One of the frequent topics I am asked about is processes for new product development. Sometimes the topic is approached from the perspective of an innovation framework, which includes how ideas are discovered for product concepts, or it is focused on developing a concept into a product. Both are addressed by the Stage-Gate system. Stage-Gate International, founded by Dr. Scott Edgett and Dr. Robert Cooper, created the Stage-Gate system after researching what successful product teams did that unsuccessful products teams did not do.
To explore Stage-Gate, I interviewed Mitch Kemp. He is the Managing Director of Stage-Gate International for their business in the United States. Mitch is a Stage-Gate practitioner and coach, specializing in enterprise transformation, strategy, and high value results. He has a broad industry background that includes industrial manufacturing, high tech, financial services and government, working with well-recognized companies across the globe.
In this interview, you will learn:
- who uses Stage-Gate and why
- framework basics, and
- adding agility to Stage-Gate.
Practices and Ideas for Product Managers, Developers, and Innovators
Summary of questions discussed:
- How did Stage-Gate come into existence? Stage-Gate has a 30 year history. It started with Dr. Bob Cooper and Dr. Scott Edgett’s fundamental research on what makes companies better innovators. The results of that research was a set of best practices that evolved into what we know commonly as Stage-Gate. But really, there are four key drivers that we found to drive innovation results. One is of course the Stage-Gate process. The other drivers are innovation strategy, portfolio management, and innovation culture. Together, those four drivers create our Innovation Performance Framework with Stage-Gate as the foundation. A philosophy is embedded in this framework, which is to do the right projects and to do those projects right.
- Who uses stage-gate and why? 80% of the Fortune 1000 uses Stage-Gate-like process. Sometimes they call it Stage-Gate or they use other terms. It is used in businesses of all sizes, but by the time revenue exceeds $100 million dollars, the organization really needs a Stage-Gate system. Other factors are the complexity of the business, the number of products developed, and the competitive environment.
- What are the Stage-Gate basics we should know? All organizations will use stages tailored to their environment, but there are three primary stages with gates in between:
- Scoping: We begin with a scoping stage that is two to four-weeks in duration. This involves preliminary market and customer research to understand a problem and its needs. Also, technical feasibility of a solution is investigated.
- Business case: A business case is developed to assess and justify pursuing the product concept. The business case is used to determine if the project deserves further investment.
- Develop: This is the stage where the product concept is developed into an actual product – physical goods or intangible service.
- Between each stage is a gate, which is a meeting of senior managers who decide if the project should continue to the next stage.
- A frequent topic I encounter with medium to large organizations is the need for a flexible or agile Stage-Gate, which implies some rigidity to the original Stage-Gate and the need to adapt it to groups doing agile development. How has Stage-Gate International responded to this? Stage-Gate is about making sure you have the right information to make a business decision. Agile is a project management technique and you need the best project management technique for the technology that you’re developing. The technique is actually independent of Stage-Gate. You might be using agile in software development and another project management approach for chip design. At some point the different elements of the product have to come together. Stage-Gate is the plan for how all these components come together and how risk is minimized throughout the project. Stage-Gate manages your risk tolerance throughout the project and recognizes where larger investments will need to be made during the project. It stays focused on the business case as the project proceeds – continuing to address the concern of developing a product that can actually be sold and serviced, meeting or exceeding our expectations.
- Can you share an example of an organization using an agile stage-gate and what they did to become more agile? It’s difficult to identify organizations by name but we do have some case studies available (see link below to the “What Leading Companies are Doing to Re-Invent their NPD Processes”). One of the trends taking place in product development is the shortening of development cycles. If you can build the product in 90 days, there is much less rigor needed in a Stage-Gate process. Instead, if the project will take two years, then more rigor is needed. The needs of the project should be balanced with the amount of rigor used in a Stage-Gate process. The case studies provide helpful details.
- What Leading Companies are Doing to Re-Invent their NPD Processes – case studies
- Stage-Gate International
- Next Generation (Lean) Stage-Gate process
“Do the right projects, do projects right.” – Bob Cooper, Stage-Gate International co-founder
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Raw TranscriptTEI062-Mitch Kemp
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