management be lean · top factors in product success correlationof factors: with time efficiency...

From Factory Floor to Your Cubicle:  

Can ProductCan Product Management Be 

?PCS 2013Lean?

Why are we here?Why are we here?

• One product concept in seven becomesOne product concept in seven becomes a winner

• 44% of product development projects44% of product development projects fail to achieve their profit targets

• 49% of product development projects• 49% of product development projects miss their launch date targets (by 35% of their original schedule)of their original schedule)

• 28% of businesses don’t measure their new product development results

© Pivotal Product Management, LLC 2

new product development resultsSource:  Cooper & Edgett, Lean, Rapid, and Profitable New Product Development, 2005

How do “Best in Class” fcompanies perform?

• 77% of product efforts meet profit77% of product efforts meet profit objectives

• 80% of product efforts are considered• 80% of product efforts are considered successful79% l h h d l• 79%  launch on schedule, slippage is reduced to 17%

© Pivotal Product Management, LLC 3

Source:  Cooper & Edgett, Lean, Rapid, and Profitable New Product Development, 2005

What conditions create blsustainable success?

• Speed: Not necessarily ‘first to market’• Speed:  Not necessarily  first to market , but best to market, on time–Delivers competitive advantage–Results in higher profitabilityg p y–Keeps pace with fast‐changing markets

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Source:  Cooper & Edgett, Lean, Rapid, and Profitable New Product Development, 2005

Bosses want more, faster!Bosses want more, faster!

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Speed = Lean?Speed   Lean?

Lean’s goal: Find the shortest fastest path toLean s goal:  Find the shortest, fastest path to deliver maximum customer value.

How can we leverage Lean principles in Product M l kManagement to get more value to market, 

faster?

© Pivotal Product Management, LLC 6

Key Lean Principles and Practices• Reduce waste

– Value stream analysis– Right metrics:  focus on value– Quantifying the cost of delayQuantifying the cost of delay

• Pull, not push– Kanban & WIP limits

• Flow– Small batch, moving to flow

• Respect for peopleRespect for people– Decentralized decisions

• Continuous improvement

7© Pivotal Product Management, LLC

Value Stream AnalysisValue Stream Analysis

Submit to  Assign Submit OptOpt

Assign product council

IdeaIdeaAssign PMApproveApprove business 

case

OptyAnalysisOpty

Analysis dev team

ApproveApprove

V lValue

Waste

To verification

Design, Build TestDesign, Build Test

To OperationsValidationValidation Gain valueLaunchLaunch

Efficiency =Value

Waste

Efficiency   Total Value/

(Total Value+TotalWaste)

8© Pivotal Product Management, LLC

Lean‐ing the Front EndLean ing the Front End

b A iSubmit to product council

IdeaIdeaAssign PMApproveApprove

Submit business case

OptyAnalysisOpty

Analysis

Assign dev team

ApproveApprove

• Identify value stream

•Strategic 

• Initial screening and decision 

• Customer Development 

• Lean or 

•WSJF or Cost of Delay Prioritization

bucketing•Portfolio strategy

criteria Business Canvas

WIP Limits, Smaller Batch Size

9© Pivotal Product Management, LLC

Lean‐ing the Back EndLean ing the Back End

To verification

Design, Build TestDesign, Build Test

To OperationsValidationValidation Gain valueLaunchLaunch

Poppendiecks’ 7 Wastes in Software DevelopmentPoppendiecks  7 Wastes in Software Development1. Partially done work:  Smaller batch sizes, re‐prioritize between 

batches2 Extra features: MVP Validated learning2. Extra features:  MVP, Validated learning3. Re‐learning:  Dedicate teams to product lines4. Hand‐offs:  Cross‐functional teams5. Task switching: Dedicated teams stable teams smaller batch size5. Task switching:  Dedicated teams, stable teams, smaller batch size6. Delays:  Limit Work In Process7. Defects:  Team closer to customer/PO, Test Driven Development, 

Continuous IntegrationContinuous Integration

10© Pivotal Product Management, LLC

Lean‐ing the Back EndLean ing the Back End

To verification

Design, Build TestDesign, Build Test

To OperationsValidationValidation Gain valueLaunchLaunch

• A/B testing• Eliminate though  

•Measurable marketing

better Customer Development

11© Pivotal Product Management, LLC

Top Factors in Product SuccessCorrelation of factors: With time efficiency  With profitability 

and on‐time launch (NPV, Payback)

Unique, superior product No effect 0.530Customer focused 0 406 0 440Customer‐focused 0.406 0.440Cross‐functional teams 0.483 0.351

Front‐end loaded 0.408 0.366Sharp, early product definition 0.242 0.413

Market attractiveness 0.215 0.312

Q lit f th l h 0 205 0 286Quality of the launch 0.205 0.286

1.0= perfect 1:1 correlationSource:  Cooper & Edgett, Lean, Rapid, and Profitable New Product Development, 2005

12© Pivotal Product Management, LLC

ReferencesReferences

• Cooper & Edgett, Lean, Rapid, and Profitable New Coope & dgett, ea , ap d, a d o tab e eProduct Development

• Ries, Lean Startupp• Blank & Dorf, Startup Owner’s Manual• Reinertsen, The Principles of Product , pDevelopment Flow

• Poppendieck, Implementing Lean Software Development

• Leffingwell, Agile Software Requirements

© Pivotal Product Management, LLC 13

Want more?Want more?

• Learn more about Lean Product ManagementLearn more about Lean Product Management– Upcoming workshops

• Pivotalpm com/LeanPMI‐OnsitePivotalpm.com/LeanPMI‐Onsite• Pivotalpm.com/LeanPMI‐Public

– Contact me: lindam@pivotalpm.comContact me:  lindam@pivotalpm.com425‐806‐6982

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