Emphasizing Organizational Effectiveness
|
|
| Freedom from
Project Surprises Newsletter - Issue #46 |
February 2009 |
|
|
|
This
past month saw an escalation of unfavorable revenue figures in the
semiconductor industry, many of them reported in the last few weeks.
Businesses have been faced with quick and significant reductions in
demand, forcing reductions in variable costs such as headcount and
operational expenses.
Buried within the variable costs of
product development are the efficiencies of an organization in creating
new product revenue. During extreme cost conscious periods such as this
one, improvements in organizational effectiveness is an area that will
make a noticeable impact on operational costs and is the subject of
this month's newsletter.
Jeff Jorvig, NPD Process Consultant
|
|
News of Interest to NPD Teams
- New service available in facilitating workshops
for
timely and accurate requirements
closure
for a specific project. Requirements closure is one of the top three
sources of negative impact to a projects time line and this targeted
workshop specifically addresses that deficiency. More information can
be found here.
- Announcing availability of a new workshop
titled "IC Design Skills for Project Managers".
This
workshops target audience is Project/Program managers and the
emphasis is on knowledge development to better plan and manage projects
that involve IC design activities.
- Check out this web
based
solution to managing your NPD/NPI process here and be in control of your
development activities.
- Check out our quick
start instant downloads for managing design
projects.
Leadership Quote of the month:
"Motivate
them, train them, care about them, and make winners out of them...we
know that if we treat our employees correctly, they'll treat the
customers right. And when customers are treated right, they'll
come
back."
-- J. Marriott Jr. |
Now is the Time for Emphasis on
Organizational Effectiveness
The
business climate we are facing today is unquestionably a painful one
for the semiconductor industry, as well as most others. Energized by
the cost sensitive nature of this climate, a focus on efficiency
provides the benefit of organizational growth. The growth I am
referring to is best characterized as an improvement in efficiency that
results in financial growth through reduced development costs and
earlier new product revenue.
Organizations that will grow
stronger during this depressed economic period share a common vision
that efficiency of operations carries significant importance. They
believe now more than ever that there is something to be improved upon,
something that could be done different, or a possibility of newly
discovered opportunities for organizational success. This accent on
change for these groups will yield positive results through specific
improvement actions. Growth organizations will be motivated by a
passion to seize this current emphasis on cost reduction as a
motivation for creating a new level of operational effectiveness.
Stronger organizations will evolve from a belief in doing things
differently, that sustainable change is achievable, that the status quo
is just not acceptable. They will take positive steps to jettison the
project execution baggage that has long been accepted and tolerated
through the more prosperous periods.
Organizations that bolster
efficiency during this period share a vision that has no room for waste
in their development processes or their portfolio management. They will
have the right product ready to generate revenue when the demand
floodgates open. An achievement that will be enabled through focused
actions today, during a period when many organizations will fall prey
to an emphasis purely on cost reduction. The winners out of this
downturn will have emphasized NPD efficiency improvements as a
complement to the routine cost reductions.
Prospering organizations during this challenging business period will
display many of the attributes in the figure below.
|
Assessing
NPD
Efficiency
If
you were asked to define the efficiency of your New Product Development
efforts, how might you respond? It's not an easy question to answer and
I am sure the variation of responses would be fairly significant,
depending on which organizational disciplines were queried. Typical
responses cover a broad range of answers that are primarily discussed
in small groups over lunch, in the break room or at happy hour. These
low visibility assessments are typically an emotional take of the
situation, lack specific metrics and rarely lead to action.
Nevertheless,
it is important to be able to present a succinct answer to the
efficiency question. Not as a collection of individual answers but an
organizational answer, one that is quantifiable and actionable. Without
an agreed figure of merit to describe efficiency of NPD efforts it is
impractical to expect anything will change. This is not about blame; it
is about leading an organization down a managed path of change,
culminating in measurable improvements. Accomplishing this requires the
establishment of a baseline that describes current execution
effectiveness. This figure of merit can then be utilized to identify a
new target for efficiency.
This key metric must describe NPD
efficiency by providing a fact-based judgment to define an
organizations effectiveness at producing new product revenue.  Consider
that the primary objective for any project is realized revenue that
meets a specified timing, figure and margin. Revenue is the only
motivation for starting a project, therefor it must figure
substantially into the measurement of success. A
successful project is not a tapeout, first samples, a completed
characterization or production release; it is sales that meet a planned
date, margin and value. Any project success metric that is not
tied to a revenue target is really of little value and may actually
hinder improvements by providing a false passing grade.
Revenue
generation as planned means that a proper market need has been defined
and a product has been produced that fills that need. That's what will
keep the stockholders happy and the paychecks coming. Many times the
metrics are far too short sighted and everyone along the NPD path has
small sub-organizational successes to report, however the big picture
result is missed revenue; and that is unquestionably a failure, pure
and simple. Emphasis on a big picture revenue metric makes everyone
accountable and empowers each individual to challenge project
assumptions. Now the question is this - how has your organization been
doing on enabling project revenue and where deficiencies are noted,
what is the game plan for mitigating them?
|
| How we
can Help
"Providing solutions to the systemic project challenges that
quietly steal early revenue opportunity"
- Organizational
Effectiveness -
We will work with your organization in establishing a higher level of
new product productivity - that is improving time to the revenue target
- the only metric that matters. This is what we do.
- Remove
Execution Barriers -
We can facilitate resolution to specific project execution challenges,
removing them as negative contributors to project performance. Get rid
of the project baggage that is
holding your organization back.
- NPD team one day workshop to improve planning, execution and monitoring skills for
design projects.
- Web based NPD workflow management.
- Ready made downloads:
schedule, checklist, analog design guide.
- Increase management bandwidth via Virtual Design Manager.
- Full listing of common services here.
Contact us today via email, 480-895-0478 or
877-895-0478 |
|
Feedback
To increase the value of this newsletter for you I would like
to hear your comments.
- What do you like or not like about this
newsletter?
- What subjects would you like to see covered in
the future?
- How is the format?
- Ask a question and I will anonymously post and
answer it here in this section.
Please email me here with any questions,
comments or suggestions that will help me better serve my readers. I
would enjoy hearing from you.
|
|
|
