Open Innovation Approaches at Different Stages of the Innovation Process. Suitability for New Product Development Processes


Master's Thesis, 2019

79 Pages, Grade: 1,3


Excerpt

Table of Contents

Table of Contents

Table of Figures

List of Abbreviations

1 Introduction
1.1 Problem Statement
1.2 Research Question
1.3 Conceptual Framework

2 Theoretical Framework
2.1 The Concept of Innovation
2.1.1 Definition of Innovation
2.1.2 Innovation Indicators
2.2 Innovation Process
2.2.1 Origin and Development of the Stage-Gate Process
2.2.2 Process Components
2.2.3 Evolution of the Stage-Gate System
2.2.3.1 Third-Generation Process
2.2.3.2 Next-Generation Stage-Gate System
2.2.4 Next-Generation Idea-to-Launch System
2.3 Open Innovation
2.3.1 The Closed Innovation Paradigm
2.3.2 The Open Innovation Paradigm
2.3.3 Enablers and Obstacles
2.3.4 Types of Open Innovation
2.3.4.1 Inside-Out Process
2.3.4.2 Outside-In Process
2.3.4.3 Coupled Process

3 Combination of Conceptual Findings
3.1 State of Research
3.2 Application of Selected Open Innovation Approaches at Different Stages of the Innovation Process
3.2.1 Discovery: Idea Generation
3.2.2 Stage 1: Idea Scoping
3.2.3 Stage 2: Build Business Case
3.2.4 Stage 3: Development
3.2.5 Stage 4: Testing and Validation
3.2.6 Stage 5: Launch
3.3 Summary and Evaluation of Findings
3.3.1 Out-Licensing or Selling IP
3.3.2 Customer Involvement
3.3.3 Supplier Involvement
3.3.4 In-Licensing or Buying IP
3.3.5 Alliances with Universities
3.3.6 Alliances with Competitors

4 Conclusion
4.1 Theoretical and Managerial Implications
4.2 Conditions and Limitations
4.3 Further Research Potential

Appendix

References

Table o f Figures

Figure 1 – Overview of the Stage-Gate Systems. 9

Figure 2 – Third-Generation Process.. 13

Figure 3 – Next-Generation Stage-Gate 14

Figure 4 – Spiral Development... 15

Figure 5 – Next-Generation Idea-to-Launch System. 17

Figure 6 – Knowledge Landscape in the Closed Innovation Paradigm 20

Figure 7 – Knowledge Landscape in the Open Innovation Paradigm... 22

Figure 8 – Three Archetypes of Open Innovation Processes. 25

Figure 9 – Suitability of Selected Open Innovation Approaches at Different Stages of the Innovation Process 53

List of Abbreviations

Abbildung in dieser Leseprobe nicht enthalten

1 Introduction

The following chapter portrays an introduction to the research focus of this work. By illustrating the challenges of volatile and fast changing industries, the necessity of detailed examinations is to be derived. Hereafter, the research question as well as the objectives of this work are elaborated. The depiction of the conceptual framework concludes the chapter.

1.1 Problem Statement

In the wake of globalization and digitization trends, entire industrial dynamics have transformed (Biggiero, 2006). Particularly product innovation management has significantly matured over the past decades and, therefore, gained special attention (Durisin, Calabretta & Parmeggiani, 2010). Manufacturers are nowadays able to serve regional as well as international markets, while taking advantage of distributed resources and expertise (Srai et al., 2016). On the downside, firms are steadily confronted by two predominant challenges: First, lead times for launching new products are dramatically decreasing due to shortened product life cycles. Hence, development projects need to be well-structured and more time-efficient. Secondly, sophisticated knowledge and expertise evolve more rapidly. Consequently, industrials become more specialized in subfields, which forces manufacturers to engage with others to carry out development projects (Edmondson & Nembhard, 2009).

