Product Life Cycles Only Work At High Speed

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plcKeanu Reeves isn’t the only one who feels like he’s on a runaway bus. Just ask anyone who works in product development these days. It’s all about speed. And it can be as much of a cliffhanger as last summer’s action thriller. Drop below optimum development speed and you’re toast. Drive too fast and you’ll crash and burn anyway. “Sometimes it feels a little out of control,” says Ted Johnson, a founder of Shapeware, which has been breathlessly cranking out new releases for multiple operating systems. “How much can we do in six or seven months?” he frets.

Johnson has plenty of company. Getting new products to market faster than the competition has always been a business basic. But it’s never been more crucial than now. Life cycles are shorter, and shrinking all the time. Getting to market two months late when a life cycle was four years was one thing. “But when you lose two months out of a nine-month cycle you’re really in trouble,” says James Bartlett, worldwide mobile product line executive for the IBM PC Co. Even worse: rushing it out the door only to fi nd your product won’t fly. Nearly one of every five R&D dollars is wasted like that, says Michael McGrath, founding director of Pittiglio Rabin Todd & McGrath, a Boston technology consulting firm.

Today’s business environment makes it all the harder. Competition is fiercer, consumer expectations higher. Corporate downsizing and unrelenting margin pressures are eating away at R&D and market-research budgets at the same time everyone is rushing to market. “It’s like going into a wind tunnel, throwing the pieces of a jigsaw puzzle into the air, and expecting them to fall into place,” marvels Rob Howe, vice president of worldwide PC marketing for AT&T Global Information Solutions.

But it isn’t hopeless. Getting to market on time and on the money doesn’t have to be a hair’s-breadth escape from disaster. To win, you have to simultaneously manage short- and long-term development cycles, learn cutting-edge engineering techniques, and build integrated design teams. It’s a business process your company can master.

You might think that CAD and CAM are old stories, but peek over the shoulder of a top-flight engineer to glimpse the cutting edge. Rand Peterson is an engineer with the Stratos Product Development Group, in Seattle, which created, among other things, the Microsoft ball-point mouse (see Close Up, Page A/1). He uses Alias Research Inc.’s Studio, the same surface-modeling package that brought dinosaurs to life in “Jurassic Park.” It takes more than a mouse click, but when Peterson is done he’s got a photolik e image detailed enough to show how reflective the surface of a product will be. “We can design surfaces with much more complex shapes, and do it faster,” he says.

Another important advance: direct-to-tool manufacturing. CAD databases can now go straight to the tool cutter; no more time-consuming conversions. Apple reduced the typical 14-week tool-making period to about eight weeks using this procedure, says Bill Burnett, an Apple PowerBook project leader. “But the big savings is in having really accurate parts,” he adds.

Cutting-edge tools that get you to market faster aren’t limited to the workstation, though. Smart companies are developing new relationships with suppliers and manufacturing partners, says Tom Kelley, vice president of IDEO Product Development, in Palo Alto, Calif. Smith Corona saved three weeks in the development of its electronic label printer by involving a molding contractor in the design process–and getting an early cost estimate. Instead of waiting to go to bid, Smith Corona sent the CAD drawings to the molder the day they were finished.

Everyone tells you to listen to the customer. But rapidly changing technology makes that voice harder than ever to hear. “Customers don’t know what they want if it doesn’t exist yet,” says IBM’s Bartlett. But IBM listened to customers talk about what they need. No one told IBM they wanted an expanding keyboard that was larger than the PC case. They didn’t have to. IBM heard them say they needed a smaller, lighter machine with a full-sized keyboard. Result: The Butterfly, the hit iteration of IBM’s ThinkPad

The game really gets tough when marketing and technology are out of sync. “Version 1 isn’t even out when I’ve got to start picking features for Version 2,” says Joanna Vaughn, a strategic marketer for Tektronix. “How do I know what people are going to think of technology they haven’t seen?” Waiting for it to leave the lab will never do.

What to do instead? Simulate it. And be as creative as TV Guide On Screen. The media heavyweight is testing interactive services in 100 Chicago homes even though the technology isn’t ready for prime time. It’s simulating video-on-demand by running one movie on multiple channels at staggered start times. Users can, in effect, fast forward, rewind, or pause by changing channels. The channel switcher is disguised as a fast forward/rewind button. Special wiring gives each household access to the 124-channel en vironment that digital TV promises one day. “The only way to test a home product is to get it into the home,” says Larry Miller, vice president of marketing for TV Guide On Screen.

Face it: Some of your ideas aren’t going to work. You need to have a process in place that allows you to cut your losses as early as possible. And that’s not easy, says PTRM’s McGrath: “Most companies that kill a product had the knowledge–or at least the ability to find the knowledge–very early on. But didn’t use it.” One reason: “It’s human nature to only ask questions you want to answer,” says AT&T’s Howe. At AT&T, a product advisory council meets with design teams at regular intervals and forces t hem to answer progressively more difficult questions.

Good product development teams should be small (10 or 12 people, tops), relatively autonomous, and multifunctional. Use your imagination to build a good team. IBM learned that researchers, who are often ignored once their ideas leave the lab, can be great team members. “Adding the researchers let us get the continued benefit of their advice. And because we didn’t just take their baby away, they were motivated to get it born,” says Bartlett.

Working fast means working concurrently. And not just on different phases of the same project. The ultra-fast software cycle means that developers at Shapeware went to work on Version 4 of Visio, which will ship when Windows 95 ships, while still writing code for the Windows 3.1 version that shipped in August. Sound tricky? It was, says Johnson. Here’s how Shapeware managed: It formed a long- and a short-term team. Not surprisingly, the short-term team was larger. “You have to think about getting revenue c oming in as soon as possible,” Johnson notes. At the beginning of the process, the two teams worked in the same code base. But as the Version 3 ship date got closer, the long-term team was “locked out,” and had to create its own source code base. “That’s a bit of a pain, but to hit our ship date we couldn’t let them add any features,” says Johnson. Large developers, like Microsoft, find this process easier. “It takes corporate discipline [for a smaller company] to have people on the payroll not working on t he next release,” Johnson says.

It’s a good thing that writing code can be hastened via parallel development because you can’t save much time on the back end. Beta testing and quality assurance are time-consuming. But buying someone else’s technology can be a cost-effective time-saver. “Buy the check-off items [like spelling checkerers] from somebody else–concentrate your development time on items that differentiate your product,” says Jon Ferrara, executive vice president of Elan Software, a maker of network-ready contact managers in Pacific Palisades, Calif. Dell Computer used to design all of its own motherboards. No longer. After some tweaking, Dell uses Intel motherboards in its Dimension product line. “We save time and money and can focus our scarce engineering resources on other areas,” says Douglas MacGregor, Dell’s vice president for desktops.

But some manufacturers are relearning an old lesson–haste makes waste. “The pace of the market has caused [vendors] to rush products to market that may not be ready,” says Clain Anderson, DEC’s portable product marketing manager. DEC, Compaq, Dell, IBM, and AST have been forced to fix problems with recently released models. One solution: “Move your planning process back. Start the cycle earlier,” says MacGregor. Dell, which plans as much as 36 months in advance, holds regular meetings that include techn ologists, marketers, and key customers.

Regaining control of the runaway bus isn’t easy–and it isn’t cheap. But remember how high the stakes are: “By the time you know your competitor has made a significant leap, it may be too late,” says McGrath. Consultants such as McGrath are making a good living. The reason: Many technology companies still haven’t mastered the process of rapid product development. So it’s not too late to get your own bus up to a manageable speed on the road to a significant–and lasting–competitive advantage.

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