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Page 1: Author's personal copy - Indutech...Author's personal copy Improved innovation through the integration of Quality Gates into the Enterprise and Product Lifecycle Roadmaps M. Giebela,*,

This article appeared in a journal published by Elsevier. The attachedcopy is furnished to the author for internal non-commercial researchand education use, including for instruction at the authors institution

and sharing with colleagues.

Other uses, including reproduction and distribution, or selling orlicensing copies, or posting to personal, institutional or third party

websites are prohibited.

In most cases authors are permitted to post their version of thearticle (e.g. in Word or Tex form) to their personal website orinstitutional repository. Authors requiring further information

regarding Elsevier’s archiving and manuscript policies areencouraged to visit:

http://www.elsevier.com/copyright

Page 2: Author's personal copy - Indutech...Author's personal copy Improved innovation through the integration of Quality Gates into the Enterprise and Product Lifecycle Roadmaps M. Giebela,*,

Author's personal copy

Improved innovation through the integration of Quality Gates into the Enterpriseand Product Lifecycle Roadmaps

M. Giebel a,*, H. Essmann b, N. Du Preez b, R. Jochem a

a Department Quality Management, Institute for Industrial Science and Process Management, University of Kassel, Germanyb Department of Industrial Engineering, Global Centre for Competitiveness, University of Stellenbosch, South Africa

1. Introduction

This paper presents research conducted in the fields ofinnovation and quality management, and more specifically, theintegration of these two paradigms. The objective is to improve theconsistency, predictability and eventual outcome of an organisa-tion’s innovation process.

1.1. Innovation defined

The first mentions of the notion of innovation stem from theearly works of Joseph Schumpeter, with the publication of hisTheory of Economic Development. He defined innovation asencompassing the entire process, starting from a kernel of anidea, continuing through all the steps to reach a marketableproduct that changes the economy. Furthermore, he distinguishedbetween five types of innovation: those that result in newproducts, new methods of production, new sources of supply, theexploration of new markets, and new ways to organise business[1].

The conceptual works of Peter Drucker proposed a broaderdefinition. Innovation was considered the process of equippingin new, improved capabilities or increased utility. He furtherstated that innovation was not a science or technology, but rathera value that is measurable through environmental impact. Focal to

Drucker’s discussions was the need for market orientation. Heargued that product-oriented efforts tended to result in ‘‘tech-nology miracles’’ or inventions that often fell short of the marketrequired benefits [2].

Nohria and Gulati define innovation to include any policy,structure, method, process, and product or market opportunitythat the manager of an innovating unit perceives to be new [3].Damanpour defined innovation to be ‘‘the generation, develop-ment, and adoption of novel ideas on the part of the firm’’ [4].Zaltman et al. defined it as ‘‘any idea, practice, or material artefactperceived to be new by the relevant unit of adoption’’ [5].

The European Commission defines innovation to be ‘‘thesuccessful production, assimilation and exploitation of noveltyin the economic and social spheres’’ [6]. This definition is similar tothat of the Lisbon European Council’s perception of innovation andcompetitiveness [7]. Further description by the European Commis-sion states it to be ‘‘the renewal and enlargement of the range ofproducts and services and associated markets; the establishmentof new methods of production, supply and distribution; theintroduction in changes in management, work organisation, andthe working conditions and skills of workforce’’ [6].

The abovementioned definitions of innovation, when consoli-dated, convey two fundamental aspects that may characterise aninnovation. Summarised, they are: a novelty or newness associatedwith innovation activities, and the presence of an inherent process[8]. Thus, for an initiative to be considered innovative, a certaindegree of novelty or newness must be evident in that initiative, anda process (or lifecycle) must be executed to ensure fruition of thatinitiative.

