Shipulski On Design

Posts Tagged ‘Product Development Engine’

Choose the right project. When you say yes to a new project, all the focus is on the incremental revenue the project will generate and none of the focus is on unrealized incremental revenue from the projects you said no to. Next time there’s a proposal to start a new project, ask the team to describe the two or three most compelling projects that they are asking the company to say no to.  Grounding the go/no-go decision within the context of the most compelling projects will help you avoid the real backbreaker where you consume all your product development resources on something that scratches the wrong itch while you prevent those resources from creating something magical.

Choose what to improve. Give your customers more of what you gave them last time unless what you gave them last time is good enough. Once goodness is good enough, giving customers more is bad business because your costs increase but their willingness to pay does not.  Once your offering meets the customers’ needs in one area, lock it down and improve a different area.

Choose how to staff the projects.  There is a strong temptation to run many projects in parallel.  It’s almost like our objective is to maximize the number of active projects at the expense of completing them.  Here’s the thing about projects – there is no partial credit for partially completed projects.  Eight active projects that are eight (or eighty) percent complete generate zero revenue and have zero commercial value.  For your most important project, staff it fully.  Add resources until adding more resources would slow the project.  Then, for your next most important project, repeat the process with your remaining resources.  And once a project is completed, add those resources to the pool and start another project.  This approach is especially powerful because it prioritizes finishing projects over starting them.

“Three Cows” by Sunfox is licensed under CC BY-SA 2.0.

Whatever your initiative, start with customer value. Whatever your project, base it on customer value. And whatever your new technology, you guessed it, customer value should be front and center.

Whenever the discussion turns to customer value, expect confusion, disagreement, and, likely, anger. To help things move forward, here’s an operational definition I’ve found helpful:

When they buy it for more than your cost to make it, you have customer value.

And when there’s no way to pull out of the death spiral of disagreement, use this operational definition to avoid (or stop) bad projects:

When no one will buy it, you don’t have customer value and it’s a bad project.

As two words, customer and value don’t seem all that special. But, when you put them together, they become words to live by.  But, also, when you do put them together, things get complicated.  Here’s why.

To provide customer value, you’ve got to know (and name) the customer.  When you asked “Who is the customer?” the wheels fall off. Here are some wrong answers to that tricky question. The Board of Directors is the customer. The shareholders are the customers. The distributor is the customer. The OEM that integrates your product is the customer. And the people that use the product are the customer. Here’s an operational definition that will set you free:

When someone buys it, they are the customer.

When the discussions get sticky, hold onto that definition. Others will try to bait you into thinking differently, but don’t bite. It will be difficult to stand your ground.  And if you feel the group is headed in the wrong direction, try to set things right with this operational definition:

When you’ve found the person who opens their wallet, you’ve found the customer.

Now, let’s talk about value. Isn’t value subjective? Yes, it is.  And the only opinion that matters is the customer’s. And here’s an operational definition to help you create customer value:

When you solve an important customer problem, they find it valuable.

And there you have it.  Putting it all together, here’s the recipe for customer value:

1. Understand who will buy it.
2. Understand their work and identify their biggest problem.
3. Solve their problem and embed it in your offering.
4. Sell it for more than it costs you to make it.

Image credit — Caroline

When the fate of your company rests on a single project, who are the three people you’d tap to drag that pivotal project over the finish line? And to sharpen it further, ask yourself “Who do I want to lead the project that will save the company?” You now have a list of the three most important people in your company.  Or, if you answered the second question, you now have the name of the most important person in your company.

The most important person in your company is the person that drags the most important projects over the finish line.  Full stop.

When the project is on the line, the CEO doesn’t matter; the General Manager doesn’t matter; the Business Leader doesn’t matter.  The person that matters most is the Project Manager.  And the second and third most important people are the two people that the Project Manager relies on.

