Katherine Radeka's Product Development Field Notes

Ravelry: A Knowledge Supermarket for Knitters

2010-01-30T08:43:00.000-08:00

If you are wondering what a fully fleshed out Knowledge Supermarket looks like, find someone in your life who knits and head on over to Ravelry: http://www.ravelry.com This began as a social networking site for knitters, but it has become the best example of a public Knowledge Supermarket that I've seen.

(If you don't have any knitters in your life, I pity you - there's nothing more cozy than handknit cashmere socks - but you can create your own account so that you can poke around - and learn to knit your own socks).

Knitting is a technical craft with hundreds of years' worth of accumulated knowledge about stitch patterns, garment construction, fibers and yarns, and repeatable methods for producing intricate colorwork and texture.

Ravelry's developers have grouped all of this knowledge into the categories that will make this knowledge easy to reuse, provided a powerful search engine and data structures that support knowledge creation and reuse. A simple editing process keeps it all accurate. Meanwhile, the community has populated the libraries and made this a hub of links that bring the entire Internet's accumulation of knowledge available to Ravelry's knitters.

Here is one use case to show how powerful this is:

I find an interesting kind of yarn that I've never seen before, and want to know what I can do with it. On Ravelry, chances are that someone else found the yarn first and put in all the information that's important to me as a knitter - things like how many meters there are per ball of it, and how well it wears - and other knitters have linked their projects they made with this yarn. Ravelry makes some pattern suggestions for me, and I select one. If this is a free pattern, I just download it as a PDF and if not, I purchase it right online first.

If I have my iPhone with me, I can do all of this right in the yarn shop so that I can purchase the right amount of yarn and other supplies for the project, without having to make extra trips.

Now I create a project page that links to all of Ravelry's information about the yarn and the pattern, including the mistakes in the printed version of the pattern and how others have corrected them. I can post pictures of my WIP and my finished garment, then add my own comments about the yarn and pattern to share with the next person who uses them.

Meanwhile, if I encounter a new technique in the pattern, a search by the name of the technique pulls up blog posts, online discussions, photographs and even YouTube videos that demonstrate it for me.

There is no need to reinvent anything in a craft that's been perfected over hundreds of years, and having all that knowledge at our fingertips frees up our creativity for exploring how to use these techniques in new ways.

In my next post, I'll share one amazing project that was only possible because this site's libraries and online community pulls all this knowledge together in one place.

In the meantime, imagine if you had something like this for your key product knowledge inside your company? What would you be able to do that you can't do now?

Guest Post on Contrarian Consulting: Lean Solo

2009-11-30T07:04:00.000-08:00

I wrote a guest article last week for Alan Weiss's Contrarian Consulting blog: Lean Solo: Five Reasons Why the Best Solo Consultants Are Inherently Lean.

If you've ever doubted that lean ideas can scale down to a small organization, you should read this article.

Continuous Flow Consulting: Leverage Technology for Just In Time Consulting

2009-11-24T12:34:00.000-08:00

This is the fifth post in a series about moving towards a continuous flow model for providing outside assistance to companies that want to become leaner.

Principle #3 of Continuous Flow Consulting is: "Spend less time in face to face meetings, and do much more over the phone and over the Internet, using the richest media available, on shorter time cycles."

In Lean Manufacturing, one of the big wastes is transportation: the need to ferry raw materials, parts and subassemblies between different parts of a plant to get things done.

In consulting, travel is a huge source of non-value-added time. It costs the consultant hours of productive time, and it directly costs the client money. That doesn't mean that all travel is bad - it does mean that we need to ask ourselves if the travel is worth it.

There are some things that can only be done face to face. In fact, I've blogged before about the unintended side effects of blanket travel restrictions when they occur at critical points in the product development process, and the same thing is true in a consulting engagement.

However, so often we assume that most of the work that we do has to be face to face: that if we're not on the client site, we're not adding maximum value. I would argue the opposite: we can provide more value to more clients if we develop flexible models that blend face-to-face work with continuous access to just-in-time remote coaching.

For example, I cannot be physically in Helsinki, Singapore, Pennsylvania and California on the same day. I can (with some creative scheduling, a good headset and an Internet connection) conduct coaching calls with people in all of these places on the same day. In fact, I can be on-site in California and also give my Finnish, Singaporean, and Philadelphia clients just what they need, when they need it (ironically, this is easier when I'm traveling than when I'm at home).

The technology available today makes this so easy that I don't know why everyone doesn't do it. We can't cover as much in a coaching call as we can in a full day meeting, but it's quality, not quantity that counts. If that call occurs at the right point in time, with just-in-time knowledge sharing, it can have a much greater impact on the success of the project. I'm a lot more likely to hit that moment if I'm talking with my clients on short time cycles.