CIRP Journal of Manufacturing Science and Technology 1 (2009) 199–205

A R T I C L E I N F O

Article history:

Available online 26 November 2008

Keywords:

Innovation

Quality Gate

Enterprise and Product Lifecycle Roadmaps

A B S T R A C T

Studies have shown that only a very small number of initiated innovation projects result in market

success. The problem is the conversion of good ideas into successful innovations. To address this problem

and improve the innovation process, the Quality Gate methodology and generic Enterprise and Product

Lifecycles based on a roadmapping methodology have been combined. In addition, a risk assessment that

determines the selection of and extent to which gate criteria are evaluated, is combined in a methodology

and introduced in a collaborative, web-based platform. The software contains the necessary components

to build a structured roadmap and, by guiding a project team through the lifecycle with integrated

Quality Gates, improve innovation.

� 2008 CIRP.

* Corresponding author. Tel.: +49 561 804 4675; fax: +49 561 804 4673.

E-mail address: [email protected] (M. Giebel).

Contents lists available at ScienceDirect

CIRP Journal of Manufacturing Science and Technology

journa l homepage: www.e lsevier .com/ locate /c i rp j

1755-5817/$ – see front matter � 2008 CIRP.

doi:10.1016/j.cirpj.2008.10.004

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1.2. Quality and Innovation

Quality and innovation have often been considered opposingparadigms in strategic and operational spheres of organisationalmanagement. However, commonalities between quality manage-ment (and Total Quality Management in particular) and innovationmanagement have been identified [9]. Both have emerged as(partial) answers to intense competitive pressure facing organisa-tions [10], yet the literature presents several conflicting theoreticalarguments with regard to the relationship between TQM andinnovation management.

Arguments supporting a positive relationship between TQMand innovation contend that organisations embracing TQM intheir systems and culture will provide a fertile environment forinnovation because the principles embodied therein are con-gruent with those required for innovation. [11–15] Considercontinuous improvement – a critical aspect of both TQM and(incremental) innovation. Further, consider the so-called ‘‘openculture’’, also an important factor for both these seeminglycontradictory notions. Such commonalities suggest that organi-sations that implement TQM could also be more innovative thanorganisations that do not [10]. If this is the case, then theparadigms of quality and innovation are certainly not opposing.

In contrast to the abovementioned arguments, several scholarsof this debate reject that there is any positive correlation betweenTQM and innovation management. They claim that TQM possessesprinciples and practices that could potentially hinder the processof innovation [9]. Slater and Narver [16] and Wind and Mahajan[17] agree that a so-called ‘‘customer-focus’’ could lead toorganisations over-emphasising the incremental improvementof their current products and services, neglecting the need for newand novel solutions. Consequently, they continue the developmentof uncompetitive ‘‘me-too’’ products rather than creating realinnovations [9].

Williams [18] argues that organisations with a strategy torapidly generate innovations do not have the time to learn andstudy the processes and statistically control them in order toachieve a high degree of conformance. He further argues thatorganisations may have to strike a balance, i.e. prioritise qualityover innovation or vice versa, based on the requirements of thesituation. This is particularly true when industry and marketconditions are taken into consideration [19].

Consider a statement made by Maguire and Hagen [[20], p. 30]:‘‘For quality practitioners, this explosion of innovation activityrepresents significant challenges. While they can expect to seeincreased demand for some of their specialized knowledge andskills, they must be prepared to master new tools and techniqueswhile also giving serious consideration to how quality may beredefined in this environment of rapid change and rising customerexpectations.’’ This statement conveys the very complex challengethat organisations are facing in the modern competitive environ-ment. Business excellence frameworks such as the AustralianQuality Awards, which were initially seen as TQM models,postulate that the quality and innovation constructs are inter-related in complex ways [10].

1.3. From invention to innovation – the need for structure

The process of invention has been around since the beginningof time. Inventive efforts have primarily been directed towardsthe enhancement of human existence and society in general, withsome exceptions of course. Nevertheless, the intention of thissection is to highlight the stark difference between inventionand innovation – a difference that can easily and erroneously bedisregarded [21].

