Senior Managers' Role
in New-Product Development

by Philip A. Himmelfarb, Ph.D.

Senior managers must support and encourage
product-development teams in all their efforts.

New products are the lifeblood of any modern company, whether it is a manufacturer or a service provider. Quality new products don't just happen because a company sets up cross-functional teams. There's more to product development than that.

Senior management plays an enormously important role in the new-product development activities of any company. Good product development depends on a well-orchestrated and cooperative interplay between senior managers and cross-functional teams. Each group acts within the framework of a well-constructed product-development process in which the respective roles are clearly defined and articulated.

Here are some of the major steps that senior managers can take to promote fast and effective new-product development:

Communicate the company's vision

Senior managers need to oversee and guide the preparation of a strategic plan for the business in general and specifically for new-product development, making certain that the visions are communicated throughout the company. Without a detailed understanding of where the company is headed and how it intends to get there, it's difficult for people to come up with ideas. On the other hand, providing a clear understanding of the company's goals makes it easier for the team to develop products that address the needs of the company and its customers.

Define the product-development process

Successful product development doesn't just happen by chance. The flow of an idea as it moves through the development process, from conception and evaluation to final testing and product introduction, must be well-thought-out. Each participant's role must be clarified. Ideally, the process will be depicted as a flowchart, a graphical representation of the company's product-development process, accompanied by formalized control documentation and procedures.

Whatever process is defined, it should be easy to understand and implement. An overly complicated process with too many checkpoints will only impede and minimize empowerment of the development teams. Senior management also must continue to monitor and improve the development process.

Preach the importance of speed

Senior managers must ensure that everyone in the company understands the message that getting new products to the marketplace quickly is essential for the company's well-being and long-term survival. However, as many companies have discovered, speed is important only if it helps confer a significant competitive advantage to the company. Otherwise, concentrating on speed for its own sake may only lock the company into feverishly developing more and more products, faster and faster, with less yield and less relevance to the marketplace.

No matter how quickly it has been developed, any new product must:
Meet or exceed customer requirements
Be readily manufacturable
Have favorably perceived value
Generate good profit margins
Be reliable
Be introduced at the right time

Identify and overcome barriers
to fast product development

Barriers are inevitable when embarking on the path of fast new-product development. A few of these barriers are:
Poor project plans
Conflicts between functional areas
Inadequate time to do the work
Failure to freeze product features
Poor middle-management commitment
Priorities not well-defined
Too many projects for the available resources

Senior managers should identify these and other barriers to effective product development in their companies and take action to remove them as quickly as possible.

Create cross-functional teams for projects of strategic importance

Cross-functional teams for major projects make fast product development possible. They are made up of people from all the key functional areas from which contribution is necessary for project success. All team members will be involved from the start, and the quality of their work is based upon a clear project plan approved by senior management. Ideally, senior management selects the team members, and team members select their own leader. Key suppliers and customers are often development team members.

Empower teams

Empowerment means teams have authority and resources to meet their objectives without fear of retribution if something goes wrong. It is the energizing force that enables teams to go forward with enthusiasm and self-directed drive.

A team without power is not really a team; it's just a collection of frustrated people who get together periodically. Teams must be allowed to make critical decisions and must have adequate resources and incentives. It's up to senior management to sponsor the teams, grant them the authority to make decisions and draw upon company resources when needed.

Team members must also utilize the power once they get it. Allowing team members the power to develop and implement an idea as they see fit promotes accountability in decision making. With an explicit project plan in place, successful results will follow.

Manage the project portfolio

Senior managers must clearly delineate the criteria used to select development projects. Once they establish these criteria, they must prioritize projects in order of strategic importance to the company. The number of projects must not exceed available resources. Management needs to recognize the value of doing few projects at a time very well rather than many projects with mediocre or poor results.

Senior managers also need to ensure that there are enough projects in the portfolio that will have a major impact on the company's future revenues. A project portfolio that primarily contains line extension or maintenance of line projects will not serve the company well in the long run.

