News.com has a McKinsey Quarterly article, which states that “product development is facing a fundamental challenge. Unfortunately, at the very moment when companies need to make better products more efficiently, previous performance innovations in product development have hit a plateau.” It suggests a new approach.
The key to the new approach is an entirely different way of making product development decisions. By improving the quality, timing and synthesis of product and process information throughout the development cycle, such companies have turned a linear and sequential process into a flexible one that reacts to information continually rather than at intervals and in batches.
A team that used an information-based approach began by creating three simultaneous work flows: one for the needs of customers and the design features of the product, a second for its cost and a third for its reliability. The three subteams communicated daily and assessed all of their findings every week. By organizing around the flow of information, the team looked at market research through a new lens and made an important discovery: Customers care most about the cost and reliability, not their throughput performance and other advanced features, as the team had previously assumed.
Instead of using a linear approach to collect information, make a decision and then base other decisions on the first one, information-based teams solve problems continually and combine their findings frequently. Like the medical device companys team, they work in a way that allows them to converge on the best solution. This style of work resembles the “daily-build” method that many software companies use: The code produced by individual programmers is compiled every day so that project leaders can test it for bugs and functions. Problems are reported immediately, and the team knows, on a daily basis, how close it is to its ultimate goal.
By gaining the ability to delay the point when product designs must be “frozen,” information-based teams keep their options open longer and can respond to changes in the market at later stages of the development process. Senior management imposes fewer constraints on these teams than on their conventional counterparts so that they can consider a broader set of solutions; concepts may take longer to develop, but the company ultimately saves time.