Very basically, invention is the generation of newness ornovelty, while innovation is the derivation of value from thatnovelty [7]. Clearly, innovation is an extension of invention, yetthey are distinguished by the fact that the quantity of inventionsexceeds that of innovations by several orders of magnitude. Hamelstates, ‘‘Innovation in whatever form follows a power law: Forevery truly radical idea that delivers a big dollop of competitiveadvantage, there will be dozens of other ideas that prove to be lessvaluable’’ [22]. This may be explained by Patterson: ‘‘Translating amarket opportunity into a new product requires perhaps 15%invention. The remaining 85% of the work involves previouslylearned processes that often are undocumented and undisciplined’’[23].

Inventions can be conceptualised practically anywhere: uni-versities, industry, home garages, on serviettes in a restaurant,even the shower for that matter. They spawn from the creativeideas of the inquisitive mind. Innovations, on the other hand,require significantly more supportive structure. In order to bridgethe gap between invention and innovation, considerable knowl-edge, capability, resources and supportive (but not stifling)structure and control are required to facilitate the process.Ineffectual identification and deployment of these requirementsresults in the innovation funnelling paradigm (Fig. 1), where thenumber of ideas successfully commercialised is significantly lowerthan the number of original ideas [24].

This presents further evidence of innovation being charac-terised by a process (and associated activities) that is necessary tobridge the invention-to-innovation gap. By definition, a processrequires time, resources, capabilities, knowledge, structure andcontrol to be executed and to ensure the desired output. Further,this process may be represented as a lifecycle of phases that, at ahigh level, describes the activities of the process.

1.4. Quality of the innovation process

Based on the postulate that quality and innovation are inter-related in complex ways [10], this paper proposes focusing onthe quality of the innovation process as a means of not onlyunderstanding how these paradigms are interrelated, but empha-sising how quality performs a fundamental role within theinnovation process.

Mentioned previously was the requirement for supportivestructure and control within the innovation process. This was seenas fundamental to ensure that the ‘‘inventions’’ conceived withinan organisation reach a point of development that renders themcommercially successful, and in so doing, become an innovation.

Fig. 1. The innovation funnelling paradigm [24].

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This paper proposes using a roadmapping methodology toprovide the structure described above and Quality Gates to pro-vide the control necessary to ensure that an organisation’sinnovation process delivers the desired innovative output. Thus,it is postulated that the integration of Quality Gates into theroadmapping methodology can provide the necessary structureand control to ensure repeatable organisational innovation,without being overly restrictive and stifling the required creativity.

2. Roadmapping

Tidd et al.’s view innovation as a process needs to be managed[25]. As mentioned previously, this implies the following require-ments: knowledge, capability, resources and supportive (but notstifling) structure and control. This paper proposes that roadmapsand a roadmapping methodology in general, provide the requiredsupportive structure for the innovation process.

Basically, roadmaps are guiding structures that facilitate theexecution of a set of pre-defined high-level activities that havebeen deemed necessary to achieve specific objectives. According toDu Preez et al., a roadmap is defined as a layout of descriptive pathsthat multidisciplinary teams can use as a guiding framework forcollaborative efforts towards a common goal. The roadmaptherefore offers a mechanism to represent project paths, lifecyclesand processes [26–29].

Du Preez et al. describe roadmaps as consisting of beacons orwaypoints that describe the ‘‘where’’ to go, ‘‘how’’ to get there, andthe ‘‘what’’ in terms of specific targets and/or objectives. Accordingto Du Preez et al., ‘‘These beacons or way points should also havecontrols to ensure that the traveller reaches the goals effectivelyand efficiently. All information collected while travelling on theroadmap path or paths should also be collected and managed toensure that the actual trails followed can be backtracked in case heor she gets lost or to make it easier for future travellers’’ [26].

A roadmap should therefore constitute the following [26]:

� A high-level framework consisting of the desired beacons or waypoints.� Objectives indicating what must be achieved to reach the

beacons.� Guidance information stipulating the best practices on how to

reach the beacons and objectives.� Controls that manage the efficiency and effectiveness with which

tasks are executed.� An information repository to collect information while travelling

along a path.

The primary objective of roadmaps within this particularcontext is to provide a guidance framework (or structure) thatassists collaborative teams to focus their efforts within aprescribed set of project constraints, all while maintaining anenvironment conducive to innovation. Furthermore, roadmapsserve as a means of structuring and managing the information andexplicit knowledge generated by the innovation process.