In order to stay competitive in international and fast changing markets, organizations are required to innovate on a regular basis. Though, innovation development has become increasingly challenging and frustrating. New products are supposed to generate higher sales, while revenue margins are decreasing at the same time (Bharadwaj & Menon, 2000). Even successful corporations cannot keep up with regularly launching highly performing innovations. Therefore, many manufacturers rather focus on incremental product improvements instead of developing radical innovations (Pisano, 2015). Particularly as a company grows, the obstacles of launching successful new products become even more difficult to overcome. Simultaneously balancing the needs of new and existing customers as well as discovering new business lines, while pursuing extant business models portray omnipresent struggles of leading firms (Ries, 2011).

Though most companies define their overall business strategy and how different divisions will support it, hardly as many consider how their innovation efforts can be aligned with their strategy (Pisano, 2015). Yet, for succeeding in highly competitive markets and creating beneficial value from innovations, the development of a suitable innovation strategy is imperative (Christensen, 2002; de Brentani, Kleinschmidt & Salomo, 2010). Specifically, by addressing challenges and opportunities, new product development strategies are directly linked to a manufacturer’s short- and long-term performance (de Brentani, Kleinschmidt & Salomo, 2010).

1.2 Research Question

As discussed, the development of a suitable innovation strategy verifiably improves a firm’s innovation performance. Yet, its preparation requires the consideration of market challenges and opportunities (de Brentani, Kleinschmidt & Salomo, 2010). More efficient development processes are the result of decreasing life cycles and international competition (cf. Edmondson & Nembhard, 2009). Thus, structured approaches for conceptionally moving a new product from idea to launch have gained significant interests both in academia and practice (e.g. Cooper, 1990; 2014), particularly for incremental innovation developments (cf. Bianchi, et al., 2019). Moreover, as knowledge distribution forces firms to actively engage with others (Edmondson & Nembhard, 2009), firms have started intentionally opening-up their innovation processes (Chesbrough, 2003a). Thus far, scholars have concentrated on different initiatives for improving a firm’s innovation process and the exploration or exploitation of distributed knowledge in separate manners (Cooper, 2019).

Consequently, the objective of this thesis is to offer a combined research-based approach for improving new product development processes by means of exchanging proficiencies with externals. More accurately, a critical assessment of the suitability of selected open innovation methodologies at different stages of the innovation process enhances the research focus of this thesis. The research question therefore states: “For which stages of the innovation process are selected open innovation approaches suitable?”

1.3 Conceptual Framework

The theoretical framework consists of three conceptual and correlated constructions that lay the foundation for further elaborations. The literature review is therefore introduced by an illustration of the general conception of innovation. Precisely, relevant definitions, implications as well as innovation indicators are in need for exemplifications. Hereafter, the origin and development of a structured new product development process, the ‘Stage-Gate Systems’, are to be elaborated. Subsequently, two expedient model alterations, namely the ‘Third-Generation Process’ and ‘Next-Generation Stage-Gate System’, are illustrated. Based on the assumptions of its predecessors and further state-of-the-art adjustments, the framework of the ‘Next-Generation Idea-to-Launch System’ is outlined, which offers a suggestive skeleton for managing new product developments. The portrayal of the transition from an originally Closed Innovation (CI) Paradigm to a more open conception of innovation development serves as an introduction to a broader presentation of the Open Innovation (OI) Paradigm. Consequently, associated internal as well as external enablers and obstacles are to be delineated. The adjacent identification of three different types of practicing OI ensures the differentiation of underlying and commonly used approaches. A detailed description of each of the selected approaches concludes the theoretical framework.

The ensuing chapter combines theoretical assumptions of the Next-Generation Idea-to-Launch System with the characteristics of stated OI approaches. Consequently, a deductive discussion states out the implications of applying each approach at different stages of the innovation process. A subsequent critical evaluation of findings allows the derivation of their respective suitability for implementation and, thereby, enlarges upon the research focus of this thesis.