Freeze product features early

Product features are a listing of attributes and benefits as perceived by the customer and/or the end user. Product features must be locked in as early in the development cycle as possible.

The problem, however, is that many projects fail or finish late because the new product's features are not frozen early enough or are not kept frozen. The project end point remains a moving target, and the new product probably will get to the marketplace late, if it gets there at all.

Ideally, product features will be locked in as soon as the team has adequately identified customer needs. Once identified, product features must be kept frozen. Suggestions for additional features can be used later for line extensions, product modifications and margin increases.

Nurture creativity

Creativity is essential for good product development, yet it is an unpredictable, vague and somewhat obscure process. It can result in an idea for a new product or a new way of doing something that is original, innovative and significant. It is an intuitive way in which a person rearranges vague ideas and observations, and constructs a new reality, a new viewpoint.

Some guidelines for establishing an environment conducive to creativity and innovation are:
Encourage calculated risk and tolerate failure.
Encourage people to talk to each other and exchange ideas.
Minimize competitive turf issues and interfunctional squabbles.
Recognize that creative people tend to be different from most other people and tolerate their idiosyncrasies.
Provide fast evaluation and feedback of ideas when they are submitted.
Be willing to consider partially thought-out ideas, and give people time to develop them further. Maintain an openness to creative ideas from outsiders, recognizing that not everything must be invented internally.

Minimize bureaucracy

Time and time again, development teams have trouble getting started or operating because so many rules and regulations must be satisfied before anything constructive can happen. Senior managers should be sensitive to the fact that excessive bureaucracy runs counter to fast product development. They should examine the amount of red tape in the company and simplify things for the development teams as much as possible.

Identify marketplace needs

Many senior executives downplay their obligation to help identify marketplace needs, relying solely on their marketing people to do this. This can be a big mistake because identifying marketplace needs is an important prelude to developing new products. It is too important to leave to any one functional area or to chance. In this regard, senior managers can set an example by getting out into the marketplace, talking to customers and ensuring that other key players within the company do the same. This guarantees that the company learns from customers and dealers, analyzes marketplace trends, identifies problems with current products and talks with suppliers.

Senior managers should also encourage technical people to spend time in the marketplace talking to customers. If technical people remain isolated, they will be unable to contribute ideas that meet marketplace needs.

Provide resources

Without adequate resources, development teams will not succeed. Teams need to be provided with a number of fundamental resources, including funding, training, computers and software, laboratory equipment, market research and materials.

Champion major projects

Every major project needs a project champion. Specifically, the champion is a senior manager who provides the team with mentoring and support, and helps keep the project on track. The champion acts as a liaison and is kept informed about the project's status. In turn, the project champion informs the team of changes in company policy or direction that might affect the project.

The champion provides an avenue for other management to inquire about team progress and make suggestions as appropriate.

Everyone plays a role

In companies dedicated to fast product development, middle managers also play an important role in promoting the product-development process. They can work with their employees who are on development teams by providing knowledge and experience, overcoming roadblocks, providing resources, coaching and training, and helping to resolve conflict.

Senior managers must make sure that there is a long-term horizon for new products, that there are adequate resources, that risk and failure are made acceptable and that there is an emphasis on fast design and manufacture of high-quality and readily manufacturable products that meet customer needs. Above all else, senior managers must be staunch advocates of their fast product-development process and highly visible supporters of their development teams.

About the author

Philip A. Himmelfarb, Ph.D., is president and founder of Philip Adam & Associates, a Milwaukee-based consulting firm specializing in the evaluation, fine-tuning and strategic planning of new-product development, the presentation of in-house training seminars and the facilitating of start-up and ongoing development projects.

Himmelfarb has had more than 30 years of successful consulting and hands-on managerial experience in the creation and management of new-product development projects for many corporations. His clients have developed and introduced a wide array of successful new products.