Roadmaps support innovation associated activities in thefollowing manner [26]:

� Planning for innovation – strategically directing and planning forinnovation initiatives. They may be used to map technologydevelopments or market changes on timescales or to develop aMaster Plan for implementing innovation projects. Innovation isdriven by a number of external and internal drivers. It isimportant to align a sustainable plan for execution with thesedrivers. Roadmapping can be extensively used for this alignmentand common understanding.

� Implementing innovation – providing the structure to efficientlyguide innovation implementation.� Knowledge management – the structure being a guide for

capturing, categorising, storing and finding information incontext.� Lifecycles – managing the life cycle of an entity such as an

enterprise, product, technology, etc. (i.e. the subject of theinnovation initiative).

For the sake of practicality, this paper looks at two specificinstances of the abovementioned roadmaps. They are genericEnterprise and Product Lifecycles that have been implemented in acollaborative, interactive and web-based platform that containsthe necessary components and functionalities to build a structuredroadmap. The roadmaps guide a collaborating project teamthrough the lifecycle of an innovation initiative (of an enterpriseor product nature), while managing the information and data, andsharing the knowledge and experience generated through theprocess.

The objectives of the Enterprise and Product Life Cycleroadmaps are to:

� guide project teams through project execution;� facilitate communication;� provide a common planning and execution platform;� assist with planning for and deployment of resources;� facilitate collaboration and utilisation of common resources;� capture information in context;� support the development and execution of best practices;� show the progress of the project.

Essentially, the roadmaps provide guidance and structure toproject execution, whilst still allowing for the generation andmanipulation of project information in an environment that doesnot stifle the creativity of the project team, thereby supporting andexpediting the innovation process.

3. Quality Gate approach

Quality Gate (QG), sourced from Quality Controlling, representsthe second method proposed to support the innovation process.The Quality Gate methodology is based on Cooper and Kleinsch-midt’s stage-gate approach developed at the end of the 1980s. Theapproached was developed based on surveys conducted on successfactors within the innovation process [30–32]. Basically, the gatesare examinations of a composition of pre-defined quality criteriawhich must be fulfilled to continue from one project stage to thenext [33,34]. Quality Gates ensure increased focus through phase-specific checklists, minimise project risk, ensure direct feedbackfrom the process (and the quality of execution) to the currentproject/product stage, reduce the development time by ‘‘doing itright the first time’’, and ensure a project/product that meetscustomer requirements [35,36,33]. ‘‘Each gate represents thereview point for the previous stage, a point where decisions aremade based on the information generated in the previous group ofactivities’’ [[37],p. 290]. Necessary requirements for the successfulutilisation and execution of Quality Gates include: the definition ofgoal agreements, specific plans to ensure the fulfilment of goals, aprogress control plan and the execution of pre-reviews (in whichthe fulfilment of objectives is evaluated) [35,38,34].

Quality Gates are result-oriented points of evaluation withindevelopment and business processes. Controlling the fulfilment ofpre-defined goals promotes communication between the customerand the supplier. This communication supports the fulfilment of

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objectives in alignment with Total Quality Management principles.Therefore, Quality Gates represent points of communication atwhich the expectations of the customer can be aligned with (and ifnecessary adjusted to) the capabilities of the supplier [39]. QualityGates thereby offer relevant advantages for both the customerand the supplier. While the customer can protect its own processesagainst the failure of the supplier process, suppliers have theopportunity to accurately coordinate their processes with the requi-rements of the customer. This presents the opportunity of earlyintervention in the development and/or business processes, avoid-ing the negative effects of errors, changing requirements andcommunication problems between the customer and the supplierlater on in the process. For the configuration of Quality Gates,McKinsey & Company [40] has defined four best-practice elements:

� correct positioning within the development process;� an end-to-end quality gate architecture;� a quantitative/qualitative evaluation system;� the definition of internal customer/supplier interfaces.