We used to believe that we needed face-to-face meetings to develop trust - but I'm not sure that was ever as true as it seemed. While face-to-face meetings build relationships between relative strangers, we are more likely to sustain a relationship with a person we talk with by phone once a week than we are with someone that we only see once a month.

Continuous Flow Consulting: Cut Batch Sizes

2009-11-17T10:10:00.000-08:00

This is the fourth post in a series about moving towards a continuous flow model for providing outside assistance to companies that want to become leaner.

What is the "batch size" of a consulting engagement?

I've done 1:1 coaching and I've done large training events. I've even done some events that were so large they had multiple locations connected with video.

Here, as in most places, conventional wisdom says that it's better for both the consultant and the client for these events to be as large as possible: less work to reach the same number of people, everyone hears the same message at the same time, the organization as a whole gets to "kick off" their lean journey at once.

Like most conventional wisdom about batch sizes, these assumptions are wrong.

Large scale events are good at transferring explicit information efficiently. However, as I said in my last post, that's the easy stuff. The hard stuff comes in the day to day slog of making different choices. They are fantastic for rallying the troops, but the inspiration is hard to sustain in the face of the realities on the battlefield.

For that, one needs people on the front lines - leading, managing and mentoring as needed to help people make the right decisions in the moment, ideally cutting batch sizes for knowledge transfer down to one.

What is the role for a consultant in this?

First, I must make it easy for people to get explicit information just-in-time. The Lean Development Resource Center is my start in this direction: every one of my clients receives premium access to the site. Eventually, this will give them access to all the knowledge that I externalize (by writing down my tacit knowledge, making it explicit). They can get it 24-7, on their own, as they need it.

Second, I need to work more collaboratively with the client to bring them into the knowledge transfer process. In the best lean organizations that I've seen, managers lead the trainings rather than professional trainers. My strength is in the content and in the instructional design that helps ensure that the workshop can deliver on the learning objectives, and I can leverage that more effectively by training the managers and then letting them train their people.

The "see one, do one, teach one" model from medical school works well in this context, and helps a large company grow its skills exponentially. A3 Thinking, after all, is not brain surgery.

Although I have more experience with lean, they have more experience with their people When I let go of control and allow them to leverage that into small group experiences, the value of the team interaction and demonstrated leadership makes up for the rough delivery.

Finally, I need to focus my scarce resources to actively teach, support, model and reinforce the kinds of mentoring skills that facilitate that one to one knowledge transfer.

Continuous Flow Lean Consulting: The Trusted Advisor

2009-11-10T11:09:00.000-08:00

This is the third post in a series about moving towards a continuous flow model for providing outside assistance to companies that want to become leaner.

In my last post, I posited a series of principles of continuous flow consulting. Here's #1: Become trusted mentors and advisors, not trainers or analysts.

To understand the role of the trusted advisor vs. the role of a trainer, one needs to know the difference between tacit knowledge and explicit knowledge. Explicit knowledge is written down: training materials, reports, statistics. Tacit knowledge is all the stuff that we gain through hands on experience. One can read everything that's been written about how to climb a mountain, but to master mountaineering, one has to climb mountains, preferably under the tutelage of an experienced climb leader. There's no substitute.

Training is great at delivering explicit knowledge - things like "What is a kanban system?" and "What does PDCA stand for?" Analysis is terrific at making meaning out of explicit data, such as analyzing control charts for improvement opportunities. Event-driven lean is mostly about transferring explicit knowledge about specific tools.

These events are not as good for helping organizations as they adapt lean principles to their own organizations: constructing a kanban system or using PDCA on a daily basis outside of the classroom. There is a tremendous amount of tacit knowledge involved in learning how to use lean principles where they can do the most good, and in building a lean culture of systematic problem-solvers.

Training is still important in the early days of a lean transformation, when there is a tremendous amount of explicit knowledge to transfer, and when workshop exercises can begin the process of building that direct experience that leads to a lean culture. As the newly minted lean company masters the basics, we run out of explicit material pretty quickly, and the need for mentoring quickly takes over.

A mentor guides the mentee through hands-on experiences that go to the source, helps them see the current situation more clearly by asking good questions, and provides advice that is rooted in experience. It is the way we transfer tacit knowledge.

We can only mentor effectively in the context of an on-going relationship that involves more than a visit once a month. We have to be engaged with each other at the moment when the mentee has a need or the mentor has an opportunity to deepen understanding. That takes trust and some time, but less time than holding events that make changes that have no sticking power.

The mastery of tacit knowledge with the help of a trusted advisor is the difference between having a kanban system or a knowledge supermarket and being a lean organization.

