Module 4: Product development and
Quality Management
OBJECTIVES
Gain an understanding, and knowledge of:
– processes for developing a new product
– the importance of product innovation
– the pitfalls in developing new product innovations
– sources of new product ideas
– quality management principles
– quality improvement
ProNet Ethiopia Module 4
1st EDITION March 2014
Module 4: Product development and
Quality Management
• CREATIVITY AND PRODUCT DEVELOPMENT SUCCESS
• THE IMPORTANCE OF INNOVATION
• DEVELOPMENT OF NEW PRODUCTS
• PRODUCT DEVELOPMENT PITFALLS
• PRODUCT DEVELOPMENT PROCESSES
• QUALITY MANAGEMENT CONCEPTS AND PRINCIPLES
• QUALITY MANAGEMENT FRAMEWORKS
• QUALITY MEASUREMENT AND MONITORING
• QUALITY IMPROVEMENT
• ASSIGNMENT
ProNet Ethiopia Module 4
1st EDITION March 2014
Connecting the 9 dots
(with only 4 lines without interruption)
ProNet Ethiopia Module 4
1st EDITION March 2014
Cross the line / think outside the „box“
ProNet Ethiopia Module 4
1st EDITION March 2014
Profit and CASH for new Product
Development
turn over
Modification
Expansion
Market launch
Development
Maturity
Ageing
Time / Phase
Innovation Competitor appears
ProNet Ethiopia Module 4
1st EDITION March 2014
Profit and CASH for new Product
Development
turn over
Modification
Expansion
Market launch
Development
Maturity
Ageing
Competitor appears Time / Phase
Innovation
(sometimes as Imitator)
Profit
Today‘s Profit is the basis for Time / Phase
innovation and new products
Investment
ProNet Ethiopia Module 4
1st EDITION March 2014
Profit
Time / Phase
Investment
Profit
Time / Phase
Investment
Profit
Time / Phase
Investment
ProNet Ethiopia Module 4
1st EDITION March 2014
Innovation & Turnover
Turnover
Target
4. Increase turnover through
new innovations
3. Increase turnover through
innovative projects in progress
2. Increase turnover through
marketing present products
1. Prediction of turnover with
our present product portfolio
and without innovation
Present
time
Past Future
ProNet Ethiopia Module 4
1st EDITION March 2014
Decreasing Product Life Cycles
Product life cycles has shrunk by an average of 400 %
over the past 50 years
Cosmetics
Toys
Tools
Food items Fifty years ago
Today
Pharmaceuticals
0 5 10 15 20 25 30
ProNet Ethiopia Module 4 Life Cycle (years)
1st EDITION March 2014
Scrap Rate of New-Product Projects
For every 7 concepts, one succeeds!
Number of concepts for a new product
For every 4 development projects, One
Screening & one becomes a commercial winner! Successful
7 Evaluation
Product
6 Business
5 Analysis
Development
Testing
4 Commercialization
3
2
1
0 10 20 30 40 50 60 70 80 90 100
Percentage of Project Time
ProNet Ethiopia Module 4
1st EDITION March 2014
Types of NEW PRODUCTS
Keep score! Use these categories to help you define
what counts as new product
High
New product New to the
lines world products
(20%) (10%)
Improvements Additions to
to existing existing pro-
products duct lines
(26%) (26%)
Cost Reposi-
Reductions tionings
Low (11%) (7%)
Low High
Newness to Market
ProNet Ethiopia Module 4
1st EDITION March 2014
PROBLEMS feed other PROBLEMS
(A Downward Spiral)
A LACK OF TOO MANY
RECOURCES PROJECTS
FOR THE LOW
FOR NEW
PRODUCTS LIMITED IMPACT
RESOURCES ON
TOO MANY AVAILABLE Sales
Profits
SMALL, LOW-
IMPACT
PRODUCT
A LACK OF
FOCUS
POOR JOB
DONE ON POOR
POOR CYCLE
PROJECT PROJECTS
TIMES
PRIORITIZATION
KILLS weak market,
PROJECTS studies, poor
NO NEW
PRODUCT
launch,
PROCESS POOR inadequate HIGH
DATA ON testing FAILURE