A customised and standardised Quality Gate procedure(including the ‘‘where’’ and ‘‘how’’ to execute) based on thespecific requirements of the organisation, ensures the company-wide acceptance, utilisation and continuous improvement thereof.At any specific Quality Gate, a decision (Fig. 2) is made as towhether the project will proceed to the next stage. Using a trafficlight system as a metaphor, the project committee decideswhether the project status is ‘‘green’’, ‘‘yellow’’ or ‘‘red’’. Greenmeans that the gate was successfully passed. With a yellow or redallocation, the continuation of the project must be discussed basedon the extent to which the goals have not been met and what isrequired to resolve those unfulfilled goals. Yellow represents aconditional-go in which case the project may continue subject tothe fulfilment of certain requirements at the next review, while redrepresents a halt to the project until certain requirements havebeen met.

Finally, Quality Gates create transparency with respect toproject progress and the status thereof, enable early problemidentification and resolution with short feedback loops and tightcontrol, allow synchronisation of all activities within the functionalareas, and ensure prompt involvement of top management inimportant design decisions.

4. Integration of methodologies for improved innovation

It is postulated that the integration of Quality Gates into theEnterprise and Product Lifecycle Roadmaps can facilitate theinnovation process by

� selecting the correct location of the gates,� selecting and evaluating the correct criteria at each gate and,� applying appropriate rules to gate decisions,� to support creativity and enhance speed, while improving quality

and minimising rework.

To achieve the objectives of the project, the lifecycles wereanalysed and separated into their respective phases with theassociated activities represented in parallel and/or series to oneanother (Fig. 3). This analysis, in combination with knowledgefrom previous projects and expert interviews, was used to identifythe critical synchronisation (or review) points. Certain reviewswere then upgraded to Quality Gates based on the nature of thephase transition, i.e. requiring executive approval. Basically,Quality Gates are review meetings with a ‘‘go’’ or ‘‘no-go’’ decisionbeing made before commencement of the next phase. Thedifferentiation between Reviews and Quality Gates in this projectendeavours to reduce the number of Quality Gates, therebyminimising the costs and project delays associated with unne-cessary gates (i.e. only including gates were decisions are critical toproject success). The Reviews and Quality Gates consist of genericchecklists with goals, measures, target values, and action plansdeveloped by the project team based on the project’s scope andobjectives.

The Quality Gates diagram (Fig. 4) demonstrates that theapproach consists of more than just the gate meetings in which adecision is made. The approach also includes a planning processthat is executed in parallel with the project lifecycle. The QualityGate process, when integrated into a generic lifecycle phase(Fig. 4), begins with a launch phase in which the goals, measures,target values and action plans are defined. The preview phase,executed in parallel with the project phases, contains one or morepreview points that may be used to adjust the pre-defined targetsbased on the project’s progress. These previews allow for earlycorrective measures to be taken if so required. The previewphase ends with a readiness check with the purpose of evaluating

Fig. 2. Decision process at Quality Gate [[36], p. 1545].

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whether all requirements for the Quality Gate meeting have beenfulfilled. This check evaluates the quality of the planning andavoids wasting limited time, financial, and management resources.The Quality Gate meeting is the last step in the Quality Gateprocess, with the associated decision logic being shown in Fig. 2.The Quality Gate meeting in any particular phase also forms thestart of the subsequent phase, i.e., the meeting represents thedecision point for one lifecycle phase and the launch of the nextphase.

Based on the integration of the two methodologies describedabove, the Quality Gates (and reviews) are assimilated with thelifecycle roadmaps within the roadmapping software platform

(Fig. 5). This enhances the utilisation of the lifecycle roadmaps byintegrating quality control aspects into these design lifecycles.

The roadmaps’ objectives are to guide a team through theexecution of innovation projects (i.e. the innovation process)particularly relating to products and the enterprise itself. Theyendeavour to provide the necessary structure and control (asdescribed in Section 1.4) to ensure the success of the innovationprojects. Furthermore, they manage the information and data, andshare the knowledge and experience generated by the process. Thecollaborative platform utilised facilitates the development, struc-turing and storing of project and enterprise specific information,which can be reused by other project teams in similar projects at

Fig. 3. Enterprise lifecycle with reviews and Quality Gates.