Don’t believe that? Well, take a bite of this. If the project fails, the product doesn’t sell. And if the product doesn’t sell, the revenue doesn’t come. And if the revenue doesn’t come, it’s game over. Regardless of how hard the CEO pulls, the product doesn’t launch, the revenue doesn’t come, and the company dies.  Regardless of how angry the GM gets, without a product launch, there’s no revenue, and it’s lights out.  And regardless of the Business Leader’s cajoling, the project doesn’t cross the finish line unless the Project Manager makes it happen.

The CEO can’t launch the product. The GM can’t launch the product. The Business Leader can’t launch the product.  Stop for a minute and let that sink in.  Now, go back to those three sentences and read them out loud. No, really, read them out loud.  I’ll wait.

When the wheels fall off a project, the CEO can’t put them back on. Only a special Project Manager can do that.

There are tools for project management, there are degrees in project management, and there are certifications for project management.  But all that is meaningless because project management is alchemy.

Degrees don’t matter. What matters is that you’ve taken over a poorly run project, turned it on its head, and dragged it across the line. What matters is you’ve run a project that was poorly defined, poorly staffed, and poorly funded and brought it home kicking and screaming. What matters is you’ve landed a project successfully when two of three engines were on fire. (Belly landings count.) What matters is that you vehemently dismiss the continuous improvement community on the grounds there can be no best practice for a project that creates something that’s new to the world. What matters is that you can feel the critical path in your chest. What matters is that you’ve sprinted toward the scariest projects and people followed you. And what matters most is they’ll follow you again.

Project Managers have won the hearts and minds of the project team.

The Project manager knows what the team needs and provides it before the team needs it. And when an unplanned need arises, like it always does, the project manager begs, borrows, and steals to secure what the team needs.  And when they can’t get what’s needed, they apologize to the team, re-plan the project, reset the completion date, and deliver the bad news to those that don’t want to hear it.

If the General Manager says the project will be done in three months and the Project Manager thinks otherwise, put your money on the Project Manager.

Project Managers aren’t at the top of the org chart, but we punch above our weight. We’ve earned the trust and respect of most everyone. We aren’t liked by everyone, but we’re trusted by all. And we’re not always understood, but everyone knows our intentions are good. And when we ask for help, people drop what they’re doing and pitch in. In fact, they line up to help. They line up because we’ve gone out of our way to help them over the last decade. And they line up to help because we’ve put it on the table.

Whether it’s IoT, Digital Strategy, Industry 4.0, top-line growth, recurring revenue, new business models, or happier customers, it’s all about the projects. None of this is possible without projects. And the keystone of successful projects?  You guessed it.  Project Managers.

Image credit – Bernard Spragg .NZ

All-or-nothing thinking is exciting – we’ll launch a whole new product family all at once and take the market by storm! But it’s also dangerous – if we have one small hiccup, “all” turns into “nothing” in a heartbeat. When you take an all-or-nothing approach, it’s likely you’ll have far too little “all” and far too much “nothing”.

Instead of trying to realize the perfection of “all”, it’s far better to turn nothing into something.  Here’s the math for an all-or-nothing launch of product family launch consisting of four products, where each product will create $1 million in revenue and the probability of launching each product is 0.5 (or 50%).

1 product x $1 million x 0.5 = $500K

2 products x $1 million x 0.5 x 0.5 = $500K

3 products x $1 million x 0.5 x 0.5 x 0.5 = $375K

4 products x $1 million x 0.5 x 0.5 x 0.5 x 0.5 = $250K

In the all-or-nothing scheme, the launch of each product is contingent on all the others.  And if the probability of each launch is 0.5, the launch of the whole product family is like a chain of four links, where each link has a 50% chance of breaking.  When a single link of a chain breaks, there’s no chain. And it’s the same with an all-or-nothing launch – if a single product isn’t ready for launch, there are no product launches.

But the math is worse than that. Assume there’s new technology in all the products and there are five new failure modes that must be overcome.  With all-or-nothing, if a single failure mode of a single product is a problem, there are no launches.

But the math is even more deadly than that. If there are four use models (customer segments that use the product differently) and only one of those use models creates a problem with one of the twenty failure modes (five failure modes times four products) there can be no launches. In that way, if 25% of the customers have one problem with a single failure mode, there are can be no launches.  Taken to an extreme, if one customer has one problem with one product, there can be no launches.

