Best Practices

Question 1

Strategy

Answer 1

(1) Projects alignment with strategy
(2) Product strategy covering entire product lifecycle; including commercialization and obsolesce (exit strategy).
(3) Vision statement should be used in conjunction with Product and technology maps to help the firm outline specific tactics to achieve its strategy into future
(4) Technology strategy flows across the products

Question 2

PDMA Study

Answer 2

(1) Best firms emphasize and integrate their innovation strategy, across all levels of the firm
(2) (i) Use of formal NPD processes (ii) Having a specific NPD strategy (iii) Measuring NPD outcomes and expecting more out of the firms (iv) Multiple different types of qualitative market research including VOC, Customer visit, and beta testing
(3) Structured process for Portfolio Management
(4) Start innovation projects with a product line planning activity
(5) Strategy is applied to 74% of the projects in their portfolio

Question 3

PDMA study facts

Answer 3

(1) Avg time to market = 2-3 years
(2) New product sales % of Total = 47.6%
(3) New Product Profits % of Total = 49%
(4) # ideas for 1 success = 4
(5) Avg Cycle time: (a) New-to-the-world = 104 weeks; (b) More innovative (Major revisions) = 62; (c) Incremental = 29;
(6) Review Product portfolios Quarterly (34% of time)

Question 4

PDMA study facts (top 3 Portfolio Mgmt Tools)

Answer 4

1. Rank ordering of projects (65% of time)
2. Discounted Cashflow (61%)
3. Payback period (61%)

Question 5

PDMA study Facts (Project Portfolio distribution)

Answer 5

1. New-to-the world (8%)
2. New to the firm (18%)
3. Addition to the existing lines = 21%
4. Improvements = 36%
5. Reposition = 6%
6. Cost Reduction = 11%;
   Note: Best-firms have 5% more of their portfolio as next-generation projects

Question 6

PDMA Study Facts (NPD strategy)

Answer 6

(1) First to market (50%)
(2) Fast-Follower (32%)
(3) Niche (17%)