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Volume 5, Issue 1 - January 21, 2004
GGI RapidNews is published approximately once a month.
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Due to new legislation regarding appropriateness of email
communications that went into effect on January 1, 2004 our
ISP has taken the last three weeks to make necessary server
and configuration changes to allow legitimate electronic periodicals,
such as GGI RapidNews, to continue to flow without interruption.
To all of our dedicated readership, the vast majority of whom
have received GGI RapidNews for between two and five years,
we will be back on schedule at the beginning of next month.
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In This Issue
NEWS & NOTES - Happy New Year,
Redesigned Home Page, Complimentary Quotations
2002 METRICS SURVEY RESULTS
2004 METRICS SURVEY
BOOK REVIEW - Radical Innovation
MANAGEMENT PRODUCTIVITY - R&D Metrics:
Make the Link
NEW BIENNIAL SURVEY - 2002 RD&E
Survey Results available now
NEW WEB CONTENT - Updated GTKs: Calendar
FEATURED iSTORE PRODUCT - Product Development
Metrics Portfolios Coursebook
CONFERENCES OF INTEREST - MRT Improving
R&D Productivity, Brandworks University
WEBINARS OF INTEREST - Sopheon's Winning
Practices for Product Development
TELEVISION EVENTS - Alexander Haig's
World Business Review
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NEWS & NOTES
Happy New Year: All of us here at GGI wish you a happy and
healthy new year. We send our best wishes for a prosperous
and fulfilling 2004 in all of your pursuits.
Redesigned Home Page: Check out our redesigned home page.
We have added graphics and have placed key items front and
center for easy access. It has been a few years since GGI
relaunched our home page.
Complimentary Quotations: GGI has just made ten of our "Quotations,"
which are reprints of articles where GGI's work has been referenced
or cited, available for free download from our web site. These
were published prior to 1998 and were previously sold in our
iStore. These articles cover a range of topics, including
concurrent product development, metrics, rapid time-to-market,
and teamwork. To view the list of complimentary Quotations,
and to download them, go to http://www.goldensegroupinc.com/comppublist.shtml.
For our most recent publications, visit the iStore at http://www.goldensegroupinc.com/cgi/catalog.cgi.
2002 BIENNIAL METRICS SURVEY RESULTS
GGI's 2002 Biennial Product Development Metrics Survey, which
focused on resource and capacity management practices and
metrics, was published earlier this year. From April through
August 2003, GGI shared with RapidNews readers selected results
from each section of the survey, with the survey population
considered as a whole. We also analyzed the data in "Special
Cuts" by segmenting the population into the following
five groups: Public vs. Private, Smaller vs. Larger, Process
vs. Repetitive/Discrete vs. Job Shop Operations, Higher Technology
vs. Lower Technology, and More vs. Fewer Employees. Over five
months, we will share selected results from each of these
segment analyses. This month, we present the fourth segment,
selected findings from the "Higher Technology vs. Lower
Technology" segment.
- 86% of Lower Tech companies and 68% of Higher Tech companies
had a "2.5-Step" or "2-Step" Product Selection
Process.
- All of the Higher Tech firms, versus 72% of the Lower Tech
firms, reported having a "Formal Meeting" at Milestone
Two, at which the final selection decision is made.
- Development professionals in Higher Tech firms dedicated
more of their time to new products (73%) compared with their
counterparts in Lower Tech companies (58%).
- 77% of Higher Tech companies had either a stated or derived
set of metrics as opposed to 67% of Lower Tech firms that
could identify the metrics used to manage.
Next month, look for the fifth and final segment, "More
vs. Fewer Employees."
To view selected results of the survey population as a whole,
look in the GGI RapidNews archives: http://www.goldensegroupinc.com/GGI_RapidNews/Rnews.shtml
The original survey questionnaire can be downloaded at http://www.goldensegroupinc.com/biennial/surveys/2002MetricsSurvey.pdf.
Complete survey results are available for purchase at http://www.goldensegroupinc.com/cgi/catalog.cgi?display_p355.