The problem with all-or-nothing is there’s no partial credit – you either launch four products or you launch none. Instead of all-or-nothing, think “secure the launch”. What must we do to secure the launch of a single product? And once that one’s launched, the money starts to flow.  And once we launch the first one, what must we do to secure the launch the second? (More money flows.) And, once we launch the third one…. you get the picture. Don’t try to launch four at once, launch a single product four times in a row. Instead of all-or-nothing, think one-in-a-row, where revenue is achieved after each launch of a single launch.

And there’s another benefit to launching one at a time. The second launch is informed by learning from the first launch.  And the third is informed by the first two. With one-in-a-row, the team gets smarter and each launch gets better.

Where all-or-nothing is glamorous, one-in-a-row is achievable. Where all-or-nothing is exciting, one-in-row is achievable. And where all-or-nothing is highly improbable, one-in-a-row is highly profitable.

Image credit – Mel

Wanting things to be different is a good start, but it’s not enough. To create conditions for things to move in a new direction, you’ve got to change your behavior. But with systems that involve people, this is not a straightforward process.

To create conditions for the system to change, you must understand the system”s disposition – the lines along which it prefers to change.. And to do that, you’ve got to push on the system and watch its response. With people systems, the response is not knowable before the experiment.

If you expect to be able to predict how the system will respond, working with people systems can be frustrating.  I offer some guidance here. With this work, you are not responsible for the system’s response, you are only responsible for how you respond to the system’s response.

If the system responds in a way you like, turn that experiment into a project to amplify the change.  If the system responds in a way you dislike, unwind the experiment.  Here’s a simple mantra – do more of what works and less of what doesn’t. (Thanks to Dave Snowden for this.)

If you don’t like how things are going, you have only one lever to pull.  You can only change.your response to what you see and experience. You can respond by pushing on the system and responding to what you see or you can respond by changing what you think and feel about the system.

But keep in mind that you are part of the system. And maybe the system is running an experiment on you. Either way, your only choice is to choose how to respond.

The primary impediment to innovation is fear, and the prime directive of any innovation system should be to drive out fear.

A culture of accountability, implemented poorly, can inject fear and deter innovation.  When the team is accountable to deliver on a project but are constrained to a fixed scope, a fixed launch date and resources, they will be afraid.  Because they know that innovation requires new work and new work is inherently unpredictable, they rightly recognize the triple accountability – time, scope and resources – cannot be met.  From the very first day of the project, they know they cannot be successful and are afraid of the consequences.

A culture of accountability can be adapted to innovation to reduce fear.  Here’s one way. Keep the team small and keep them dedicated to a single innovation project. No resource sharing, no swapping and no double counting. Create tight time blocks with clear work objectives, where the team reports back on a fixed pitch (weekly, monthly). But make it clear that they can flex on scope and level of completeness.  They should try to do all the work within the time constraints but they must know that it’s expected the scope will narrow or shift and the level of completeness will be governed by the time constraint.  Tell them you believe in them and you trust them to do their best, then praise their good judgement at the review meeting at the end of the time block.

Innovation is about solving new problems, yet fear blocks teams from trying new things. Teams like to solve problems that are familiar because they have seen previous teams judged negatively for missing deadlines. Here’s the logic – we’d rather add too little novelty than be late.  The team would love to solve new problems but their afraid, based on past projects, that they’ll be chastised for missing a completion date that’s disrespectful of the work content and level of novelty.  If you want the team to solve new problems, give them the tools, time, training and a teacher so they can select different problems and solve them differently. Simply put – create the causes and conditions for fear to quietly slink away so innovation will flow.

Fear is the most powerful inhibitor. But before we can lessen the team’s fear we’ve got to recognize the causes and conditions that create it. Fear’s job is to keep us safe, to keep us away from situations that have been risky or dangerous.  To do this, our bodies create deep memories of those dangerous or scary situations and creates fear when it recognizes similarities between the current situation and past dangerous situations.  In that way, less fear is created if the current situation feels differently from situations of the past where people were judged negatively.

