The Consulting Playbook, Edition #11
Welcome to our new series, the Consulting Playbook, a collection of posts designed to offer insights into how businesses and their executives can utilize consulting as a strategic lever to boost performance. Each Consulting Playbook post is broken down into a few elements: Case Study, Additional Information regarding the technical application, and Additional Links related to the topic.
How a Merger Achieved Synergy in the Product Development Process
One of the leading Aerospace and Defense companies undertook a major transformation when a merger of several companies took place. To ensure the successful integration, the Head of Integration needed help. The main priorities of the company were secure: Integration of the overall organization, Increase Corporate Performance, and Enable efficiency and collaboration on all levels.
To speed up and facilitate the process, they requested external support in the definition and application of a new Product Development Process reference that would allow a proper alignment on through a backbone process of the company.
A 3-Step Approach to Deliver the Desired Results
The Consultant focused their efforts on building a collaborative environment and helping all parties understand the process with the application of stage gates and dedicated development phases.
A Multi-Step Approach was applied to achieve the desired objectives:
- Definition of the development timeframe, with specific sequence in stage gates
- Synchronization of the development, design and delivery of key components and systems
- Implementation of collaborative approaches to manage concurrent development, product lifecycle and interdependencies.
- Review the main criteria to determine each stage gate adjustments to the sub-processes to achieve the expected performance (lead time, reliability, etc.) through multiple sub-projects involving experts of all legacy companies.
This new approach was implemented on the new strategic project from the company embarking employees from all legacy companies in the journey.
Beneficial Impact of the Consultancy, Following the Merger
The successful completion of the project, to the client’s satisfaction, achieved the following:
- The new Product Development Process accomplished reduction of development lead times, more effective and realistic expectations, better collaboration of various teams
- Improved planning and management of development programs in collaboration with functions
- An overall cost reduction of 20% vs. previous similar projects.
Additional Information –
New Product Development in 4 Simple Stages
Companies and entrepreneurs often feel the need to introduce new products. And depending on the industry you are in; the process might be less or quite complex. But without new products, extension line of existing products and innovation, it is tough to stay competitive, relevant and profitable in the long run. As technology constantly evolves, so are customers’ needs.
Let’s look at a typical new product development stages and what is the most efficient way to proceed with new product idea.
- Generation and Evaluation of Product Ideas
To greenlight an idea, it’s best to have a few brainstorm sessions with your team, and the people whose decisions and opinions matter, decide on the best idea, then go to the next stage. Your new product ideas can come from a variety of sources such as: your employees, your boss, competitors, and even customers. Evaluate carefully the pros and cons of each idea, and then decide on the feasibility of pursuing it. It’s estimated that a third of new product ideas originate from users and customers. At this initial stage, often a niche market research is required, to get a deeper understanding of the potential of the new product idea.
The journey of the great new idea to the market, continues with development of a Product concept. Once you have this ready, you can test the sample with consumers and team members, capture their reactions and make further adjustments as necessary. After the testing is completed and the product features finalized, the new product can scale up into production.
- Customized Marketing Strategy
Even the greatest product can fail without a well-planned marketing strategy and sufficient support to promote it. The marketing strategy typically will consist of: identification of the target market and demographics, branding and positioning, sales and market share projections for the first one or two years. It’s essential to also identify the main distribution channels, pricing, marketing budget, and profit goals.
- Mass production and Commercialization of the New product
With the marketing strategy set, and the Business analysis completed, the Management team will decide on the next and final stage – commercialization of the new product. The cost of manufacturing, marketing and advertising of a new product, can be quite high, so the Management should consider all the factors like timing, region, logistics, important events, etc, for the official launch and initial distribution of the new product.
Since for many companies, time is of the essence, a new and more flexible approach is being introduced: close collaboration and simultaneous development of the new product by the parties involved, to complete it and launch sooner.
Saving time and money is always a winning proposition to businesses and customers alike when developing new products.
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