henkels stage-gate process (portugal division) nyu, new products & services development march 25...

Henkel’s Stage-Gate Process (Portugal Division)

NYU, New Products & Services DevelopmentMarch 25th, 2006

MCM

Henkelis a leader with

brands and technologiesthat make people's lives

easier, better and more beautiful.

Henkel’s Vision

Quality with Brands & Technologies

HomeCare

Adhesives, Sealants& Surface Treatment

Consumer

Personal Care

Industry

Three Areas of Competence

We do not develop new products

But...

We are able to launch in Portugal NEW brands or products that the

company owns.

Henkel in Portugal

The Stage-Gate Process

PostLaunch Review

Discovery

Stage 1

Scoping

Stage 2

Building theBusiness Case

Stage 3

Testing

Stage 4

Launch

Gate1

Idea Screen

Go / Kill

Gate2

SecondScreen

Go / Kill

Gate3

Third Screen

Go / Kill

Gate4

Forth Screen

Go / Kill

Discovery / IdeationPre-work designed to discover and uncover

opportunities and generate ideas

• Promote internal campaign for ideas • Create a “bank Idea” • Assign a team member to manage• Ideas generated

Gate 1 – Idea ScreenGo/Kill decision point

This gate is a “gentle screen” and amounts to subjecting the project to a handful of key “must-meet” and “should-meet” criteria.

• Is the idea aligned with the company’s mission, goals and strategy?• Is the market attractive?• Does the idea offer competitive advantage over competitors?• Is the idea part of the product portfolio of the company?• Does the company have expertise to manufacture the product

(technical feasibility)?• Does the product fit with company’s policies?• Are there any killer variable (environment issue / legislative action)?

Discovery• Bank idea (Ideas Generation) - The Product Manager manages the group

Gate1

Idea Screen- PM & Marketing Manager

Go / Kill


Stage 1 - ScoopingA quick, preliminary investigation of the projects – largely desk

research

• Preliminary market assessment to determine market size, market potential and market acceptance.

– Internet search, library search, internal reports, customers, focus groups

• Preliminary technical assessment to establish product objectives & feasibility

– Quick and preliminary in/house appraisal of the proposed product

• Preliminary business & financial assessment to map out strategic & competitive rationale

Gate 2 – Second ScreenGo/Kill decision point

The Idea is reevaluated in the light of the new information obtained in Stage 1.

• Does the product respond to a customer need?• Is the competition moving to the same direction?• Is the company capable of manufacturing the product? • When would be the payback period?


Gate1


Go / Kill

ScopingPreliminaryAssessment:• Market• Technical• FinancialFor the 3 “winners”

Stage 1

SecondScreen- MKT Manager & Country Manager

Go / Kill

Gate2


Stage 2 – Building the Business CaseA much more detailed investigation involving primary research –

both market an technical – leading to a business case, including product and project definition, project justification and a project plan. It is the “critical homework stage”!

• Define the “winning” new product (concept and positioning):

- Target market

- Benefits

- Desired features, attributes, requirements and especifications• Competitive Analysis

- Determine strength and weakeness • Detailed Technical Appraisal

- Manufacturability / cost to manufacture

- Detailed legal, patent, and regulatory assessment.

- Investment review• Business and financial analysis

Gate 3 – Third ScreenGo/Kill decision point

This is the last point at which the project can be killed before entering heavy spending. Here the full project team is design and it must be headed by a leader with authority!

• Is the marketing still attractive to justify the investment?• Can the customer’s inputs be translated into technically and

economically feasible solution?• Is the company responding to a competitor’s weakness?



Gate1


Go / Kill


Go / Kill

Stage 1 Gate2

Building theBusiness CaseDetailed Investigation forthe “winner idea”

Stage 2

Third Screen- Country Manager & Intl. SBU Manager

Go / Kill

Gate3


Stage 3 – Testing and ValidationTests or trials in the market-place, lab, and plant to verify and

validate the proposed new produxt and its marketing and production/operations

• Carry out an extensive validation of the entire project• Implement in-house product tests• User or field trials of the product• Trial, limited, or pilot production• Pretest market, test market or trial sell• Reviewed business and financial analysis

Gate 4 – Forth ScreenGo/Kill decision point

This final gates open the door to full commercialization – market launch and full production or operations start-up. It is the final point at which the project can still be killed.

• Was the testing & validation activities properly executed?• Were the results from the Testing and validation satisfactory?• Were required improvements implemented in the product?• Is the expected financial return according to the plan?• Are the operations and marketing plans reviewed and approved

for implementation?

TestingTest the product in 1 supermarket chain for 1 month




Gate1


Go / Kill


Go / Kill


Go / Kill

Stage 1 Gate2

Stage 2 Gate3

Stage 3

Forth Screen- MKT Manager & Sales Manager

Go / Kill

Gate4


Stage 4 – LaunchCommercialization – beginning of full operations

or production, marketing, and selling

• Implement of the marketing launch plan and the production or operations plan

Post Launch Review

• Review product launch performance• Market acceptance

• Ability to support technical product

• Market trends

• Finances

• Revise financial review with updated information

- Review sales & profits• Review strengths & weakness

- Identify successful actions

- Identify mistakes/unsuccessful actions• Evaluate what changes (lessons learned) need to be made for future

launches• Evaluate whether launched met criteria and fulfilled mission, goals &

strategy of corporation & department

PostLaunch Review





Launch

Gate1


Go / Kill


Go / Kill


Go / Kill Go / Kill

Stage 1 Gate2

Stage 2 Gate3

Stage 3 Gate4

Stage 4



Conclusions:

The Stage-Gate is a plan that focuses on quality of execution, builds in the up-front homework, is strongly market-oriented and is backed by appropriate resources

This model brings discipline to the new product process It is relatively simple and easy to understand and communicate. The process provides a road map to facilitate the project and it defines the project leader’s objectives and

tasks (include senior executives from the beginning) Increase investment as risk decreases Check acceptance with customer during the whole process It gives you the opportunity to “Win by a nose!”

New Product and Services Development

PostLaunch Review





Launch

Gate1


Go / Kill


Go / Kill


Go / Kill Go / Kill

Stage 1 Gate2

Stage 2 Gate3

Stage 3 Gate4

Stage 4


Stage 3 – DevelopmentThe actual detailed design and development of the new

product, and the design of the operations or productuction process

• Product development in parallel with corporate marketing & technical product development

- Rapid prototype, working model, or first prototype are taking to the customer for feedback / assess.

- Continue market analysis

- Map out a market launch plan involving corporate marketing and technical area.

• Undertake lab tests, in-house tests and alpha tests• Revise financial analysis with update information• Assess legal issues (approval patents, regulations)

Gate 4 – Forth ScreenGo/Kill decision point

• Is the developed product consistent with the original quality definition specified at Gate 3?

• Does the product continue to be attractive to the market?

• Is the product ready to move forward to Testing? • Are revised financials still with Budget?• Are the marketing and operation plans reviewed for

probable future execution?

ANNEXES - The Stage-Gate Process: The Development Stage

henkels stage-gate process (portugal division) nyu, new products & services development march 25...

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