To understand the causes and conditions that create fear, look back at previous projects.  Make a list of the projects where project members were judged negatively for things outside their control such as: arbitrary launch dates not bound by the work content, high risk levels driven by unjustifiable specifications, insufficient resources, inadequate tools, poor training and no teacher.  And make a list of projects where team members were praised.  For the projects that praised, write down attributes of those projects (e.g., high reuse, low technical risk) and their outcomes (e.g., on time, on cost).  To reduce fear, the project team will bend new projects toward those attributes and outcomes. Do the same for projects that judged negatively for things outside the project teams’ control. To reduce fear, the future project teams will bend away from those attributes and outcomes.

Now the difficult parts.  As a leader, it’s time to look inside.  Make a list of your behaviors that set (or contributed to) causes and conditions that made it easy for the project team to be judged negatively for the wrong reasons.  And then make a list of your new behaviors that will create future causes and conditions where people aren’t afraid to solve new problems in new ways.

Image credit — andrea floris

There are four ways to run projects.

One – 80% Right, 100% Done, 100% On Time, 100% On Budget

• Fix time
• Fix resources
• Flex scope and certainty

Set a tight timeline and use the people and budget you have.  You’ll be done on time, but you must accept a reduced scope (fewer bells and whistles) and less certainty of how the product/service will perform and how well it will be received by customers. This is a good way to go when you’re starting a new adventure or investigating new space.

Two – 100% Right, 100% Done, 0% On Time, 0% On Budget

• Fix resources
• Fix scope and certainty
• Flex time

Use the team and budget you have and tightly define the scope (features) and define the level of certainty required by your customers. Because you can’t predict when the project will be done, you’ll be late and over budget, but your offering will be right and customers will like it. Use this method when your brand is known for predictability and stability. But, be weary of business implications of being late to market.

Three – 100% Right, 100% Done, 100% On Time, 0% On Budget

• Fix scope and certainty
• Fix time
• Flex resources

Tightly define the scope and level of certainty. Your customers will get what they expect and they’ll get it on time.  However, this method will be costly. If you hire contract resources, they will be expensive.  And if you use internal resources, you’ll have to stop one project to start this one. The benefits from the stopped project won’t be realized and will increase the effective cost to the company.  And even though time is fixed, this approach will likely be late.  It will take longer than planned to move resources from one project to another and will take longer than planned to hire contract resources and get them up and running.  Use this method if you’ve already established good working relationships with contract resources.  Avoid this method if you have difficulty stopping existing projects to start new ones.

Four – Not Right, Not Done, Not On Time, Not On Budget

• Fix time
• Fix resources
• Fix scope and certainty

Though almost every project plan is based on this approach, it never works.  Sure, it would be great if it worked, but it doesn’t, it hasn’t and it won’t. There’s not enough time to do the right work, not enough money to get the work done on time and no one is willing to flex on scope and certainty.  Everyone knows it won’t work and we do it anyway.  The result – a stressful project that doesn’t deliver and no one feels good about.

Image credit – Cees Schipper

Every day starts and ends in the present. Sure, you can put yourself in the future and image what it could be or put yourself in the past and remember what was. But, neither domain is actionable. You can’t change the past, nor can you control the future.  The only thing that’s actionable is the present.

Every morning your day starts with the body you have.  You may have had a more pleasing body in the past, but that’s gone.  You may have visions of changing your body into something else, but you don’t have that yet. What you do today is governed and enabled by your body as it is. If you try to lift three hundred pounds, your system as it is will either pick it up or it won’t.

Every morning your day starts with the mind you have. It may have been busy and distracted in the past and it may be calm and settled in the future, but that doesn’t matter. The only thing that matters is your mind as it is. If you respond kindly, today’s mind is responsible, and if your response is unkind, today’s mind system is the culprit.  Like it or not, your thoughts, feelings and actions are the result of your mind as it is.