Continuous Flow in Lean Consulting Part 2

2009-11-02T08:20:00.000-08:00

In Part 1 of this post, I outlined the problem that I observe: the way we conduct lean consulting reinforces an event-oriented view of lean that leaves a lot of value on the table.

My personal mission is to create the freedom to innovate, by eliminating all the stuff that gets in the way.

In most PD organizations, there is a lot of stuff in the way: big stuff, like rigid phase gate processes, and small stuff, like difficulties retrieving essential information on a daily basis. It all clogs up the flow of innovation.

It takes daily, continuous effort to get all that stuff out of the way. We humans are masters at grooving the things we do every day, even when those things directly impede the flow of our work. It takes effort to change, even when there is immediate benefit. One training event or one goal setting session is not going to create change.

I've never been satisfied with an event-driven model of consulting, and I've attempted to fix it by providing unlimited access via phone and email for all of my clients as a part of every engagement. As a result, at least my clients never feel like they're on a meter with me.

Still, I think that doesn't go far enough. The business model of consulting, as long as it's based upon face to face meetings, trainings and events, is not continuous or just-in-time enough to be as effective as it can be during a lean transformation.

So how do we make consulting services more continuous? Here are six principles for continuous flow consulting:

Become trusted mentors and advisors, not trainers or analysts.

Cut the "batch size" for trainings and other learning experiences.

Spend less time in face to face meetings, and do much more over the phone and over the Internet, using the richest media available, on shorter time cycles.

Provide multiple ways to connect, and lower the barriers to connection.

Provide ways for clients to pull your knowledge when they need it, rather than on a time schedule that's dependent upon the consultant's availability.

Bring clients together to form communities so that they can provide support for each other around their common goals.

Just this week, I took a major step towards building my own continuous flow consulting model.

I launched a Knowledge Supermarket around lean product development. It's called the Lean Development Resource Center, and it's available here: www.leantechnologydevelopment.com

The site will give my clients and other lean product development practitioners the ability to pull knowledge from me when they need it. I have a wealth of materials in my personal library from seven years of lean product development consulting and fifteen years of product development work that does no one any good if it's on my hard drive and in my head.

It's an experiment and as such, I don't know exactly where it's going to end up, but I think this type of thing is a step towards being available for our clients when they need us, and not just when we get on a plane to see them.

Continuous Flow in Lean Consulting, Part 1

2009-11-02T07:52:00.000-08:00

In a lean organization, people at all levels of the organization continually engage in systematic problem-solving so that the company and its people eliminate waste and deliver more value ever day.

This is the Holy Grail of lean thinking - the true source of differentiation between the companies that get great results with lean and the ones that get good results initially but find that they can't sustain their gains. It is a universal and continuous flow of innovation that tackles problems from massive to tiny in a spiral of exponentially increasing value creation.

As lean consultants, our job is to support organizations as they develop this internal capacity. I'm beginning to wonder whether or not the way that we tend to do this is as effective as it could be.

Kaizens, mapping sessions, trainings, etc. are all events. As such, they are discontinuous, limited in the number of people engaged, and conducted mainly on the mid-sized problems that lend themselves to this format. Often, they focus on implementing best practices from other lean companies like 5S, kanbans or set-based concurrent engineering, rather than allowing the workers (machinists, engineers, doctors, executives) solve their problems using their own ingenuity.

We don't want to reinvent solutions, and the tools of lean have a demonstrated track record of delivering performance improvements, but the companies who just implement the tools without instilling systematic problem-solving leave so much value on the table. Yet as consultants, we model exactly the kinds of behavior that lead to unsustainable or shallow tool-driven lean programs that generate only limited value.

Our clients need to develop sustainable, continuous flows of systematic problem-solving to maximize their potential. Yet without living with a client for some time, we need to support them.

There must be a better way. In Part 2 of this post, I'll explore some ways to get more continuous flow into our lean consulting work.

In the meantime, I encourage you to check out my two new web class offerings, Lean Product Development Basics and Lean Thinking for the Front End of Product Development.

Building a Better Mousetrap at AME

2009-10-28T07:54:00.000-07:00

Durward Sobek, Michael Kennedy and I conducted a workshop on lean product development at last week's Association for Manufacturing Excellence conference.

The workshop uses the Mousetrap® game as a product development challenge: can you build a better mousetrap? Here is the "before" picture (Mousetrap 1.0):

The purpose of this workshop is to help people gain more comfort using rapid learning cycles as part of the product development process. The teams develop Mousetrap 2.0, 3.0 and 4.0 in iterative development cycles, use LAMDA to investigate their ideas and A3 reports to document their findings.

The groups are all part of one development team competing for a customer order against a competitor who has set a high bar for performance.

This time, all four teams could only catch 7 mice in five minutes, using three people with the original set up. The "winning" solution, which included ideas from all four teams, caught 23 mice in 5 minutes with only one person, a 10X improvement in mice caught per minute per person.