2004 BIENNIAL METRICS SURVEY
GGI's next Biennial Product Development Metrics Survey will
be conducted in 2004, beginning soon. We are now in the planning
stages. Please contact me at ars@goldensegroupinc.com
if you wish to participate as part of our early Beta-Test
group to proof the survey. If you are receiving this RapidNews
issue, you will also receive an invitation to participate
in the survey, possibly several invitations. All participants
will receive a complimentary copy of the detailed Executive
Summary of the Survey results if they submit a completed survey.
BOOK REVIEW
Radical Innovation: How Mature Companies Can Outsmart Upstarts,
by Richard Leifer, Christopher M. McDermott, Gina Colarelli
O'Connor, Lois S. Peters, Mark P. Rice, and Robert W. Veryzer.
Harvard Business School Press. 2000, 1st edition. 261 pages.
Most radical innovations originate from small entrepreneurial
firms, but large, established companies can gain competitive
advantage by driving radical innovation within their firms
using the ideas presented in Radical Innovation. Based on
a five-year study of twelve radical innovation projects in
ten major corporations (including GE, IBM, Nortel Networks,
DuPont and Texas Instruments), the book examines managerial
challenges large firms face in creating and sustaining radical
innovation, several of which will be summarized here. The
authors, all professors at Rensselaer Polytechnic Institute's
Lally School of Management and Technology, define radical
innovation as "a product, process, or service with either
unprecedented performance features, or familiar features that
offer potential for significant improvements in performance
(500% better) or cost (30% reduction)."
The first managerial challenge to address is capturing radical
ideas in the "fuzzy front end." Large companies
have huge technical resources but often have difficulty converting
that knowledge base into radical innovation projects. Effective
companies focus on the key activities of idea generation,
opportunity recognition and initial evaluation to bridge the
gap. For a radical idea to move forward, the business potential
must be recognized. The authors recommend formation of "radical
innovation hubs," which act as a home base to link people
with ideas, those seeking and gathering ideas, opportunity
evaluators and other key people in R&D and the business
units. Hubs ensure that ideas have a place to go and there
is a structured process for making front-end decisions. Hubs
can serve as repositories for the cumulative learning about
managing radical innovation and can also allow the company
to perform benchmarking.
Radical innovation teams must reduce technical uncertainty
as well as market and business model uncertainty -- "how
can this innovation make money?" This is an expansion
of the traditional role of R&D. R&D folks involved
in radical innovation must have more of an entrepreneurial
mindset, rather than a strictly technical focus. The innovation
team must learn about emerging markets "on the fly"
instead of relying on traditional market research. The team
must also focus on bringing the product to market using a
new business model, which will require senior management support.
The radical innovation project competes with other activities
for resources and support; team members must be prepared to
face resistance and to proactively acquire the needed resources
and competencies. Finally, this change process can only succeed
with a strong push from the executive team who can act as
champions and shapers of a culture that values and promotes
radical innovation. "Those firms that excel in developing
and implementing a radical innovation capacity will have a
tremendous source of long-term competitive advantage."
MANAGEMENT PRODUCTIVITY
R&D Metrics: Make the Link
"Coming Up Short on Nonfinancial Performance Measurement",
by Christopher D. Ittner and David F. Larcker. Harvard Business
Review, Harvard Business School Publishing Corporation: Volume
81, Issue 11, November 2003, pages 88-95.
R&D metrics as well as other nonfinancial measures are
now being tracked by more and more companies in an attempt
to chart business progress and overall performance more comprehensively
than that reported by strictly financial measures. Many companies,
however, are not taking full advantage of nonfinancial measures
because they are not identifying, analyzing and acting on
the right ones, nor are they linked to corporate strategy.
In research of over 60 manufacturing and service companies,
the authors found that only 23% of companies developed and
validated causal models (also called value driver maps) linking
drivers of strategic success and the outcomes. Failure to
connect improvement actions to outcomes can result in manipulation
of the measures, basing decisions on wrong assumptions, or
measuring unimportant things. For example, one company began
evaluating managers' performance based on number of patents
filed annually, simply because a competitor owned more patents;
it might have made more sense to investigate whether the patents
were used, or whether they earned back their cost. Other mistakes
companies make with nonfinancial measures are not setting
the right performance targets, or measuring incorrectly, inefficiently
or inconsistently.
