One of the most challenging tasks and objectives of any innovation management or new product development management team is to increase the the success rate of ideas to products which have high economical impact and reward for the organization.
Lets agree that the real new product development cost is the result of all associate investment a firm has place reach successfully commercial product. In other words the cost of a single successful commercialized product = the sum of all investment done for the full funnel with its different stages + the cost of the successful one. So innovation cost of failure impacts directly the overall efficiency and impact of the enterprise innovation performance.
Based on different statistics, reports and general opinion from innovation and new product development experts the successes rate for newly developed product is an average of 1 over 7. So for each seven introduced products only one returns the desired economical impact. If we added the number from the begging of the funnel which will be from an idea stage, passing through POC, MVP and then reaching commercialization, it will be then clear that the success ratio is more complex and its associated cost is huge.
The main concept behind the ideas funnel staging is to apply the fail fast concept and minimize the final innovation failure cost as much as possible. We all accept the concept that failure is an associated fact in the innovation management domain. The proper selection starting from the idea stage and passing through the funnel impacts directly the final cost structure, minimizes the cost of innovation failure and increases the overall organization innovation economic performance.
So for each of the three stages of the ideas funnel , we have different selection criteria and evaluation technique. Also stakeholders who participate in each stage evaluation needs to be different. For example to select an idea from the Get Stage to starting the cycle in the Build Stage as a POC, we can depend more on the internal organization team members. But if we are designing a selection criteria to move an idea within the Build phase from pre-incubation to incubation or from incubation to acceleration then we need to have more customer validation and external experts feedback. As much as we can engage target customer concept validation from the begging as much as we increase our success rate.
Get Phase Selection Criteria Guideline
- Nothing new in this idea, or no differentiation factor than existing
- Idea is not new (imitating existing product/service) offered by competition but new approach, method or business model is proposed or it capitalize on an existing technology or product portfolio which may affect overall positioning.
- Incremental idea, with limited or undefined impact
- Good idea, more incremental than breakthrough or design to cost innovation with average impact
- True breakthrough idea, give technology superiority, strengthen product portfolio, new use model, significant design to cost impact, future platform or new business model
- MVP- Minimum Viable Product features is not clear or not well defined, risks are not identified and no plan.
- MVP- Minimum Viable Product features not enough. Risk and plan passed minimum point of acceptance.
- Average MVP- Minimum Viable Product features description quality is good. Risk understanding and mitigation are good but plan is not well designed. Delivery risk exists.
- Excellent MVP- Minimum Viable Product features description which serve solving the addressed problem. Average risk identification but well designed plan.
- Evidence of a mastered approach, full feature description, risk identification and well designed plan.
- No competitive advantage over competition and no barrier to entry for competitors.
- Minor competitive edge with unclear differentiation and no barrier to entry for competitors.
- Competitive edge and differentiation is identified. Minor barrier to entry for competitors.
- Competitive edge, differentiation is identified and solid value proposition is in place. Evidence of barrier to entry for competitors exist.
- Clear competitive edge, unique differentiation and evidence of superior value proposition are in place. Barrier to entry is clear.
- No current or future impact.
- Current or future impact is not clear or with minimal significance on the overall competitive advantage.
- Idea serves as a good tactic for leveraging a current technology or product portfolio by offering different use model or help in introducing to a different target segment. Limited impact or time bounded advantage.
- Evidence of either a technological or business impact is identified. Concerns related to business or technology integration exist. Impact realization is not clear.
- Strategic idea which will add clear competitive edge or lead to competitive advantage for current or/and future. Either leveraging existing product portfolio through adding capabilities, serving more customers, enhancing cost structure or introducing new product/service. Opening the horizon for new business model or hitting the nail for a current or future industry trend. Or can be considered as a superior technology positioning.
Build Phase Selection Criteria Guideline
- True breakthrough idea, give technology superiority and/or strengthen product portfolio,
- Future platform, new use or new business model
- Significant design to cost impact,
- More incremental than breakthrough
- Targeted at a real marketplace need (pain or dream, preferred to be a must to have offering), offering clearly articulated benefits to target customer
- Solution use cases and use models are defined and realistic, well thought off solution design and architecture
- Solution is defined and focused to solve the anticipated customer problem, project subsystems and components are defined
- Problem definition is clear
- Intrapreneural team has the required diversified skills to deliver. Team shows unique qualities and seriousness. Team aware of the project details, challenges, obstacles and capable to present the value proposition.
- Intrapreneural team has the technology knowledge / tackled technology challenges. Team presentation quality, idea description, details shows their commitment and interest.
- Intrapreneural team was able to identify their knowledge gap and shows how they are planning to overcome.Team synergy are clear
- Intrapreneural team structure, roles and responsibilities are acceptable and show the overall team strength
- Well thought implementation plan, with demonstrated passion and commitment:
- Project milestones are realistic and achievable
- Project risks are identified and risk mitigation is proposed
- POC Minimum Viable Product features are achievable within the available time considering team size.
- Project components and subsystems are clearly identified. Project main technologies are identified.
- POC Minimum Viable Product features are acceptable to show the real value of the project.
- MVP minimum viable product features are identified and addressing the customer problem identified
Grow Phase Selection Criteria Guideline
- True breakthrough idea, give technology superiority and/or strengthen product portfolio.
- Future platform, new use or new business model.
- Significant design to cost impact.
- More incremental than breakthrough.Accordion Sample Description
- Explored potential for manufacturing and POC/MVP designed accordingly.
- POC/MVP covers different use models and proofs the viability of the product.
- POC/MVP includes minimum viable product features (MVP) that demonstrate the idea technology feasibility.
- POC shows the understanding of the problem with a practical solution.
- Results of the customer validation process shows clear customer interest
- Customer desirability to buy, matches the technical viability with a considerable business viability from forecasted profits perspective.
- POC/MVP demo kit can create customer interest and willingness to pay for further stage of development.
- The link between the POC and the market need (user pain point) is clear.
- POC/MVP Demo and presentation shows the features and capabilities.
- POC/MVP illustrates clearly the idea.