By sharing the best ideas among the entire group, we end up with at least one solution that will work among the four teams, demonstrating the value of set-based design when the team has a high degree of technical risk and a lot riding on the outcome.

The group used rapid prototyping tools (scissors, masking tape, construction paper) to quickly design and test their ideas in ten minute development cycles, followed by five minute trials.

Special thanks goes to Jamie Flinchbaugh and the Lean Learning Center who originally developed this simulation, and helped me adapt it to product development.

Lunch with Ken Kreafle of Toyota

2009-10-26T09:54:00.000-07:00

I had lunch today with Ken Kreafle, General Manager of Vehicle Production Engineering for Toyota North America, while I was in Northern Kentucky this week. It was a great way to cap off the Association for Manufacturing Excellence’s annual conference.

He defined lean as, among other things, “workers improving their work within their teams.” In other words, lean is not something that someone can do from the outside. Those of us who support lean from the outside can only support the people on the inside as they improve the process.

He strives to remind people that it took sixty years for Toyota to get to the place where it is today (and it’s not perfect by any means). All the “stuff” - 4/5/6S, kanbans, work cells, etc, etc emerged from a process and a culture of relentlessly attacking problems so that they get solved permanently. We can improve our operations and product development by modeling our practices after the tools, but that’s only the tip of the iceberg.

It’s much easier to emulate specific tools and practices than it is to truly empower workers to improve their own work - to give them the tools, set the expectations, manage and reward them so that they come in every day willing and able to solve problems so that the problems don’t come back.

We have it a little easier in product development - after all, we come in to work every day prepared to solve customer problems, and figure out how to meet customer needs more effectively with the next products than we do with our current products.

Still, how many of us have problems that crop up over and over again - always at a time when we don’t have time to do anything more than place another bandaid over them? How many of us stumble at the same places in development over and over because there’s never any time to fix the problems permanently? How many of us spend a lot of energy innovating in areas like checkpoint meetings that add nothing to customer value, sucking time and energy away from the things that drive revenue growth and profitability?

What would we be capable of doing if we rigorously attacked those problems so that we could move on to better problems?

The Future of Publishing: Print on Demand

2009-06-01T05:56:00.000-07:00

I spent the weekend at BEA, networking and doing research for my new book.

On Sunday, I spent quite a bit of time visiting Lightning Source to learn about their printing model. They are the print-on-demand subsidiary of Ingram, the largest book distribution company. If you buy books from Amazon or barnesandnoble.com, your book passed through Ingram on its way to you.

Lightning Source operates plants that have digital presses capable of doing short runs (<1000 copies) at a reasonable price, down to single copies. They service everyone from the major publishers to university presses to self-published authors, helping them all produce only the copies that customers want to buy. Oxford University Press has put its entire backlist (books from earlier years) on Lightning Source, making it possible for them to keep many more books in print than they could when they had to have large print runs.

There are thousands upon thousands of new books released every year, and under the old model, few of them made money. The long print runs required to get the per-unit cost down to a reasonable level created a high barrier to entry and a ton of non-value-added waste, in its most visible forms: books printed and then pulped without ever leaving the publisher’s warehouse, books shipped to the retailer to support a major push, and then shipped back unsold, a huge remainders market for the ones that didn’t sell.

That is a lot of trees and a lot of oil being saved.

For the major publishers, this may not lower their costs all that much - marketing, editing and design still consume a lot of money and energy. An author will still need to produce a book that will justify that investment. But it does lower their risk and give them the ability to maintain much larger backlists, since the electronic files associated with them are essentially free. It replaces one of the most rigid parts of the publishing process with a flow that is much more adaptable: they can print a small number of copies, and if the book takes off like a rocket, they can make more.

That’s good news for everyone, except maybe the pulping plants.

The Importance of Failed Innovation

2009-04-02T13:46:00.000-07:00

Scott Anderson wrote a post today: The Importance of Failed Innovation. He writes,

(O)ne way out of this problem is to increase the innovation success rate. A noble aspiration for sure. But be careful. Following that seemingly sensible path can lead to some perverse behavior.

He's right about that: fear of failure can drive innovation towards the tyranny of incrementalism, where breakthrough ideas get filtered out before they have a chance to prove themselves.

He lists countermeasures like "Lower the cost of experiments," "Change the order of experiments" and "Increase the pace of decision-making."

Of course, a well-designed set-based process that evaluates multiple options to burn down risk accomplishes all three - while also increasing the likelihood of success.

I agree with Scott that innovation needs the freedom to generate lots of ideas that fail. But if you know what your strategic objectives are going in and you evaluate a set of ideas that will meet those objectives at the same time, your likelihood of achieving the results that you desire increase dramatically - which is what we all really care about.