Nonfinancial metrics can have powerful effects on long-term
performance, if set up and used correctly. First develop a
causal model that links performance to strategic success.
Next pull the data together, whether existing data already
being collected or new data needed. Using the data and statistical
tools such as correlation and regression analyses, test the
model for statistical validity and reliability. Continue to
reassess and refine the model as conditions change. The data
analysis, not assumptions, should be the basis for decisions
that can drive financial performance. Finally assess whether
the action plans actually produced the desired results through
post-audits.
Note: For more information and a powerful technique to develop
a linked set of R&D metrics, consider our recent technical
papers, T40 - "Linked Metrics Portfolio(TM) Method ...
A Primer" or T39 - "Linked Metrics Portfolio(TM)
Method ... Applied to Four R&D Strategies." These
can be found in our iStore at http://www.goldensegroupinc.com/cgi/catalog.cgi.
NEW BIENNIAL SURVEY
2002 RD&E Survey - Resource & Capacity Management:
Complete results from our 2002 Product Development Metrics
Survey are now available, including our most detailed "RESULTS"
report.
The survey focused this year on the following 5 areas of
resource and capacity management:
- Loading the RD&E capacity pipeline,
- Providing capacity for RD&E activities,
- Balancing cross-functional resources (staffing ratios),
- Using systems, tools, & metrics to manage capacity,
and
- RD&E metrics used in industry.
The 3 versions of the survey results reports that we offer
for sale to the public are
1. 2002 SURVEY HIGHLIGHTS: A text-only report (65 pages),including
the full text of all the results and analysis of the survey
population analyzed as a whole,
2. 2002 SURVEY SUMMARY: A report of composite results, where
the survey respondents are analyzed as a whole (116 pages,
including a full set of graphics), and
3. 2002 SURVEY RESULTS: The most detailed report, complete
with the composite results and "special cuts," where
the survey population is segmented and analyzed in the following
groups: Public vs. Private, Smaller vs. Larger, Process vs.
Repetitive/Discrete vs. Job Shop, Higher Technology vs. Lower
Technology, and More vs. Fewer Employees (223 pages).
These reports are available in the Market Research section
of GGI's iStore (http://www.goldensegroupinc.com/iStore/store.html).
The original survey questionnaire as well as a description
of the survey (including survey focus and demographics, tables
of contents for the 3 reports, and examples of key findings)
can be found at the Market Research Reading Room at http://www.goldensegroupinc.com/readmarket.shtml.
NEW WEB CONTENT
Redesigned Home Page: Check out our redesigned home page.
We have added graphics and have placed key items front and
center for easy access. It has been a few years since GGI
relaunched our home page.
GTK-Gateways To Knowledge: Your resource for industry and
product development related information and contacts offers
thousands of links to providers of technologies and services
for line management functions. The main entrance to GTK can
be found at:
http://www.goldensegroupinc.com/gateway/index.shtml
One of our top 3 MEGA Gateways is the Calendar of Industry
Events MEGA Gateway, a listing of links to Conferences, Seminars,
Distance Learning Centers, Webinars, Colleges & Universities,
Executive Education, and Corporate-Sponsored Universities.
The calendar has just been updated with approximately a dozen
new seminars and conferences. If you are planning the coming
year's training, check out the Calendar first. This free service
for our readers will soon be front and center on GGI's Home
Page. For the next few months, please find the Calendar of
Industry Events MEGA Gateway at:
http://www.goldensegroupinc.com/gateway/calendar2.shtml
FEATURED GGI iSTORE PRODUCTS
Featured Item: GGI's iStore features one deeply discounted
offering, which changes periodically. The current Featured
Item is the "Product Development Metrics Portfolios Coursebook"
(S4).
The Product Development Metrics Portfolios (PDMP) Coursebook
is your detailed guide to understanding and creating linked
portfolios of metrics for managing the R&D organization
overall as well as the projects, functions and improvement
initiatives within R&D. The coursebook accompanies the
intensive seminar of the same name, and is useful on its own.
The coursebook (and seminar) guide you through the Linked
Metrics Portfolio (TM) Method, a powerful, step-by-step methodology
to create a linked set of metrics portfolios. The coursebook
includes perspectives on goal setting; and descriptions of
infrastructures for corporate vs. project metrics and proactive
vs. predictive metrics. Examples are provided for a dozen
different metrics structures, such as corporate metrics, capacity
management metrics, project team metrics and functional metrics.
