Post on 18-Jan-2016
STETS – STEps To SuccessNew Product Development ProcessKNMarch, 5th 2005
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Agenda
Why do we need a New Product Development Process?
What are the benefits of a New Product Development Process?
How does the New Product Development Process work?
Establishing a new Product Development Process
Why do we need a New Product Development Process?SECTION 1
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Establishment of this new Strategy requires— Organizational changes— A change of mindset — A structured process to ensure successful launch of the right
products
New Strategy requires New Methods to Succeed A Strategy Shift from Conservative to Aggressive and Innovative
Harvest & Maintain
•Leverage of domestic Market Leader Position
•Maintain existing customer relationship
•No structure for New Product Development, but successful because of excellent Product Management Staff
Growth & Develop
•Attack new Market Segments globally
•Create new customer relationships
•Create New Revenue Streams by launching successful and competitive products
What are the benefits of a New Product Development Process?SECTION 2
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Doing Products right
A New Product Development Process makes successful Launches repeatable
A New Product Development Process provides measurable results
A New Product Development Process mitigates the risk of wrong investments of time and money
Quality and Discipline are the secrets to Success
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Doing the right ProductsEven the best process will not turn moderate Ideas into Stars
Idea Bank
MarketAnalysis
OwnStrengths &Weaknesses
CustomerFeedback
CompetitiveAnalysis
FinancialMagazines &
Articles
Prod. MgmtSales
Marketing
Internal Data Sources
The more good ideas we gather, the higher the chance to find a winner
Customer Needs can be identified through various internal and external sources
Storing Ideas will build a comprehensive Data Pool for Product Creation
How does the New Product Development Process work?SECTION 3
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STETS – STEps To Success
Gate 1 – Idea Screen
Idea Bank
Scoping
Gate 2Second Screen
Build Business
Case
Development & Testing
Gate 3Go to Development &
Testing
Step 1 Step 2 Step 3
Pilot Customer
Gate 4Go to Pilot
Full Launch
Step 4Step 5Post Launch Review
Step 1 and 2 can be combined depending on how many clients are impacted and amount of revenue at
risk
Gate 5Go to Launch
Each Step is cross-functional
Each Gate consists of a set of deliverables and Criteria
Step 4 can be skippeddepending on how many clients are impacted
and amount of revenue at risk
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Gate 1 - Idea Screen
Semi-Annually workshop with cross-functional representatives of Wholesale Cash Services to identify key projects
— Product Management— Sales, Marketing and — Related Business Units like FX/CCT and IT
Evaluate ideas against Must Meet Criteria, which are defined by Senior Management upfront
— Does the idea reflect a need in our target market place (immediate or strategic)?
— Does the idea align with our strategic goals?— Can we leverage our core competencies (business and technical)?— Are market size, growth and opportunities attractive? — Is it feasible?
Ideas that don’t pass the Gate will flow back into the Idea Bank
Idea Screen
"The good into the pot, the bad into the crop"
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Step 1 - Scoping Scoping
Step 1
Preliminary Market Assessment— Internet Search— Internal Sources (SSI database, Sales Reports etc)— External Sources (Bankers Almanac etc)
Preliminary Technical Assessment— Do we have the resource capacity to develop it?— Does our current system provide the capabilities?— High Level Effort Estimate— Are there any Legal or Regulatory Risks?
Preliminary Financial Assessment— How long does it take for the project to recover its initial costs
(payback period)?PP = Cost of Project / Annual Cash Inflows
High Level Business Casecontains just enough detail to support a decision whether to proceed with product development or not (product options, strategic fit, achievability, value for money and affordability, high level financials)
Quality of upfront activities will keep the risk under control
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Gate 2 – Second Screen
Management Meeting (Product Management and IT)
Re-evaluate product against Must Meet Criteria (Go/NoGo)— Does the idea reflect a need in our target market place (immediate or
strategic)?— Does the idea align with our strategic goals?— Can we leverage our core competencies (business and technical)?— Are market size, growth and opportunities attractive? — Is it feasible?
Evaluate product against Should Meet Criteria (rated on scales)— Can it be combined with another new or existing product to make it more
attractive?— Does the product suit a global market?— Is it usable for all currencies?