Million Dollar Consultant® Hall of Fame Award

2009-03-20T15:26:00.000-07:00

I'm proud to announce that yesterday, I was inducted into the Million Dollar Consultant® Hall of Fame, the only product development or lean consultant honored to date.

Here is my citation:

Katherine Radeka: An outstanding professional in lean management and business processes, who has created significant intellectual property and become the “go to person” in her field through her highly effective promotion of her value in her marketplace.

The Million Dollar Consultant® Hall of Fame is bestowed by Alan Weiss, the original Million Dollar Consultant® with over thirty years of experience working with top companies such as Merck, GE and Mercedes Benz, and author of more books on the consulting profession than any other person. The New York Post calls him "one of the most highly regarded independent consultants in America."

Alan says, "These consultants are regarded by peers as being among the world leaders in consulting, as evidenced by empirical accomplishments in client results, professional contributions, and intellectual property."

When Alan's webmaster adds the 2009 inductees to the online roster, I will join professionals like Ed Poll, the person who knows more about running law practices than anyone in the country, Alan Fortier, a strategic planning consultant to the Fortune 50 for over twenty years, and Libby Wagner, whose Influencing Options® is one of the most practical and effective leadership workshop experiences around.

On a personal level, Alan is my mentor in this profession and a trusted friend. My clients and I have benefited from his wisdom in more ways than I can count, and I am deeply honored by this recognition.

Do Labor Laws Foster or Inhibit Innovation?

2009-03-19T18:01:00.000-07:00

The latest MIT Sloan Management Review reports on a new study that surprised me.

Researchers Viral Acharya, Ramin Baghai-Wadji, and Krishnamurthy V. Subramanian correlated labor laws with patent and economic data to show that labor policies that make it harder to let people go seem to correlate with more innovation and greater economic growth:

Why would laws that make it more complicated for employers to let workers go have a positive effect on innovation? One reason, the authors suggest, is that such laws may make employees more willing to take the greater risks associated with attempting innovation.

I have to admit that I'm skeptical about the authors' reasoning. For one thing, the quantity of patents is not a good measure for innovation or risk-taking, although I see it used frequently. Perhaps the engineers are producing a lot of "incremental improvement" patents because they have to keep themselves busy during slow times.

You also have to look at the economic utilization of the patented ideas, and how many of the patents represented true breakthroughs vs. incremental improvements.

Personally, I'll take flexibility any day.

To Thrive, Invest More Now - Not Less

2009-03-17T17:25:00.000-07:00

In today's workshop, the topic of the recession came up, and I learned about a research project that demonstrated that companies that advertise more heavily in a recession come out ahead afterwords - sometimes dramatically so.

McGraw-Hill Research did the study about the 1981-82 recession - the most severe we had had after the Great Depression. This study is widely available online - I chose this quote from a commentary in Arkansas Business because the author nicely summarized the findings:

McGraw-Hill Research studied the marketing spending of 600 U.S. companies during 1980-85. After the 1987 numbers were available, McGraw-Hill concluded that the companies that maintained or increased their advertising during the 1981-82 recession showed an average sales gain of 275 percent during the subsequent five-year period. Those companies that cut advertising during 1981-82 grew sales by an average of only 19 percent during the same period.

This study only looked at advertising dollars - the most short-term component of marketing. But it makes sense that if this is true for advertising, it would be true in spades for long term investments in marketing and product development.

As far as I know, no one's researched the impact of R & D investment, but I"m going to do some poking around to see if I can find one.

"Let's Choose To Be Among The Winners"

2009-03-10T19:42:00.000-07:00

Adam Zak over at Lean Connections has a wonderful post talking about the links between lean thinking and opportunity thinking. Here's a choice snippet:

“A recession creates winners and losers just like a boom,” observed Mauro F. Guillen, a professor of international management at the University of Pennsylvania’s Wharton School in BusinessWeek. Let’s choose to be among the winners.

We get enough people thinking like this and we could all emerge from this recession much stronger than before!!

Follow Me on Twitter for New Developments at Whittier Consulting Group

2009-03-08T09:03:00.000-07:00

I joined Twitter a couple of weeks ago, at the urging of some coaching clients, who use Twitter themselves. It helps us stay better connected.

You can follow me here: @kradeka

I go to some interesting places in the next six months: three countries, over two dozen states, six conferences and more airport club lounges than I'll care to admit (thank you, Priority Pass.) In general, I update only once or twice a day.

This week, I have some major announcements coming up about new products and services to help your company benefit from my experience and expertise to improve product development performance.

Some of these offerings will have limited capacity, and my Twitter friends will be the first to know.

