Archive for July, 2013

Contagion!

Posted on: July 15th, 2013 by admin No Comments

I recently read a Scott Adams cartoon http://dilbert.com/strips/comic/2013-06-09/ in the Greensboro News and Record Sunday paper and had flash backs to projects that prematurely move to the production phase.  Experience indicates that this mentality contributes to the recalls to which the consumers are subjected.

Capitalism is based upon the willingness to take risks.  There is no doubt this risk must be a balanced against the rewards for the long-term profitability of the organization. However, when we do not go through appropriate levels of diligence, can we really assess the ratio of reward to risk?

There is much more to product development and project management than the cost and delivery date which seems to drive many organizations.  Experience also suggests, while executives may complain about the cost of poor quality, those same executives do many things to instill a culture of quick to market or delivery over an objective assessment to determine IF and WHEN the product is ready for the market place as this Dilbert cartoon indicates.  They pontificate about when the product must go out, but do not know the details of (or do not care about) what it takes to make sure the quality levels are appropriately balanced against the risks.  Instead of interacting to improve the quality, establishing a culture of diligence and objectivity, we can see a more reactive culture – “why do we lose so much money to poor quality”.  Some want to blame the project managers, who are often in the crossfire between the line organizations cognizant of what should be done, and the executives who know when it must be done not knowing the scope of the activities required to accomplish.  Sometimes we blame the processes. Those same processes we abandon for the sake of quick delivery. Very difficult to blame or correlate to failure processes you willingly abandon.

We treat product development and project management as if it were a predictable science.  Those who understand project management comprehends one of the aspects of the definition is that of being new or unique. This creates a situation that is the opposite of 100% predictable, which in turn, makes our schedule not 100% predictable.  The risks mount as we cascade dependent tasks that compound risks.  We show how to remediate this uncertainty in out book Total Quality Management for Project Management also found at Amazon.

To summarize, the executives set the tone for the organization. If they prize delivery on time (arbitrary or not based upon effort or historical record) over all other aspects of product development and project management – that emphasis will show in the quality of the output product. Once on this slope, we will produce schedules that will meet the time expected which may have no basis in reality or make any use of prior measurements. Next we will find that we eliminate or refuse delivery of an objective assessment, because this may mean we have to alter the unalterable schedule.

Product Life Cycle – Decline

Posted on: July 9th, 2013 by admin No Comments

In the decline phase our rate of growth is now negative sloping. We no longer are garnering more customers and market share but are losing both.  We still may be able to eke out a profit, but we will have to work especially hard doing so. If we were forward thinking, we likely have a replacement new and better “widget” that will restart the entire process all over again. We will likely maintain some replacement parts for the product already sold but our manufacturing processes will ramp down. If we did not believe we could produce a new widget that meets the customer demands or needs, we may ultimately discontinue this sort of product and the associated production line. We may choose to outsource the product to a lower cost country in an attempt to gain more time with this product.

Product Life Cycle – Maturity

Posted on: July 1st, 2013 by admin No Comments

We have seen our product and our sales volume grow, and we begin to see that rate of growth slow. We are entering the maturity phase of our product life cycle. In the maturity phase we are no longer acquiring customers at our previous rate. The market is becoming saturated; perhaps there are newer versions or competing products from other suppliers.  No matter the reason, we can see that our product is nearing the end of the useful cycle.  We should be planning some other product to replace this incoming revenue as we steadily watch the rate of growth reduce. We can extend this maturity phase, perhaps, with cost improvement techniques.  Though our production and distribution processes can be quite mature, there is always the possibility of stemming the rate of decline via cost improvement techniques – a few of which we provide below (more can be read in our Reducing Process Cost book)

  • Brainstorming
  • Lean Manufacturing
  • Total Quality Management
  • Six Sigma
  • Product Tear downs

All of these activities can help us understand where our costs can be better controlled thus retaining our profit in the face of sales volume reductions. These techniques have a range of sophistication or complexity meaning any organization can use to ascertain and improve their cost structure.

Nevertheless, we will eventually see the product steadily decline until we reach the point where there is no growth or zero slope – the harbinger of the next phase decline. Beyond this point, we will see a loss of customers and sales volumes that are hallmark of the product decline.

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