Fig. 4. Quality Gate process parallel with lifecycle execution (example).

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a later stage. This enables improved management and reuse ofexisting information and knowledge and avoids duplication ofwork, thereby enhancing the speed and reducing the cost of theinnovation process.

To prevent bureaucracy and unnecessary formalism withininnovation projects, the extent to which the Quality Gates areutilised within a particular project can be based upon the riskassociated with the project. Consider for example developmentprojects with new technologies and high development budgetswhich are generally considered high risk. In such a case, thecomplete lifecycle with full utilisation of the Quality Gates wouldbe acceptable. On the other hand, a project to customise a standardservice or product requires only part of the lifecycle and QualityGate criteria specified. To support the systematic evaluation ofproject risk and ensure the appropriate utilisation and evaluationof gate criteria a risk assessment approach has been embeddedwithin the methodology and software platform.

5. Extent of Quality Gate utilisation based on project riskassessment

The selection of gate criteria for evaluation and the decisionprocess rules at each QG-meeting are based on a risk assessmentthat determines the project associated risks early in the processand before the QG-meeting. The risk assessment is an integral partof the process and is updated during project execution.

Decision-making activities throughout the innovation processare affected by a variety of different factors. They can be charac-terised as uncertainty, a lack of empirical evidence, dynamics of theenvironment, degree of project complexity, and project disconti-nuities. As such, various risk-related factors develop within the

innovation process that could potentially endanger a project’soutcome [42].

These risk-related factors apply to any kind of product in anyindustry, e.g. foods, pharmaceuticals, machinery or energy. Anadditional component to consider is the enterprise’s interactionwith the environment in which it operates. To consider the riskassociated with negatively impacting the environment, one needsto take an objective perspective, i.e., consider the views of allstakeholders that could be influenced by such negative impact.Failing to consider these perspectives could result in a negativeperception from both the stakeholders, and the public in general,towards the product or service, company and possibly even theindustry.

Further motivation for the early identification of risk relates toproduct liability and the fact that the burden of proving (ordisproving) liability is the responsibility of the company (where inthe past it was the responsibility of the consumer). Although thismay increase the risk of being found liable for defects (and theassociated consequences), the implementation of quality manage-ment systems that are certified and adhere to specific standards,such as DIN EN ISO 9001:2000, in combination with the earlyidentification of risk and the mitigation thereof, reduces the chanceof being found liable for such circumstances.

Therefore, it is crucial to consider the risks during planning andessential to implement an appropriate risk management plan. Toeffectively fulfil this requirement, the potential risks must beidentified, evaluated, reduced and, if possible, eliminated [43].

Various techniques and methods are available for identifyingrisks. Basic techniques for R&D projects include interviews, check-lists, market and competition analyses, and the SWOT analysis. Theyare used in projects with both high and low potential risks [44].The projects, the core processes, support processes as well as the

Fig. 5. Roadmap software platform [41].

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organisational processes, form the subject of the identificationactivity. Types of risk including: external, cost-based, financial, aswell as Corporate Governance may also be the subject of theidentification activity [45]. Depending on the severity of therecognised risk-related factors, different considerations are neces-sary to minimise the potential damage that may arise as a result of arisk being realised [42].

Based on the identified risk level, the Quality Gate criteria to beevaluated and the decision-making rules at the QG-meeting will beselected. By selecting these Quality Gate aspects appropriately(based on the assessed risk), hindering the teams creativity and theproject’s progress may be brought to a minimum.

6. Summary

This paper proposes using a roadmapping methodology toprovide the structure and Quality Gates to provide the control thatan organisation’s innovation process requires to deliver consistentinnovative output. Thus, it is postulated that the integration ofthese two approaches can provide the required structure andcontrol to ensure repeatable organisational innovation, withoutbeing overly restrictive and stifling the creativity necessary forinnovation. In so doing, the paper describes how the quality of theinnovation process may be improved so that it becomes a morerepeatable exercise and innovative output an almost standardoccurrence.

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