Jim Womack: Lean's Origins in an Economic Crisis

2009-03-05T13:21:00.000-08:00

From Jim Womack of the Lean Enterprise Institute in his latest email letter about lean's roots in the Japanese financial crisis of 1950:

A few [Toyota] line managers had some very simple ideas and an extreme sense of urgency: Minimize lead time from order to delivery (to free up scarce cash.) Remove waste from every step in every process (to reduce costs and enhance quality.) Take action now (because there wasn’t much time.) But what they also had – and this was critical – was a tight scientific discipline. While they did act quickly, they also took the necessary time to document the current state, to state their hypothesis very clearly, to conduct a rigorous experiment, to measure the results, and to reflect on what they had actually achieved, sharing their findings widely....Toyota's remarkable act of creation – based on a scientific process of systematic discovery – was conducted by line managers as the most important part of their daily work. And – here’s the really inspiring part – they did most of their research in midst of a fierce battle for survival.

President Obama's Chief of Staff, Rahm Emanuel, recently said, "A crisis should never go to waste."

What he meant - and what Toyota learned - is that crises have the potential to drive momentum for change. It's easy to stay with the status quo when business is booming. It's admittedly easier to freeze expenses, cut budgets and lay off staff when profit margins erode than it is to develop innovative ways to preserve and even grow the firm's human capital and stay true to the rigors of the scientific method.

Yet Toyota's example shows that is the path to sustainable competitive advantage and even greatness.

Innovation Thrives in Difficult Times

2009-02-24T16:03:00.001-08:00

Innovation thrives in difficult times.

HP, the original garage start up, launched in the middle of the Great Depression. Television, nylon and many of the fundamental technologies that led to computers also had their beginnings in those times - partly because the times were so unfavorable to traditional business. If companies and entrepreneurs could find it within themselves to innovate then - when things were much, much worse than they are today, what's your excuse for holding back now?

The entire lean movement grew out of a severe economic crisis. In post-World War II Japan, Toyota had to figure out how to make cars when the money wasn't there to invest in mass production manufacturing processes. The creative means they developed to eliminate cash-consuming inventory from their production system became the foundations of the Toyota Production System, which became Lean.

Difficult times bring out the scrappiness - the "let's go down to Fry's and see what we can put together" spirit - that creates breakthroughs by forcing people to challenge their assumptions if they want to see their ideas come to fruition.

Right now, good people are available who were too busy two years ago. Office space is easier to get. Vendors are more willing to give good deals to secure customers. A little cash can go a lot farther.

Is this time to launch the skunkworks you've always dreamed of, but couldn't afford the distraction? Is this time to take advantage of the need to slow production to decommission inefficient equipment and bring in new green technology? What opportunities do you have now that you don't have during boom times? What can you do today that will drive your personal recovery?

If you need inspiration, here is an article from December's Wired Magazine"" Back to the Garage: How Economic Turmoil Breeds Innovation.

When Co-Brand Partners Go Bad

2009-02-19T02:36:00.000-08:00

How healthy are your co-branding partners? If they are not healthy, what will be the impact on your customers? Add one more thing to the to-do list for shepherding the company's product lines through this downturn: watch your partners to ensure that they treat your loyal customers with the same care that you do.

JPMorgan Chase® is struggling financially, and it has decided to increase revenues by squeezing its credit card holders: increasing credit card rates and making its terms more onerous for people who either don't charge frequently or who carry a balance.

Until today, I was a happy Chase customer with two credit card accounts: one Amazon.com® co-branded account and one Marriott Rewards® account. Today, in my post office box, there was a message saying that my terms had changed: my interest rate was going up and the other changes were unfavorable to me and not competitive with my other credit card accounts. I had not done anything to trigger this action that I have been able to identify. Fortunately, they did offer an "opt out" option to close the accounts, so I took them up on it.

I know that Amazon and Marriott have no control over Chase's behavior. They have done nothing but license their brand to Chase and link up their rewards programs. But that doesn't get them in the clear.

Here is the problem for Amazon and especially Marriott: their brands are now linked with a distasteful experience in my mind. I travel at least half the time in a given month, and until now, I had preferred Marriott hotels. But the Hilton hotel across the street doesn't remind me of the hassle I had to go through to cancel my rewards credit card. That's enough to change a frequent traveler's behavior, at least some of the time, when the hotel chain can least afford to lose a loyal guest.

From news accounts, this is happening to a lot of people all over the country - the kind of people who would normally be considered model customers in normal times. Given that the people who have taken the trouble to get a hotel chain's rewards card are probably in the upper quartile of frequent travelers, this has the potential to hit Marriott where it hurts.

What safeguards are in place to ensure that your company's loyal customers will be treated well, and your brand will be protected from this sort of harm?

