Innovation Management Process
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- Beverley Crawford
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1 A three-page excerpt from our 13-page Best Practice Guidebook: Innovation Management Process
2 Best Practice Guidebook Innovation Management Process growth team membership 1 guidebook summary Firm: ConvaTec Inc. Industry: Health Care Products Headquarters: Skillman, New Jersey, United States Geographic Footprint: Global Ownership: Nordic Capital and Avista Capital Partners Revenue (2010): $339 million USD Problem: ConvaTec s unstructured, ad hoc new product development process leads to highly variable profitability and launch success rates. Solution: ConvaTec builds a product development process around specific stage gates that advance, terminate, or hold a project depending on its demonstrated commercial potential. This process: Designates authority to a formalized governing body that oversees the entire innovation pipeline Requires project checkpoints for every product in the pipeline Standardizes development guidelines and evaluation criteria for all project managers Business Results: 20% increase in the value of projects in the product pipeline 30% improvement in the commercialization success rate of products in the pipeline Resources Required: Dedicated cross-functional team to baseline the current product development process and design and roll out the new one Six months total for process assessment, development, and roll-out Senior-level, cross-functional team to meet for monthly project reviews Cross-functional project management teams to oversee the development of specific products Applicability of Best Practice to Executive Functions: R&D/Innovation CEO Leadership Marketing Function Applicability
3 2 New Product Development Process: Key Components and Overview Product Development and Launch Process Process Redesign Project Contract Development Project Management Phase Review Develop a standardized process to move projects through a stage gate development pipeline. Establish a framework for evaluating all projects against a shared set of criteria. Prepare project managers to design projects that will meet specific development milestones and targets. Assess innovation projects at each stage of development based on their potential value, risk, and strategic fit. Baseline the current product development process Identify performance gaps or weaknesses Redesign the process based on findings from the baseline assessment Roll out the new process Refine the new process Develop a project contract for each phase of the development process that: Establishes go/no-go/hold decision guidelines Identifies targets for the next phase of development Measures the variance between targets and actual performance Establish inputs and outputs for each stage of product development Communicate all status updates to the overseeing governance body Negotiate specific resource needs and coordinate Extended Team activities Approve or reject projects in the innovation pipeline Advance approved projects to the next development phase Reallocate resources based on business priorities A product development process that considers multiple perspectives and criteria throughout each phase of the process Criteria, checkpoints, and guidelines that compare projects fairly and balance portfolio value with resource allocation A review process that creates a common, flexible work flow for each project type and stresses cross functional collaboration Consistent, objective assessment of projects projected value and risk that optimizes resource allocation and accelerates the time to launch
4 3 key takeaway: Solicit a cross-functional perspective for the development process redesign Functions directly involved in product development take ownership of the redesign effort Product Development Process Redesign process design team Month 1 Assess The Process Design Team conducts a gap analysis to determine what causes projects to stall in development or fail in the market. Team Members: Operations Supply Chain Marketing Clinical Medical Regulatory Quality Management Responsibilities: Baseline current product development process to identify strengths, gaps, and weaknesses Identify interdependencies between functions responsible for product development Design and implement new product development process Schedule: Meets once a week for four hours throughout the six-month development period Month 6 Design Rollout Monitor The Process Design Team redesigns the development process to include: cross-functional ownership standardized criteria formal agreements on expectations The Process Design Team rolls out the new process through: companywide communication strategies formal training on-the-job coaching Following the rollout, the Process Design Team collects feedback from stakeholders and continues to refine the process.
5 View GTM s webinar with Dr. Marcus Schabacker (Convatec, Inc.) Please contact us to learn how to access the full Best Practice Guidebook or for information on Growth Team Membership. Register us GTMresearch@frost.com for the Webinar Managing the Innovation Process for Higher Return Visit us online Please contact us to learn how to access the full Best Practice Guidebook or for information on Growth Team Membership. Visit us online us GTMresearch@frost.com GTM and Karen Marks, Director of Operations, Global Science and Innovation (proxy for Dr. Marcus Schabacker) present this best practice where Karen Marks shared her key lessons learned and participated in a Q&A session.
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