There are key decisions that are necessary to be made quickly during the concept stage of new product development. When these decision are not made or are unclear, project schedules drift and fail to converge in time. You end up with the wrong product at the wrong time or in other words, “late and not what customers want.” When you quickly get them right, you end up with the right product at the right time. Drift and confusion at the start of projects have the greatest impact on future product success. We have seen it many times go right and also spectacularly wrong when poorly managed.
The decision points are WHAT, WHO, WHY, and VALUE.
What are we going to make?
Who are we going to make it for?
Why are we doing it or what problem are we trying to solve?
What value does the customer find in what we create?
Simple questions, rarely answered at the start of a project, often left to drift in order to keep all options open, which results in dramatic schedule slips later on when engineering teams are unable to converge on a solution, because the problem was so poorly defined upfront.
1/3 Diverge, 2/3 Converge
On fast projects, teams diverge for about a 1/3 of the timeframe and then converge no later than the remaining 2/3’s of the time. The goal is to hit the optimal market window with a product customers find value in and to deliver it when they want it. When teams take too long to make the turn towards convergence, the project is delayed, because it still takes 2/3’s of the total time to consolidate and execute a functional and manufacturable product design. Often the “diverge - converge” cycle happens over and over again and projects end up getting really long. These projects produce the wrong thing that no one will buy, because it has been obsoleted.
The key is “value” at a specific point in time. For example, the Apollo Guidance Computer (or AGC) was a true innovation when it was created by MIT over 50 years ago. It was small, rugged, and very powerful. At the time it was the smallest and most powerful computer available. It was also developed “on-time” for the moon mission schedule. Yet today, many of your IOT household devices are many times more powerful. Released today, the AGC obviously has no value. So “value” is a function of time. The most critical question for new product development teams is, “What will customers value at a specific point in time?” Do more and it will not be valued, do less and it will not be valued… the balance between right time and right product is the trick to getting it right… and perhaps the hardest thing to do with a group of engineers who lack an understanding of the cost-benefit of the diminishing-returns curve.
Diverge Stage - What are you going to make?
During the divergence stage, you are investigating, experimenting, and discovering.
What do customers want and how does this define what you make?
Who are the right customers or the superset market segments that would most value this product?
For the target segments and customers within each segment, why do they want it and what problems does it solve? And, “What problems do they have?”
Fast teams ask why and never stop asking why throughout the whole project. “Why?” uncovers the true needs and value. When the discovery process is not managed or wanders, it is virtually impossible to converge on the answers that define the right product. Of course if the discovery process is not long enough, then you may miss opportunities that could define the right product. You may be on time, but with the wrong thing.
Converge Stage - How are you going to make it?
During the convergence stage of development you define “How” you are going to do it, how you are going to implement the design that was conceived during the divergent stage. The time window also can drive these decisions about what you are making, who it is for, what problems it solves, and why it is of value to them. Very fast cycle-times require “scheduled innovation” and/or sub-system partnering with external resources, such that your work is one of integration and qualification, rather totally new development. It does not matter if the project is done inside or partially done with external partners, the team still needs to clearly define, as fast as they can; what they are doing, who it is for, why they want it, and what value they will derive from it.
In over 30 years, and on hundreds of advanced technology projects, we have seen these four questions go unanswered or get answered too late. But when the right VOC is done and teams converge on time, the chances of product success greatly improve.
On your next project ask; what are you trying to do, for whom, what problem does it solve, and what are the value drivers from the customer’s perspective?