The final chapter summarizes expedient findings by elaborating theoretical and managerial implications of the research. Hereafter, underlying limitations and conditions are to be demonstrated. An outlook of further research potential completes the chapter.

2 Theoretical Framework

The following chapter summarizes two theoretical models, which lay the groundwork for the subsequent combination of conceptual findings. In order to exemplify the general concept of innovation, terminologies, implications and indicators are to be illustrated. Hereafter, the first theoretical model can be introduced by outlining the foundation of a formal innovation process, precisely the ‘Stage-Gate Systems’. The illustration of further and more sophisticated model alterations disembogues in the depiction of a more recent new product development skeleton, the ‘Next-Generation Idea-to-Launch System’. The ‘OI Paradigm’ represents the second theoretical model of this work. Therefore, the transition from an initially ‘CI’ approach to a more open perspective on innovation management is to be displayed. Subsequently, a distinction between different types of OI, namely ‘inside-out’, ‘outside-in’ and a ‘coupled’ methodology can be elaborated. Adjacent in-depth delineations of respective underlying approaches complete the theoretical framework.

2.1 The Concept of Innovation

The following subchapter adumbrates the conception of innovation and underlying assumptions. Therefore, the origin of innovation as well as its primordial and modern definitions are to be illustrated. The ensuing portrayal of innovation indicators finalizes a first theoretical introduction, which lays the foundation for further supplementary elaborations.

2.1.1 Definition of Innovation

Due to a great variety of existing scientific definitions and interpretations of ‘innovation’ (e.g. Lusch & Nambisan, 2015; Ayhan et al., 2013), its use warrants exemplification. The term ‘innovation’ initially stems from the Late Latin noun ‘innovationem’, which seeks its origin in the mid 15th century and is firmly translated to ‘restoration’ or ‘renewal’ (Etymonline, 2018). In an organizational context, ‘innovation’ is defined as “the adaption of a change” (Knight 1967, p. 478) and comprises either an entirely new or substantially improved product, system, program, policy, service or process (Damanpour, Szabat & Evan, 1989; OECD, 2005). Although the terms ‘invention’ and ‘innovation’ are often used synonymously, they indeed differ regarding their implications (Chesbrough, 2003a). Whereas the former describes the output of innovation efforts within a firm, the latter combines invention with exploitation and, thus, comprises additional commercialization efforts (Roberts, 1998; Dewangan & Godse, 2014).

Within the boundaries of this thesis, innovation development primarily alludes to new product evolutions and therefore excludes other forms of innovations from further elaborations. Most product inventions are in fact ‘incremental’, i.e. slight improvements to existing products. Though, some inventions are considered ‘disruptive’ due to their high degree of novelty to a firm and its environment (Cooper, 2013). As soon as a new product is launched, the innovation is expected to sustain itself and return its proportional costs (Keeley et al., 2013). Nonetheless, organizations sometimes rather fortify their long-term competitive advantage instead of focusing on revenues generated by one single innovation (Holgersson, Grandstrand & Bogers, 2018).

2.1.2 Innovation Indicators

Despite the growing acknowledgement of strategic innovation development, the identification of promising inventions and the evaluation of their respective future impact remain difficult tasks to conduct (Kleinknecht, van Montfort & Brouwer, 2002). Particularly as the success rate of new product innovations is reportedly below 25 percent, researchers attempt to determine certain ‘indicators’ that hint at successful innovations early in their development process (Evanschitzky et al., 2012). In this context, an ‘indicator’ is defined as a “measured value that provides information about a […] status quo”, which can either directly or indirectly indicate an innovation’s quality (Dziallas & Blind 2018, p. 4). On the one hand, research and development (R&D) expenditures (Flor & Oltra, 2004), as well as the number of intellectual property (IP), precisely patents (Hagedoorn & Cloodt, 2002), merely indirectly evaluate an invention (Kleinknecht et al., 2002). On the other hand, though, the number of innovative ideas (Cooper & Kleinschmidt, 1993) and the product’s degree of novelty serve as direct indicators (Hagedoorn & Cloodt, 2002). In order to evaluate the innovation’s success after commercialization activities, firms sometimes make use of ‘output’ indicators (Kleinknecht, 1993), such as product performance, i.e. success rate and number of new product announcements (Dziallas & Blind, 2018).