Change always starts with where you are, and the first step is unclear until you assess and define your systems as they are. If you haven’t worked out in five years, your first step is to see your doctor to get clearance (professional assessment) for your upcoming physical improvement plan. If you’ve run ten marathons over the last ten months, your first step may be to take a month off to recover. The right next step starts with where you are.

And it’s the same with your mind. If your mind is all over the place your likely first step is to learn how to help it settle down.  And once it’s a little more settled, your next step may be to use more advanced methods to settle it further. And if you assess your mind and you see it needs more help than you can give it, your next step is to seek professional help. Again, your next step is defined by where you are.

And it’s the same with business.  Every morning starts with the products and services you have. You can’t sell the obsolete products you had, nor can you sell the future services you may develop. You can only sell what you have.  But, in parallel, you can create the next product or system.  And to do that, the first step is to take a deep, dispassionate look at the system as it is. What does it do well? What does it do poorly? What can be built on and what can be discarded?  There are a number of tools for this, but more important than the tools is to recognize that the next one starts with an assessment of the one you have.

If the existing system is young and immature, the first step is likely to nurture it and support it so it can grow out of its adolescence.  But the first step is NOT to lift three hundred pounds because the system-as it is-can only lift fifty. If you lift too much too early, you’ll break its back.

If the existing system is in it’s prime and has been going to the gym regularly for the last five years, its ready for three hundred pounds.  Go for it! But, in parallel, it’s time to start a new activity, one that will replace the weightlifting when the system can no longer lift like it used to.  Maybe tennis? But start now because to get good at tennis requires new muscles and time.

And if the existing system is ready for retirement, retire it. Difficult to do, but once there’s public acknowledgement, the retirement will take care of itself.

If you want to know what’s next, define the system as it is. The next step will be clear.

And the best time to do it is now.

Image credit – NASA

When there’s too much to do and too few to do it, the natural state of the system is fuller than full.  And in today’s world we run all our systems this way, including our people systems.

A funny thing happens when people’s plates are full – when a new task is added an existing one hits the floor.  This isn’t negligence, it’s not the result of a bad attitude and it’s not about being a team player.  This is an inherent property of full plates – they cannot support a new task without another sliding off.  And drinking glasses have this same interesting property – when full, adding more water just gets the floor wet.

But for some reason we think people are different.  We think we can add tasks without asking about free capacity and still expect the tasks to get done.  What’s even more strange – when our people tell us they cannot get the work done because they already have too much, we don’t behave like we believe them.  We say things like “Can you do more things in parallel?” and “Projects have natural slow phases, maybe you can do this new project during the slow times.”  Let’s be clear with each other – we’re all overloaded, there are no slow times.

For a long time now, we’ve told people we don’t want to hear no.  And now, they no longer tell us.  They still know they can’t get the work done, but they know not to use the word “no.”  And that’s why the Slow No was invented.

The Slow No is when we put a new project on the three year road map knowing full-well we’ll never get to it.  It’s not a no right now, it’s a no three years from now.  It’s elegant in its simplicity.  We’ll put it on the list; we’ll put it in the queue; we’ll put it on the road map.  The trick is to follow normal practices to avoid raising concerns or drawing attention.  The key to the Slow No is to use our existing planning mechanisms in perfectly acceptable ways.

There’s a big downside to the Slow No – it helps us think we’ve got things under control when we don’t.  We see a full hopper of ideas and think our future products will have sizzle.  We see a full road map and think we’re going to have a huge competitive advantage over our competitors. In both situations, we feel good and in both situations, we shouldn’t.  And that’s the problem. The Slow No helps us see things as we want them and blocks us from seeing them as they are.

The Slow No is bad for business, and we should do everything we can to get rid of it.  But, it’s engrained behavior and will be with us for the near future.  We need some tools to battle the dark art of the Slow No.

The Slow No gives too much value to projects that are on the list but inactive.  We’ve got to elevate the importance of active, fully-staffed projects and devalue all inactive projects.  Think – no partial credit.  If a project is active and fully-staffed, it gets full credit.  If it’s inactive (on a list, in the queue, or on the road map) it gets zero credit.  None.  As a project, it does not exist.