How does the project align with our Project Portfolio Strategy?— Prioritize project against other new or existing projects
Products that don’t pass the Gate will flow back into the Idea Bank
Second Screen
Re-evaluate project in the light of new information obtained in Step 1
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Step 2 – Build Business Case Build
Business Case
Step 2Clearly identifies the product and verifies the attractiveness of the project prior to heavy spending
Competitive Analysis
MarketAnalysis
Product & Services
Catalogue
Technical Assessment
Market Testing
Financial Analysis
Project Plan
MarketingPlan
Expected Sales & Revenues
Market Position, Strengths and WeaknessesPricing, Anticipated Future Products
Market Size, Segmentation and SizeTrends, Competitive Situation
Customer Survey withpre-defined questionnaire
reflecting our new product offering
Describes the product benefits and features,pre-condition for the technical assessment
Detailed Map & Gap Analysis of product featuresagainst existing IT infrastructure
Target Market, Positioning, benefits & features,pricing, expected sales etc.
NPV, IRR, sensitivity analysis
Detailed Development & Testing Tasks and Milestones
Recommendation on the future of the project: Go or Kill / Hold
Ste
p 2
can
be c
om
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wit
h S
tep 1
dependin
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man
y
clie
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are
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pact
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and
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revenu
e a
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CustomerNeeds
Analysis
Interviews with Customers,
Sales, Internal Experts, Customer Service
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Gate 3 – Got to Development & Testing
Senior Management Meeting (Business and IT Owner)
Review of performed activities/deliverables in terms of— Completeness— Quality— Achieved Results
Review the Project Plan
Re-evaluate product against Must Meet and Should Meet Criteria of Gate 1 & 2
Rate additional Gate 3 specific criteria— Is the expected profitability high enough (NPV in CHF)?— Is the expected percentage of return high enough (IRR and ROI)?— Do we feel comfortable with the certainty of return/profit/sales estimates?
Go / No-Go(or Hold) Decision
If Go, Designate cross-functional project team and clear project lead, who will oversee the whole project
Products that don’t pass the Gate will flow back into the Idea Bank
Past Gate 3 Financial Commitments are Substantial!
Go to Development &Testing
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Step 3 – Development & Testing
Parallel Processing of IT and Business
IT — Develops Functional and Technical Specifications based on Detailed Product
Definition (Business Requirements). — Functional Specifications will be signed-off by Business before
Development starts— Software Development & Testing
Product Management, Sales, Marketing— Finalize Marketing Plan
– Develop Detailed Market Launch Plan (incl. Contingency Plan)– Detailed Pricing Model and Pricing
— Develop Product Description— Develop SLA, FAQs, Fact Sheets— Pilot Customer Implementation (for mid to big size projects)
– Identify Pilot Customer– Prepare Pilot Customer Implementation
— Resolve Legal or Regulatory Issues— Update Financials if more detailed information are available— Train and motivate Internal Staff (Sales Force, Customer Service, Product
Management etc)
Change of scope or market leads back to Step 2 (Build Business Case)
Development & Testing
Step 3
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Gate 4 – Go to Pilot
Management Meeting (Product Management and IT)
Review of performed activities/deliverables in terms of— Completeness— Quality— Achieved Results
Meeting with Pilot Customer— Ensure all required documents are signed and customer is ready to go “live”
Go / No-Go Decision for Pilot
If investments are substantial and reputation risk high a Pilot is required
Go to Pilot
Ste
p 4
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Step 4 – Pilot Customer
Limited transaction volumes as defined with Pilot Customer to reduce processing risk
Close work with customer allows us to — Obtain first hand feedback to eliminate errors and gain ideas for
new products or product enhancements — Perform Customer Survey to obtain measurable feedback
Successful pilot provides us with security for full launch and can be used by Sales Force as marketing element
Update Financials (Final NPV, IRR, sensitivity analysis)
Gain Experience and Obtain First Hand Feedback
Pilot Customer
Step 4
Ste
p 4
can
be s
kip
ped d
epend
ing o
n h
ow
many c
lients
are
im
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nd a
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of
revenue a
t ri
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Gate 5 – Go to Full Launch
Management Meeting (Business)
Review Results of Testing (and Pilot)
Review Revised Financials
Go / No-Go Decision for Full Launch
Final Point at which project still can be killedGo to Launch
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Step 5 – Full Launch
Implement Market Launch Plan
Activate Sales Force
Announce New Product (external and internal)
Celebrate the Successful Launch
All Project Team Members get a great bonus ;-)
Here we are – a new great product is on the market
Full Launch
Step 5
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Post Launch Review
Review Costs, Profits
Score Project and Product based on pre-defined criteria
Lessons learned session— Project team workshop to assess Quality of Project
Execution
Use the results to “tune” and enhance STETS
Learn from ExperiencePost
Launch Review