Product Portfolios in Tough Economic Times

2009-02-16T14:37:00.000-08:00

As promised, here is the first in a series of articles and interviews about product development during this recession.

Pam Harper of Business Advancement, Inc. recently interviewed me on the topic "How to Build a Product Development Portfolio in Tough Economic Times" for her podcast.

I produced a companion knowledge brief for Pam's audience, Product Development Portfolios for Difficult Times.

Listen to the 45 minute podcast on Pam's blog, Accelerating Progress.

Please leave comments either there or here with your feedback!

One Healthy Company's Response to the Recession: Invest $7 Billion in New Technology

2009-02-11T16:30:00.000-08:00

Intel just announced a major investment in new facilities to produce the next-generation chip technology, and is encouraging others to follow suit.

This is exactly what the healthy companies need to do: invest in the long-term projects that will position them for leadership during the recovery. Intel's fabs are long lead time items - if Intel waits until the economy looks like it's going to improve, they will miss the window of opportunity.

In the meantime, there are a lot of good people available today who were not available two years ago, and may not be in a year. The "Innovation Economy" is going through a rare period when long-term growth plans are not hampered by the available talent.

Intel has this opportunity because they have limited exposure to the problems other companies have right now to raise capital: they have billions in cash reserves. Still, it takes a lot of courage to seize the moment when everyone else has hunkered down.

What are you doing to take advantage of the opportunities that this recession has created for you?

Product Development in the Economic Crisis

2009-02-05T09:31:00.000-08:00

In the last few months, I have received a number of speaking and writing assignments about how this economic crisis has helped product development.
I'll post the audio from the interviews and the articles that have been published as they are available. In the meantime, I'd like to share with you some ideas that have formed a common thread through all of this work:

Managing product development through this crisis requires you to manage ALL of your company's product development activities - current product and process support as well as new product development - no matter who does them. You need to get a complete picture of all the activity that's going on so that you can allocate resources appropriately.

Your best opportunities may lie with strengthening your base. For example, an organization who needs immediate cash flow may benefit from applying engineering resources to make manufacturing process changes that get cost out of the system. We don't normally think of this as product development - or if we do, it's called "current product support" and shuffled off to a distant team or our junior engineers. But it falls squarely into the realm of product development.
In normal times, this is a good thing - it keeps the new product developers focused on the future. But in these times, you may want to consider applying your most experienced and intelligent minds to the problem of improving current product designs to generate immediate cash.

Cut projects, not budgets. If you have to reduce expenditures, eliminate items from the portfolio entirely rather than ask teams to deliver across-the-board cuts. Give the programs that are on the list the resources to succeed, and eliminate everything else.
I'll never forget the time when a blanket travel freeze forced me to cancel a face to face meeting with development partners at a critical time in my program. We conducted the meeting by Web conference instead, but the relationships were not in place for a remote format to work as well as it needed to work. It took literally months to undo the damage from that decision, wasting many times over the cost of the travel by the time we were done.

Continue your efforts to eliminate waste, especially the big hitters like unproductive meetings and reinvention that suck development resources away when you need them the most.

In a way, we have the advantage in product development over many of our peers: our roles require us to look ahead towards the light at the end of the tunnel. When the recovery begins and your customers want to pull your products from the marketplace, how well will you have prepared your company to respond?

The Role of Advanced R & D

2008-12-29T09:24:00.000-08:00

The relationship between advanced research teams and their counterparts in product development is often fraught with challenges. Advanced R & D teams complain that their counterparts in Product Development don't know how to use them effectively and ignore their ideas. "We can't them to take action on our new product ideas - they just want to make more of the same." Product Development teams wonder what all those PhDs are doing up there in their ivory towers. "Why don't they come back down to earth and help us get products out?"

The key is to recognize that these are distinctly different animals, with different objectives. The key objective of Advanced R&D is to deepen the company's technical knowledge in ways that lead to breakthrough products and new business models. The key objective of Product Development is to use the company's technical knowledge base to turn out a stream of new products in response to the market's needs (spoken and unspoken).

Product Development stays focused on the next few seasons or market window. Advanced R & D looks out for the long term future of the company. A company in a rapidly evolving market that plans to be in business for more than a few years needs both functions, because breakthroughs rarely come on schedule.

The tension between Advanced R & D and Product Development is healthy for the company: it keeps Advanced R & D's big ideas grounded in the realities of the market, and it helps ensure that Product Development can incorporate new technology to address market needs with much less technical risk or invention-on-schedule.

In short, Product Development responds to the market while Advanced R & D develops the company's ability to respond.

PDMA's Role in Growing Product Development Knowledge

2008-09-21T08:22:00.000-07:00

I spent last week at the PDMA International Conference in Orlando, FL.

