MGMT 461 Managing Change & Innovation TOPIC 6: Implementing innovations
A/Prof Tatiana Zalan
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Where are we in the course?
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Foundations:
Introduction to Innovation (T1)
Innovation & Economics (T2)
Developing an
innovation strategy (T3)
Creativity and idea
generation (T4)
Selecting and managing
an innovation portfolio (T5)
Implementing
innovations (T6)
Creating an
innovative culture (T7)
Boosting
innovation
performance (T8)
Funding and fostering innovation (T9)
Platforms & ecosystems (T10)
Innovation & change (T11)
Agenda and objectives
To clarify / explain:
Traditional / Predictive vs agile techniques for project management (PM)
Basic techniques of traditional project management (TPM)
Risk management
Linking customer needs to product design
Managing stakeholders
Managing people and processes in an innovation department
Basic techniques of agile product management
Managing an innovation department
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Pizza Hut
7-stage NPD process called the FRPP – the ‘Field Ready Product Process’
Defines the steps that are necessary to develop the recipe, select suppliers, test ‘manufacturability’ and ensure positive customer reactions
Ensures that employees are adequately trained on the new product before its release
Essential to have a reliable but flexible NPD process
Difference between project management and managing innovative projects
Innovation projects tend to start with loosely defined, sometimes even ambiguous objectives that become clearer as the project proceeds. The processes used are more experimental and exploratory and seldom follow strict linear guidelines.
Teams need to be more diverse and have a higher level of trust as they explore new territory where failure is a possibility.
With failure as a built-in possibility, innovation teams are more actively involved with risk management and need to learn to fail fast and fail smart in to move on to more attractive options.
Innovation projects generally need to be sold to project sponsors and funding committees, a responsibility usually not required from normal project teams.
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Source: Wycoff (n.d.)
17–6
Traditional PM versus Agile Methods
Traditional PM Approach (TPM)
Concentrates on thorough, upfront planning of the entire project.
Requires a high degree of predictability to be effective.
Agile Project Management (Agile PM)
Relies on incremental, iterative development cycles to complete less-predictable projects.
Is ideal for exploratory projects in which requirements need to be discovered and new technology tested.
Focuses on active collaboration between the project team and customer representatives.
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Project’s phases
Projects are classically considered to have four phases:
The concept phase – the Ideas and Selection Phase of the Pentathlon; ideally ends with all commercial and technical uncertainties removed, so that it can proceed to the next stage without risk of failure
The design phase – sometimes referred to as “fuzzy front end” (often ill done and takes too long)
The planning phase
The implementation phase
Types of Traditional PM Approaches
(with application to software development)
Linear (aka Waterfall)
Originated in construction and manufacturing industries, over a third of software developers still use it
Is completed in (sequentially) e.g. Scope to Plan to Launch to Monitor and Control and then to Project Closeout.
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My First Template
Critical Path Method
CPM is a mathematically based algorithm for scheduling a set of project activities. The essential technique for using CPM is to construct a model of the project that includes the following:
A list of all activities required to complete the project,
The dependencies between the activities, and
The estimate of time (duration) that each activity will take to completion.
Using these values, CPM usually calculates
the longest path of planned activities to the end of the project,
and the earliest and latest points that each activity can start and finish without making the project longer.
This process determines which activities are “critical” (i.e., on the longest path) and which have “total float” (i.e., can be delayed without making the project longer).
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My First Template
Critical Path Method
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My First Template
Project Triple Constraint
Scope goals:
What work will be done?
Time goals:
How long should it take to complete?
Cost goals:
What should it cost?
Is it what the customer wanted ?
GOALS ARE LINKED
Monitor and Control
Risk
Deliver On Time and within Budget
*** Project must satisfy sponsor, client and major stakeholders to ensure future projects ***
Quality
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3Pillars Asia Pacific
NCVER Project Management Principles
November 2010
Project Tradeoffs
| Issue | Reduction in project profit |
| Product introduced 6 months late | 31% |
| Quality problems reduce selling price by 10% | 15% |
| Compatibility problems reduce sales volume by 10% | 4% |
| 10% product cost excess | 4% |
| 30% development project budget overrun | 2 % |
Assumes market growing at 20% a year with price fall 12% a year
Timeliness is usually the most important factor in NPD.
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Five elements in TPM essential to project success
Clear and precise aims
A breakdown of the work into sub-tasks
A schedule – all task are undertaken in the right and at the right times
A resource plan to ensure that people and facilities are available
Active management of stakeholders
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Not every aspect of the project must, or can, be specified from the start. However, every innovation project should at least have a clear project charter.
Full specifications may require time and study to complete but it is vital to ensure that they are completed as quickly as possible.
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Project Aims
Clear project aims are essential.
For new products:
The key element is the product specification,
But, related tasks (Manufacturing, Sales, Procurement etc.) must also be specified
Key aspects must be clear from the start
Every project should have a project charter
a one-page brief that sets out the purpose and key objectives of the project – i.e., the elements that are essential to success.
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Not every aspect of the project must, or can, be specified from the start. However, every innovation project should at least have a clear project charter.
Full specifications may require time and study to complete but it is vital to ensure that they are completed as quickly as possible.
