How to Talk to Product Developers about Value
I have a hint for those of you working in "lean six sigma change agent" roles or similar areas where you are expected to evangelize lean into product development: you need to stop talking like manufacturing people, and start talking value in terms that are meaningful to product developers.
Let's take "takt time" or "cycle time" for instance. A typical product development project takes months, if not years - unlike the hours or days a manufacturing process takes. A product development organization can usually tell you how long it will take to develop a "typical" product with a given scope. Better ones can give a pretty accurate estimate for the time from the end of feasibility to the beginning of production for several different types of projects.
But the term "cycle time" doesn't reflect the way product development managers think about time. These managers develop and execute product strategies that detail the products to be delivered into specific markets at specific points in time. Development managers think in terms of how far in advance the projects need to start in order to finish on time. This metric is called "time to market" or "speed to market" to reflect the managers' focus on delivering the product.
"Takt time" is even worse because it implies regularity and consistency that simply doesn't reflect realities in product development. We may do a simple refresh on last year's product for 2008 so that we can leapfrog the competition with a completely new product in 2009. Not even Toyota, with its annual demand for new car models, is as consistent as a takt time would indicate.
You need to be similarly careful when talking about costs. When you talk about cost reductions, do you mean development cost, tooling cost, direct material cost, cost to manufacture, cost to service and support, or sales and marketing costs? If you use a value stream map as your primary tool, the only cost you can impact is development cost, but that is usually only a small part of the overall product cost. If you are focused on Design for Manufacture and Assembly (DFMA) or of of its variants, then how are you measuring the impact to total product cost?
Let's take "takt time" or "cycle time" for instance. A typical product development project takes months, if not years - unlike the hours or days a manufacturing process takes. A product development organization can usually tell you how long it will take to develop a "typical" product with a given scope. Better ones can give a pretty accurate estimate for the time from the end of feasibility to the beginning of production for several different types of projects.
But the term "cycle time" doesn't reflect the way product development managers think about time. These managers develop and execute product strategies that detail the products to be delivered into specific markets at specific points in time. Development managers think in terms of how far in advance the projects need to start in order to finish on time. This metric is called "time to market" or "speed to market" to reflect the managers' focus on delivering the product.
"Takt time" is even worse because it implies regularity and consistency that simply doesn't reflect realities in product development. We may do a simple refresh on last year's product for 2008 so that we can leapfrog the competition with a completely new product in 2009. Not even Toyota, with its annual demand for new car models, is as consistent as a takt time would indicate.
You need to be similarly careful when talking about costs. When you talk about cost reductions, do you mean development cost, tooling cost, direct material cost, cost to manufacture, cost to service and support, or sales and marketing costs? If you use a value stream map as your primary tool, the only cost you can impact is development cost, but that is usually only a small part of the overall product cost. If you are focused on Design for Manufacture and Assembly (DFMA) or of of its variants, then how are you measuring the impact to total product cost?
Labels: cost, time-to-market, value
posted by Katherine Radeka
at
3:21 PM
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