To see things as they are, make a list of the active, fully-staffed projects. Look at the list and feel what you feel, but these are the only projects that matter.  And for the road map, don’t bother with it.  Instead, think about how to finish the projects you have.  And when you finish one, start a new one.

The most difficult element of the approach is the valuation of active but partially-staffed projects.  To break the vice grip of the Slow No, think no partial credit. The project is either fully-staffed or it isn’t   And if it’s not fully-staffed, give the project zero value.  None.  I know this sounds outlandish, but the partially-staffed project is the slippery slope that gives the Slow No its power.

For every fully-staffed project on your list, define the next project you’ll start once the current one is finished.  Three active projects, three next projects.  That’s it.  If you feel the need to create a road map, go for it.  Then, for each active project, use the road map to choose the next projects.  Again, three active projects, three next projects.  And, once the next projects are selected, there’s no need to look at the road map until the next projects are almost complete.

The only projects that truly matter are the ones you are working on.

Image credit – DaPuglet

Additive Manufacturing (AM) is technology/product space with ever-increasing performance and an ever-increasing collection of products. There are many different physical principles used to add material and there are a range of part sizes that can be made ranging from micrometers to tens of meters.  And there is an ever-increasing collection of materials that can be deposited from water soluble plastics to exotic metals to specialty ceramics.

But AM tools and technologies don’t deliver value on their own.  In order to deliver value, companies must deploy AM to solve problems and implement solutions.  But where to start? What to do next? And how do you know when you’ve arrived?

To help with your AM journey, below a maturity model for AM.  There are eight categories, each with descriptions of increasing levels of maturity.  To start, baseline your company in the eight categories and then, once positioned, look to the higher levels of maturity for suggestions on how to move forward.

For a more refined calibration, a formal on-site assessment is available as well as a facilitated process to create and deploy an AM build-out plan.  For information on on-site assessment and AM deployment, send me a note at mike@shipulski.com.

Execution

1. Specify AM machine – There a many types of AM machines. Learn to choose the right machine.
2. Justify AM machine – Define the problem to be solved and the benefit of solving it.
3. Budget for AM machine – Find a budget and create a line item.
4. Pay for machine –  Choose the supplier and payment method – buy it, rent to own, credit card.
5. Install machine – Choose location, provide necessary inputs and connectivity
6. Create shapes/add material – Choose the right CAD system for the job, make the parts.
7. Create support/service systems – Administer the job queue, change the consumables, maintenance.
8. Security – Create a system for CAD files and part files to move securely throughout the organization.
9. Standardize – Once the first machines are installed, converge on a small set of standard machines.
10. Teach/Train – Create training material for running AM machine and creating shapes.

Solution

1. Copy/Replace – Download a shape from the web and make a copy or replace a broken part.
2. Adapt/Improve – Add a new feature or function, change color, improve performance.
3. Create/Learn – Create something new, show your team, show your customers.
4. Sell Products/Services – Sell high volume AM-produced products for a profit. (Stretch goal.)

Volume

1. Make one part – Make one part and be done with it.
2. Make five parts – Make a small number of parts and learn support material is a challenge.
3. Make fifty parts – Make more than a handful of parts. Filament runs out, machines clog and jam.
4. Make parts with a complete manufacturing system – This topic deserves a post all its own.

Complexity

1. Make a single piece – Make one part.
2. Make a multi-part assembly – Make multiple parts and fasten them together.
3. Make a building block assembly – Make blocks that join to form an assembly larger than the build area.
4. Consolidate – Redesign an assembly to consolidate multiple parts into fewer.
5. Simplify – Redesign the consolidated assembly to eliminate features and simplify it.

Material

1. Plastic – Low temperature plastic, multicolor plastics, high performance plastics.
2. Metal – Low melting temperature with low conductivity, higher melting temps, higher conductivity
3. Ceramics – common materials with standard binders, crazy materials with crazy binders.
4. Hybrid – multiple types of plastics in a single part, multiple metals in one part, custom metal alloy.
5. Incompatible materials – Think oil and water.