I just have to say that Disney World is not a good place to have a business meeting where you want people to focus. All the cute kids running around with Mickey Mouse ears and the sight of the Magic Kingdom just over yonder don't contribute to a focused atmosphere. I'm not sure why that is - I've been to business meetings at beach resorts where the beach was a welcome respite rather than a distraction. But in Orlando, I'm always sitting in the meeting rooms wishing that I was riding Space Mountain instead.

Still, I always manage to meet one or two people at PDMA who make the trip worthwhile no matter what the setting or the agenda. This year, it was Mark Adkins of Kennametal. Mark has been involved with PDMA for many years, and he was a Lean Innovation champion for a nonprofit in Ohio in 2004-2006 (if I have my timing correct) before taking a VP position at Kennametal eighteen months ago. Mark and I talked about the efforts PDMA has made to learn more about lean product development.

I think it's naturally hard for some members of PDMA's leadership, especially those who have been around for a long time, to appreciate the value of lean product development. After all, they've seen a lot of trends come and go: cross-functional team, co-location, agile development, Robert Cooper's Stage Gate, etc. Some of these ideas prove their worth and get incorporated into NPD best practices, others fade away.

PDMA sees itself as the guardian of knowledge about how to develop products effectively. Its members have access to the NPD Body of Knowledge, the group publishes the Journal of Product Innovation Management for its academic members, authors "product development 101" books for new PD managers, and certifies New Product Development Practitioners. Given that lean product development has some of these "best practices" directly in its cross-hairs for elimination, it's not surprising that this group has taken awhile to get on board. Still, there have been signs of progress.

April Klimley, the editor of PDMA's Visions magazine for its members, has championed lean authors like Tricia Sutton, Gene Kania and myself. For the last four years, PDMA has had something about lean product development on the agenda for the International Conference - more some years than others, but it has been a consistent presence. Local chapters have put on presentations, or will do so in the coming year. I'm speaking at three chapters myself this year.

This year, Takashi Tanaka of Obeya fame presented as a keynote speaker, and they set aside a space for Tricia Sutton to do a demonstration of Visual Planning. I was there with a Lean Product Development Resource Center, and I gave a half day workshop on lean product development. After my talk with Mark, I would like to make sure that PDMA has a full day workshop and at least two other items on the agenda for next year's conference.

There are a lot of other people working with the lean world to raise lean product development's visibility. Personally, I've decided that I would rather work with PDMA to get these ideas to their membership, while we strengthen the Lean Product and Process Development Exchange to grow and share knowledge within the community.

I would encourage anyone who is committed to growing their ability to develop new products more effectively to check out PDMA, especially any local chapters in their area. The NPDP certification process is worthwhile, too as a way to ensure that you have studied best practices in product development - most of the stuff in the certification review is useful even for lean product development practitioners.

Next year's conference is at Disneyland. I'll just have to sacrifice my weekend to get Space Mountain out of my system BEFORE the conference this year.

Not a Brain Cell to Waste

2008-09-07T20:33:00.000-07:00

I've been fortunate since I started my consulting practice. I've met some amazing people. I've had a lot of fun in places as diverse as Quebec, Minneapolis, Penang, Amsterdam, Orlando, San Diego and Providence, RI to name just a few. I've done well financially and I have enough people coming to me that I don't need to "sell" so much as just ask good questions of the people who come my way.

But that's not what gets me into every morning. If it were just about the fun or about the money, I wouldn't do it - there are easier ways to do both. No, the thing that gets me up every morning is my commitment to the engine of innovation, and its ability to solve problems that make peoples' lives better.

In yesterday's New York Times, Thomas Friedman wrote an article Georgia on My Mind (registration required) where he questioned the two political candidates' commitment to driving the engines of innovation. He took an American perspective on this - claiming that the United States must continue to invest in new technology development to thrive.

I take a more global perspective. I believe that we need innovation to solve many problems that don't begin or end at the borders of any particular nation: eliminating the possibility of terrorism as a tactic while addressing the root causes that foster it, finding alternative clean energy sources, solving public health issues, providing food and clean water to six billion people, bringing developing nations into the global economy, etc, etc. We are here because the engine of innovation opened up lines of communication and possibilities that we could not even imagine at the beginning of the 20th century. We have so many challenges left to solve in the 21st century.

The principles and practices of lean product development help ensure that we use the best of our knowledge to make decisions and eliminate wasted effort, reinvention, unnecessary activities, etc. so that we can solve these problems at the pace we need to solve them.

Whatever product your company makes, your shareholders, executives and customers need you to do it as well and as fast as possible. However your products contribute to the greater good (and we all do, somehow, or our products would not deliver enough value to sell), we also need your best work.

For all of us to live in peace and prosperity, we truly don't have a brain cell to waste.