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Planning and work breakdown
The first step in planning : break down the work into packages with deliverables whose completion can be tracked
The next requirement is a schedule of when the tasks are to be done.
Next, the requirements for various resources can be assessed The Resource Plan
The Resource Plan ensures that resources (especially people) are not overloaded
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Without step 1, we cannot estimate the time or resources required.
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2. Work Breakdown Structure
Project
Main Task 3
(eg marketing)
Main Task 2
(eg implementation)
MainTask 1
(eg design)
Task
Task
Task
Task
Task
Task
Task
Task
Task
Task
Task
Task
Task
Task
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Reviewing the WBS (work breakdown structure) is helpful in promoting teamwork.
The personnel required can now be identified
The Critical Path shows the sequence of jobs that define the time to complete the project.
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Managing risks
The key risks must be identified and plans put in place to resolve the major ones early (particularly those that may threaten the viability of the project).
A list of risks is the starting point.
Failure Mode and Effect Analysis (FMEA):
can be used to prioritize project risks
Takes into account:
the risks’ likelihood and severity;
the danger that they will not be detected and corrected in time
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https://www.youtube.com/watch?v=gogQLQNrDds&feature= youtu.be
Innovation projects may face high levels of uncertainty.
Developing a list of risks: People may be unwilling to express their concerns openly so it may be helpful to use an outside facilitator to collect and clarify them.
Failure Mode and Effect Analysis or FMEA was originally developed for assessing product reliability and can be used to prioritise project risks, taking account of their likelihood and severity; and the risk that they will not be detected and corrected in time (next slide)
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FMEA Process
Start with the process map
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For each step, brainstorm potential failure modes and effects
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Determine the potential causes to each failure mode
3
Evaluate current controls
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Determine severity
Determine likelihood of occurrence
Determine detectability
Determine RPN
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Identify actions
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FMEA Applied to a Supermarket Checkout Process (assigned on a scale of 1-10)
| Failure mode | Likelihood | Severity of impact | Failure to detect | Risk Priority Score | Action |
| No bar code on product | 5 | 2 | 4 | 40 | Review process. Consider reward for detection |
| Bar code reader fails | 1 | 2 | 1 | 2 | |
| Product wrongly recorded/priced in computer system | 3 | 8 | 6 | 144 | Special project required |
| Item not on computer | 5 | 2 | 1 | 10 | |
| Assistant enters same item twice | 2 | 8 | 7 | 112 | Investigate software prompt. |
| Assistant fails to enter item | 2 | 2 | 9 | 36 | Training |
| Out of bags | 4 | 8 | 1 | 32 | Plenty of spares |
| Item dropped or broken | 6 | 6 | 1 | 36 | Review flooring |
Every part of the project is assessed in detail to determine all the was in which it might fail.
Each failure mode is ascribed a score of 1 – 10, according to how likely it is to happen.
A further score of 1-10 is given to the severity of the impact the failure would have if it happened. Safety issues are usually assigned a maximum score.
A 3rd score is used to indicate the likelihood the failure will not be detected (or corrected in time).
The Risk priority score is computed multiplying the 3 scores. – It gives an overall indication of the risk posed by each element.
Table7.4 above illustrates this analysis applied to the checkout process at a supermarket.
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FMEA
Cause & Effect Diagram
Fault Tree Analysis
Bottoms-up approach to failure analysis
Systematic method for identifying all the potential failure modes of a process or product
Creates prioritized ranking of failure modes within a system
Examines a certain failure mode or event and identifies all the possible causes
Causes are grouped into several logical categories
Top-down approach to failure analysis
Starting point is a failure or “undesired state”
Drill down into lower level events leading up to the undesired state
Similar to the 5 Why’s method
FMEA and other risk analysis tools
Linking Customer Needs to Product Features – Quality Function Deployment (QFD)
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Identify customer wants / hidden needs
Identify how the good/service will satisfy customer wants
Relate customer wants to product hows
Identify relationships between the firm’s hows
Develop importance ratings
Evaluate competing products
Compare performance to desirable technical attributes
The overall structure is shown in the next slide and analysed in detail in the next 3 slides
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1
2
3
4
Customer needs and importance ratings
Specification
Interaction
matrix
Specification
priority scores
Conflicts
QFD: “The House of Quality”
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Identified through empathic design, lead user technique, observation, etc.
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Central QFD Interaction Matrix
The Needs may be given different weights.
Features specified for the service are shown on the top.
The features’ impact on achieving the customer Needs is shown by 1, 2 or 3 stars (“impact”).
The relative importance of the Features is found by multiplying the impact score by the weighting for each Need and adding the results.
Outcomes of the analysis:
The most important features (with most scores) must be given priority in the design stage
Those with low scores are candidates for elimination.
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The impact scores are usually chosen to be non-linear: 1 star=1; 2 stars= 3; 3 stars=9.
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Reliable 7
Daily Delivery 10
Mail not damaged 9
Mail can be diverted 5
Arrangements for absence 4
Low cost 6
Local distribution depots
Staff quality + incentives
Local transport
Address reading system
Sorting process
Customer profile info.
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