Details on sizing, assembling and implementing a metrics portfolio
are also provided. With the help of the PDMP Coursebook, you
can develop a comprehensive set of metrics using the Linked
Metrics Portfolio (TM) Method that accurately reflects the
current performance of your R&D efforts and can guide
future performance.
The price for the Coursebook has been dropped from $695.00
to $417.00, a deep discount of 40%. For more information or
to purchase this valuable report, go to
http://www.goldensegroupinc.com/cgi/catalog.cgi?display_promo.
CONFERENCES OF INTEREST
MRT Improving R&D Productivity Conference: Management
Roundtable will hold its conference, "Improving R&D
Productivity: How to Link Resource Management to Portfolio
Process," on March 29-31, 2004 in Atlanta, GA. The conference
focuses on how to leverage increasingly limited resources
and ensure that priority projects are properly resourced.
The conference features a full day of pre-conference workshops
plus two days of presentations and case studies aimed at providing
you with strategies and tools to assess and allocate resource
capacity to boost productivity.
Brad Goldense will be giving a featured presentation, "Key
Pipeline Practices Drive Effective Capacity" on Tuesday,
March 30, 2004. The presentation focuses on seven practical
best practices for pipeline management that improve capacity
utilization and improve yield.
More information can be found at MRT's web site: http://www.managementroundtable.com/Event_Center/PPM04/PPM04.html
Brandworks University: Lindsay, Stone & Briggs will hold
"Brandworks University" on May 25-26, 2004 in Madison,
Wisconsin. Brandworks University is considered "the world's
premier conference on branding." The conference theme
is "How to have smarter, more successful new product
launches." Attendance at the conference is by invitation
only, and limited to 300 top U.S. marketing leaders.
Brad Goldense has been invited to speak at this year's Brandworks
University. Details are still being finalized. We will provide
more information next month.
For more information, go to Lindsay, Stone & Briggs'
web site: http://www.lsb.com.
WEBINARS OF INTEREST
Winning Practices for Product Development: This free, online
seminar series is co-sponsored by Sopheon and the Society
of Concurrent Product Development [SCPD]. These one-hour,
online events feature experts and leading practitioners who
will share process knowledge and practical advice about ways
to improve your product development performance and results.
There are currently no scheduled webinars, but more are under
development. Check back here next month for more information.
Past Webinars have been archived and are available online
at http://www.sopheon.com/events_onlineseminars.asp.
TELEVISION EVENTS
Alexander Haig's World Business Review: Brad Goldense has
made several appearances on Alexander Haig's World Business
Review in the past year. Streaming video is available for
all shows, which aired on August 4, September 29 and December
15, 2002 and on May 20, 2003. See below for details.
May 20, 2003 Broadcast of September 29th In-Studio with Alexander
Haig (22.5 minutes): Streaming video for this segment is available
at: http://www.goldensegroupinc.com/ggiontv.shtml#wbr5
December 15, 2002 In-Studio with Alexander Haig (7.5 minutes)
on CNBC paid programming: Streaming video for this segment
is available at: http://www.goldensegroupinc.com/ggiontv.shtml#wbr3
September 29, 2002 In-Studio with Alexander Haig (22.5 minutes):
Streaming video for this segment (as well as the entire 30-minute
show) is available at: http://www.goldensegroupinc.com/ggiontv.shtml#wbr2
August 4, 2002 On-Location at GGI (3.5 minutes): This On-Location
field report is available in streaming video on GGI's website.
To see the program, go to: http://www.goldensegroupinc.com/ggiontv.shtml#wbr1
The web page includes links to download a streaming video
player, if you do not currently have one installed on your
computer.
For more information on any of Brad's appearances on television,
go to:
http://www.goldensegroupinc.com/ggiontv.shtml.
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GGI RapidNews is an e-mail publication from Goldense Group,
Inc (GGI). Its subject matter includes survey findings, company
news, book and article reviews, key industry conferences and
R&D information of interest to clients and associates.
Please send communications to rn(at)goldensegroupinc.com.
Thank you.
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