From Stage-Gate to Triple-A: A Next-Gen Approach to Launching Products
In the 30 years since Robert G. Cooper introduced Stage-Gate®, it has become the most widely used process for steering product ideas to their launch. Still, the process has its share of critics, as Cooper readily concedes today. In the following article, excerpted from the May-June issue of the CIMS Innovation Management Report, Cooper—who is president of the Product Development Institute and ISBM Distinguished Research Fellow at the Smeal College of Business Administration at Pennsylvania State University— revisits Stage-Gate and how it’s evolving in the labs and offices of a vanguard of innovative companies.
Stage-Gate is accused of being too linear, too rigid and too planned to handle more innovative or dynamic projects. Moreover, it’s not adaptive enough and does not encourage experimentation; and the system is too controlling and bureaucratic. Some authors have refuted these criticisms, noting that most are due to poor implementation, while some deficiencies have been corrected in more recent evolutions of Stage-Gate. Issues do remain, however, so a handful of leading firms are rethinking and re-inventing their idea-to-launch gating systems.
What is emerging is a more agile, vibrant, dynamic, flexible gating process that is leaner, faster and more adaptive. This reborn Stage-Gate is what I call the “Triple A” system.
1) Adaptive and Flexible: Stage-Gate is becoming much more adaptive because today things change all too quickly. While a new-product project starts out based on assumptions about what the customer wants or needs, new customer insights and changing markets midway through suggest new requirements, necessitating changes to the original product concept. The goal of “frozen product specs” is largely obsolete!
Building in adaptivity via spiral development deals with this fluid information dilemma. Spiral development incorporates spirals or iterations designed to validate the product with customers early, cheaply and often. The notion here is that customers can’t say what they want or need until they see it, especially for more innovative products. The goal is to get something in front of the customer—a “protocept,” namely a virtual prototype, crude model or rapid prototype he can see and respond to. In this way, although the product may be less than 50 percent defined when it enters development, it evolves, adapting to new information, as it moves through development and testing.
In the new gating system, the actions within each stage and the deliverables to each gate are unique to each project, based on its context—another indication of flexibility. For example, different types of projects—highly uncertain with many unknowns versus well defined—require different types of stage activities, gate deliverables and criteria for “Go” at gates. This is quite different than the “one size fits all” traditional SOP (standard operating procedure) approach to product development, which prescribes standardized actions, tasks and deliverables for all projects by stage, regardless of project size, risk or project type.
Today, there are fast-track versions of Stage-Gate for lower-risk, smaller projects: Stage-Gate Lite for product modifications and renovations, Stage-Gate XPress for very small changes or single customer requests, and Stage-Gate-TD for technology development projects.
The more advanced and most flexible version of Stage-Gate is totally context-based: the risk-based contingency model. Here, the project team begins each stage of the project with a blank canvass and defines the key risks and assumptions. Next, they map the information required to validate the assumptions or mitigate those risks. This logically leads to a delineation of the important tasks to be done in that stage. The result is that each project is uniquely mapped out—quite the opposite of a standardized process.
2) Agile: The next-generation system also incorporates Agile development methods, developed by the software industry and described in the 2001 book, Manifesto for Agile Software Development. Agile breaks the development process into small increments with minimal planning; these increments, known as “sprints,” are time-boxed, limited to very short time frames, typically two to four weeks. Each sprint begins with a planning meeting where the sprint goals are defined in the form of a sprint backlog; each sprint day begins with a daily stand-up meeting or scrum, where the team discusses what they intend to accomplish that day and what they did the previous day. Sprints do not deliver the usual reports and presentations but instead create a working version of the product, something that can be demonstrated to stakeholders.
While physical products are obviously different than software development, and it may not be possible to deliver a working version of the product in a few weeks, the objective is similar: deliver something that is tangible and can be tested with stakeholders (customers and management). This Agile/Stage-Gate hybrid model has been implemented in a handful of manufacturing firms with dramatically positive results; it may be the most exciting evolution of Stage-Gate in the last three decades.
2) Accelerated: Perhaps the most important improvement in this part of the system is that development projects, especially major projects, are properly resourced and fully staffed by a dedicated cross-functional team for maximum speed to market. This requires integrating Stage-Gate with portfolio management and resource management, ensuring that the number of projects in the pipeline is consistent with the resources available so that project team members are not stretched too thin.
The new gating system is also much leaner, with Lean methods (e.g., Value Stream Analysis) used to remove bureaucracy and unnecessary activities. This is consistent with an important Agile principle: “Simplicity—the art of maximizing the amount of work not done—is essential.”
Firms have applied Lean Six-Sigma, focusing on the product-development value stream (much like in a manufacturing plant), and removed all work that adds no value. Additionally, smart firms have built in a post-launch review that includes financial results as well as the project’s hits and misses so that the next project can be even better. In this way, continuous improvement is built in.
Other ways that the new Stage-Gate system accelerates projects include:
- Concurrency: Activities within stages overlap, and even stages overlap. Indeed, the notion of a “stage,” where certain tasks must be completed before moving to the next stage, is less relevant in this new system.
- Sharpening the fuzzy front-end: More emphasis here means the project is clearly scoped and key unknowns, risks and uncertainties are identified as early as possible. By identifying the risks and determining whether new technology might be required, many problems later in the project can be averted and much time saved.
- IT support: Some leading software suppliers have created IT in support of Stage-Gate, designed to reduce work and accelerate the process. IT tools include managing the project, pre-populating documents, project tracking, resource management, portfolio management, and even idea capture and handling. These are reputed to reduce time or project work by as much as 30 percent.