The early detection and coherent evaluation of auspicious inventions is of significant importance due to a firm’s restricted availability of resources (Dewangan & Godse, 2014). Hence, their allocation needs to be well-grounded and reasonable. As an innovation project advances, the appraisal of indicators therefore supports the determination of whether to proceed with or disapprove an invention’s development. Consequently, by taking innovation indicators into consideration, an organization is able to make fast adjustments and focus on relevant and favorable projects. (Dzillias & Blind, 2018).

2.2 Innovation Process

The following chapter deals with the evolution of the ‘Next-Generation Idea-to-Launch System’, a formal and adapted framework for new product developments. Therefore, the origin and development of the underlying ‘Stage-Gate Systems’ are outlined, followed by a detailed depiction of the skeleton’s components and implications. The illustration of two successor models, namely the ‘Third-Generation Process and ‘Next-Generation Stage-Gate System’ lay the foundation for the subsequent elaboration of a more sophisticated framework, i.e. the ‘Next-Generation Idea-to-Launch System’.

2.2.1 Origin and Development of the Stage-Gate Process

In order to more efficiently manage product innovation processes, different approaches and skeletons have been developed over the past decades. The very first product development model was originated by the ‘National Aeronautics and Space Administration’ (NASA) in the 1960s. The so-called ‘Phased Review Process’ (PRP) was designed for collaboratively working with suppliers and other partners on space-related projects. The PRP divides the development process into different stages, with each followed by a respective review gate. At that time, only departments involved in the physical development of a product could participate, hence, marketers were excluded from the project. Though, due to a very narrow focus on technical capabilities, the processes turned out to be too functional. The product development slowed down significantly as projects started to queue at the gates while awaiting management reviews or were even put on hold. (Cooper, 1994).

By addressing the obstacles presented by the PRP, Cooper (1988) has designed a ‘second-generation’ tool for managing new product developments, i.e. the ‘Stage-Gate Process’ (Cooper & Kleinschmidt, 1986; Cooper, 1990; 1994). In contrast to its predecessor, the framework explicitly highlights marketing-related activities during the new product development process (Cooper, 1988). The assumptions drawn from the findings of a comprehensive study have laid the foundations of the first Stage-Gate model. Before conducting 123 interviews with various manufacturing firms, thirteen activities that are commonly executed during the innovation process have been identified: (1) The Idea, (2) Initial Screening, (3) Preliminary Market Assessment, (4) Preliminary Technical Assessment, (5) Market Research/ Detailed Market Study, (6) Business Financial Analysis, (7) Product Testing - In-House, (8) Product Testing with the Customer, (9) Test Market/ Trial Sell, (10) Trial Production, (11) Precommercialization Business Analysis, (12) Production Start-up and (13) Market Launch (e.g. Rothwell et al., 1974; Cooper, 1983) Within the scope of the inquiry, the participating corporations have disclosed insights about which activities are typically conducted during their respective innovation processes (Cooper & Kleinschmidt, 1986).

The results demonstrate that very few companies have undergone all thirteen stages (1.9%), whereas only about one third (33.7%) have carried out less than seven activities. However, the evaluations further show that the implementation of nine activities were positively related to the project’s outcome (Cooper & Kleinschmidt, 1986). Accordingly, successful projects are characterized by a more complete application of the new product development process. Vice versa, the more activities omitted, the higher the probability of product failure (Cooper, 1990). Yet, passing through all stages is not particularly expedient when it comes to line extensions or slight product improvements (Cooper & Kleinschmidt, 1986). A full process might even slow down low-risk projects as certain activities become dispensable, while at the same, do not add value to the process (Cooper, 1994). However, additional factors, such as the differential advantage of the product, the understanding of customer needs, beneficial market conditions and strong marketing efforts positively impact the new product’s success (Cooper & Kleinschmidt, 1986). Based on a combination of these assumptions and additional findings of previous research, Cooper (1988) has formulated a first formal concept of the Stage-Gate Process, which summarizes crucial activities into stages and gates.

