Six Strategies for Successful Product Innovation Transformation
by Jim Mikell, EVP of Global Solutions, Stage-Gate Inc.

As organizations grow, plateaus are reached where different strategies, approaches, processes and infrastructures become requirements for success.  Organic growth is often the key contributor, but expanding global presence, post-merger integration, changed business units or dynamic markets are additional factors.  At these plateaus, leaders start saying “we need new systems to address our new reality”.

A common focus in growth situations is the Product Innovation “system”, including Product Innovation Strategy, Portfolio Management and Stage-Gate® Idea-to-Launch processes.  Approaches which enabled the organization to reach its current state are often insufficient to maintain or accelerate the growth trajectory in the future.  If a formal Product Innovation system in not in place, then one is needed as the foundation for growth going forward.  If there is a reasonably effective Product Innovation system, then scale, complexity or dynamics may be rapidly making existing procedures, tools, roles and resources obsolete.

At times like this, streamlining current processes is no longer a viable option and a full-scale Transformation is required.  Leadership needs to take the organization back to Stage-Gate fundamentals and build or re-build a “new” Product Innovation system that will support the organization of the future.

Realities for transforming a new Product Innovation System

• Re-building product innovation is a significant change to a core process; in fact, it is more complex than many others due to the breadth of cross-functional participation.
• Building a product innovation system requires a full transformation approach: create a strategy, define processes, design structures and tools/technologies, define roles and responsibilities, and implement measures and metrics to manage performance.
• Managing a transformation is a program (multiple, inter-dependent projects) which requires a level of leadership, skills and experience above standard project management.

Our experience has shown that a focus on key strategies can significantly increase the probability of success for New Product Innovation system transformation.  For more information on these and related topics, see the reference paper Successfully Implementing the Stage-Gate^® NPD Process.

Six Key strategies

1. Don’t reinvent the process.
   Regardless of your organization’s nature, Dr. Cooper and Dr. Edgett’s research has shown that fundamentals of successful Product Innovation are virtually identical.  If your Product Innovation system has gaps or inconsistencies relative to Stage-Gate standards, then revisit each element - their importance often increases as organizations grow.  If you do not have a formal Product Innovation system, then leverage proven practices such as those contained in SG Navigator™.  Accelerate your transformation program by focusing your team on customizing or tailoring proven processes, not re-creating them from scratch.
   
   
2. Assign an Executive Sponsor to align the executives.
   Many organizations invest heavily in launching a new product innovation system only to discover that senior management do not attend gate meetings, provide resources, or are even aware of the differences.  An executive champion with energy and respect needs to align their peers to support the new system.  This person needs to wear multiple hats to support the transformation program, and make this effort a priority, otherwise the transformation effort will take significantly longer to complete.
   
   
3. Dedicate a Program Manager to manage the transformation effort.
   Seldom has someone successfully transformed a core business process on a part-time basis.  The program manager is the hub of the transformation effort, obtaining support from the Executive Sponsor, synchronizing plans, resources and activities, and constantly anticipating the next set of roadblocks, challenges and areas of resistance.  Often this person becomes the Process Manager, which means that they can transition into their new role gradually while the build effort declines and balance their focus on transformation versus day-to-day operations to ensure that the product innovation system is working effectively.
   
   
4. Create a tangible, comprehensive change management strategy and plan.
   Change management is often misunderstood and usually considered an elaborate communications plan.  A communications plan is only one of eight elements of a change plan to effect true ‘transformation’.  Change plans need to: assess organizational readiness, articulate the need for change; define components of the unique change strategy; state expected behaviors; define leadership development needs; design the organizational structure; measure alignment of individuals and teams; and, of course, execute a communications plan.  Human Resources and change experts are valuable assets, but Executive Sponsors and Program Managers should anticipate spending half or more of their time driving the change plans.
   
   
5. Assign the necessary talent to support the program from start to finish.
   Do not underestimate the quantity and quality of resources necessary to execute a successful transformation program.  In addition to key participants in the eventual product innovation system, the transformation requires: program management experience, change expertise, technology skills, leadership coaching and product innovation expertise.  Most organizations have some of these skills, but few have all of them – if they did, they would be in the transformation business.  Understand your gaps and address them through assignment of top talent or external options as needed.
   
   
6. Be results-focused and develop a business case
   Leadership’s most common question is: “Is the effort worth the investment?”  Dramatically accelerated or increased product innovation does not occur because the organization decides to utilize a proven system.  Results are achieved because leadership invests appropriately in a solid transformation program.  Determine the level of investment that is needed to achieve your objectives and put it into a business case - the results will accelerate the support needed.  For examples of how to estimate the potential benefits from improving your own product innovation system, see the article Improving Your Idea-to-Launch Process: Is the Effort Really Worth It?

Want help establishing the level of product innovation transformation investment necessary to achieve your specific return on investment objectives?   Call +1-905-304-8797 to speak with a Solutions Consultant or email us at info@stage-gate.com.