PROJECTS RATES
NO
ROADMAP
FOR
ProNet Ethiopia Module 4 PROJECTS
1st EDITION March 2014
Causes of new product failure
Inadequate Market Analysis 24%
Product Problems or Defects 16%
Lack of Effective Marketing Effort 14%
Higher Costs than Anticipated 10%
Competitive Strength or Reaction 9%
Poor Timing of Introduction 8%
Technical or Production Problems 6%
Other Causes 13%
0% 10% 20% 30% 40% 50%
Percentage of Companies
ProNet Ethiopia Module 4
1st EDITION March 2014
Stage-gate model
DISCOVERY
DRIVING NEW PRODUCTS TO MARKET
IDEA SCREEN
GATE
1 SECOND GO TO GO TO GO TO
SCREEN DEVELOPMENT TESTING LAUNCH
STAGE 1 GATE STAGE 2 GATE STAGE 3 GATE STAGE 4 GATE STAGE 5
2 3 4 5
SCOPING BUILD DEVELOPMENT TESTING & LAUNCH
BUSINESS CASE VALIDATION
ZAR
€€€
POST-LAUNCH $$
A lot of process models for innovation processes do exist;
The Stage-Gate-Model was originally created by R. Cooper. REVIEW
ProNet Ethiopia Module 4
1st EDITION March 2014
The Laws of Murphy
1. If anything can go wrong, it will.
2. If there is a possibility of several things going wrong,
the one that will cause the most damage will be the first
one to go wrong.
3. If anything just cannot go wrong, it will anyway.
4. If you perceive that there are four possible ways in
which something can go wrong, and circumvent these,
then a fifth way, unprepared for, will promptly develop.
5. Left to themselves, things tend to go from bad to
worse.
6. If everything seems to be going well, you have
obviously overlooked something.
ProNet Ethiopia Module 4
1st EDITION March 2014
Quality Management
Head
Analyse
Quality
Hearth
Attitude
Management
Hand
Behaviour
ProNet Ethiopia Module 4
1st EDITION March 2014
When do we have achieved quality?
We have quality results,
when 3 basic requirements are fulfilled
User Requirements
Function Costs Targets
Working Results
ProNet Ethiopia Module 4
1st EDITION March 2014
When do we have achieved quality?
It is not only the requirements, technical functions, etc.
The people and their teamwork are also very important
Quality of our work
Quality of our Quality of our
products Quality services
Quality of our teamwork
ProNet Ethiopia Module 4
1st EDITION March 2014
QUALITY IMPROVEMENT
VALUE
ADDING
HUMAN
SUPPLIERS
RESOURCES
CUSTOMER PROBLEM
CARE SOLVING
Say what you
do
MANAGEMENT Do what you RECORD
RESPONSIBILITY say KEEPING
Proof it
Improve on it
ProNet Ethiopia Module 4
1st EDITION March 2014
Quality improvement – Cause/Effect analysis
MATERIAL METHOD
lack of pressure
viscosity low wrong/none pressure
cement starvation
specified
wrong viscosity
cement incompatible lack of activation/heat
specified
with soling material wrong/none temperature
specified
material changed
from original poor
sole
under roughed adhesion
superficial (45 % of all
wrong brush speed
customer
complaints!)
lack of pressure
wrong sole pads
hydraulic
used
leak
wrong pressure selected
MANPOWER MACHINERY
ProNet Ethiopia Module 4
1st EDITION March 2014
Quality improvement
1
Act Plan
Act to What do you
standardize want to
or improve accomplish?
4
Check Do
Are you meeting Carry out 2
your plan? your plan
3
ProNet Ethiopia Module 4
1st EDITION March 2014
Quality improvement
Confirm the 4 Establish and 1
improvement - prioritise the
Assessment improvement needs –
and Review the Results being
aimed for
3 Select the 2
Take action – improvement
Deploy the activity – the
new or revised Approaches to
approaches be introduced
or improved
ProNet Ethiopia Module 4
1st EDITION March 2014