD) that are underappreciated. First, NPD is one of, if not the most complex of all business processes. I speak from experience having managed an R&D organization in a mid-sized analytical instrument manufacturer in addition to previous roles in manufacturing, sales, marketing, and customer support. I have intimate knowledge of every business process and there is no doubt that NPD is the most complex. Second, not only is NPD complex, but it is arguably one of the most important of all business processes. New products are the lifeblood of any company, manufacturing or otherwise. Those who do it well prosper. Continue reading

The Impact of the Planning Fallacy on Project Management

LateIf you think you have never heard of the “planning fallacy”, you’re wrong. Have you ever undertaken a home improvement project? Consider for example painting a bedroom. You likely came up with a task list that includes removing the furniture, preparing the walls, caulking the cracks, painting the ceiling, then the walls, then the trim…etc. You may have even attempted to lay out a schedule on how long each task would take. Now think about how much elapsed time you thought the entire project would take vs. how long it actually took. Were you overly optimistic? Did you complete the project ahead of schedule? If you are like most of us, you were overly optimistic in estimating the completion date and likely did not consider past projects and how long they actually took. This is an example of the planning fallacy and it can have a significant impact on new product development (NPD) effectiveness. Continue reading

The Importance of a Balanced Project Portfolio

Portfolio ManagementIn a recent article (1), I proposed a practical project portfolio management (PPM) system appropriate for small to mid-sized firms. A PPM system is necessary in order to make sure all ideas for new products are thoroughly considered, and a process in place to decide which ones to invest in. Most companies have far too many projects for available resources, therefore, a process to choose becomes very important, especially in today’s competitive market and tough economic times. The focus of this article is to discuss why there is a need for a balanced portfolio and what needs to be in place organizationally to achieve it. Continue reading