Scale

1. 50 mm – Not too large and not too small. Fits the build area of medium-sized machine.
2. 500 mm – Larger than the build area of medium-sized machine.
3. 5 m – Requires a large machine or joining multiple parts in a building block way.
4. 0.5 mm – Tiny parts, tiny machines, superior motion control and material control.

Organizational Breadth

1. Individuals – Early adopters operate in isolation.
2. Teams – Teams of early adopters gang together and spread the word.
3. Functions – Functional groups band together to advance their trade.
4. Supply Chain – Suppliers and customers work together to solve joint problems.
5. Business Units – Whole business units spread AM throughout the body of their work.
6. Company – Whole company adopts AM and deploys it broadly.

Strategic Importance

1. Novelty – Early adopters think it’s cool and learn what AM can do.
2. Point Solution – AM solves an important problem.
3. Speed – AM speeds up the work.
4. Profitability – AM improves profitability.
5. Initiative – AM becomes an initiative and benefits are broadly multiplied.
6. Competitive Advantage – AM generates growth and delivers on Vital Business Objectives (VBOs).

Image credit – Cheryl

If you want to gain ground on your competition you’ve first got to know where things stand.  Where are their advantages? Where are your advantages?  Where is there parity? To quickly understand the situations there are three tricks: stay at a high level, represent the situation in a clear way and, where possible, use public information from their website.

A side-by-side comparison of the two companies’ products is the way to start.  Create a common set of axes with price running south to north and performance (or output) running west to east.  Make two copies and position them side-by-side on the page – yours on the left and theirs directly opposite on the right.  Go to their website (and yours) and make a list of every product, its price and its output. (For prices of their products you may have to engage your sales team and your customers.) For each of your products place a symbol (the company logo) on your performance-price landscape and do the same for their products on their landscape.  It’s now clear who has the most products, where their portfolio outflanks yours and where you outflank them.  The clarity and simplicity will help everyone see things as they are – there may be angst but there will be no confusion and no disagreement. The picture is clear.  But it’s static.

The areal differences define the gaps to close and the advantages to exploit.  Now it’s time to define the momentum and trajectories of the portfolios to add a dynamic element. For your most recent product launch add a one next to its logo, for the second most recent add a two and for the third add three. These three regions of your portfolio are your most recent focus areas. This is your trajectory and this is where you have momentum.  Extend and arrow in the direction of your trajectory.  If you stay the course, this is where your portfolio will add mass. Do the same for your competitor and compare arrows.  You know have a glimpse into the future. Are your arrows pointing in the same directions as theirs? Are they located in the same regions? How would feel if both companies continued on their trajectories? With this addition you have glimpse into the stay-the-course future.  But will they stay the course? For that you need to look at the patent landscape.

Do a patent search on their patents and applications over the previous year and represent each with its most descriptive figure. Write a short thematic description for each, group like themes and draw a circle around them.  Mark the circle with a one to denote last year’s patents.  Repeat the process for two years ago and three years ago and mark each circle accordingly.  Now you have objective evidence of the future.  You know where they have been working and you know where they want to go. You have more than a glimpse into the future.  You know their preferred trajectories.  Reconcile their preferred trajectories with their price-performance landscapes and arrows 1, 2 and 3.  If their preferred trajectories line up with their product momentum, it’s business as usual for them.  If they contradict, they are playing a different game.  And because it takes several years for patent applications to publish, they’ve been playing a new game for a while now.

Repeat the process for your patent landscape and flop it onto your performance-price landscape.  I’m not sure what you’ll see, but you’ll know it when you see it.  Then, compare yours with theirs and you’ll know what the competitive landscape will look like in three years. You may like what you see, or not.  But, the picture will be clear. There may be discomfort, but there can be no arguments.

This process can also be used in the acquisition process to get a clear picture a company’s future state.  In that way you can get a calibrated view three years into the future and use your crystal ball to adjust your offer price accordingly.

Image credit – Rob Ellis