2.2.2 Process Components

A process is typically defined as a “sequence of interdependent and linked procedures, which at every stage consume one or more resources to convert inputs into output” (Business Dictionary, 2018). Analogously, the Stage-Gate Process divides the innovation process into stages and gates, with each containing related and simultaneously performed activities. Cooper (1990) further argues that the best way to improve the process’ performance regarding its outcome is to concentrate on the process itself. Yet, the application of the model does not guarantee product success, it rather presents a road map for both conceptionally and operationally moving a product from idea to market launch (Cooper & Kleinschmidt, 1986; Cooper, 1988; 1990). Therefore, firms can manage their innovation process and keep up with the pressure of reducing cycle times, while potentially improving the product’s success rate. As the process model merely offers a generic skeleton, though, each firm is required to tailor it to their specific conditions and circumstances (Cooper, 1988).

Each project starts with an idea, followed by altering gates and stages until the invention is ready for launch. Gates or ‘control checkpoints’ are generally characterized by ‘inputs’, ‘exit criteria’ and an ‘output’. The ‘inputs’ are presented in the form of individually predefined deliverables brought to the gate. The ‘exit criteria’ are then defined, upon which the project will be evaluated before it enters the consecutive stage. Based on the deliverables and exit criteria, a decision on how to proceed with the project is made, which portrays the ‘output’ of each gate. These rulings typically contain either an approval for project procedure, final disapproval, hold or recycle approach, determined by ‘gatekeepers’. ‘Gatekeepers’ are generally represented by a group of senior managers, who are not only independent of the project but also authorized to decide about resource allocations and commitment efforts. The closer the invention moves to market launch, the heavier are stage-related expenditures. Consequently, the decisions on how to proceed with a project need to be thoroughly evaluated and based on accurate market observations and forecasts. Furthermore, the designated project leader takes responsibility for guiding the project from stage to stage and manages required inputs as well as the organization of the new product development team. (Cooper, 1988; 1990).

Even though the conceptual Stage-Gate Process considers marketing as well as production and technical activities during the development process, the involvement of other divisions has yet been neglected. Cooper (1990) has therefore designed a more elaborated conception, the so-called ‘Stage-Gate Systems’, which has become a frequently adapted skeleton (Cooper, 1990; 1994; 2014). The modified version of the second-generation framework contains a sample of five crucial stages and gates (see Figure 1) (Cooper, 1990).

Abbildung in dieser Leseprobe nicht enthalten

Figure 1 – Overview of the Stage-Gate Systems (Cooper 1990, p. 46)

Idea

Each innovation process is initiated by a new product idea (Cooper, 1990).

Gate 1: Initial Screen

A first decision on whether to proceed with the project is issued at the first gate, called ‘Initial Screen’. Accordingly, the necessary criteria need to be defined and classified into ‘should fulfill’ and ‘must fulfill’. Whereas financial criteria are not part of the consideration yet, the project’s fit with the firm’s overall strategy should be assessed. Moreover, available resources, the product’s attractiveness, its feasibility as well as the competitive advantage are evaluated. The development of a rating scale facilitates the weighing and ranking of exit criteria (Cooper, 1988; 1990).

Stage 1: Preliminary Assessment

After receiving the first approval for proceeding with the project, the idea enters the first stage of the process. The main objective is to determine a preliminary market assessment, containing the derivation of the market size, product potential and customer acceptance. By means of different inexpensive research activities, such as lead user interviews, the product’s market potential can be derived. Hereafter, the execution of a technical assessment allows assumptions about the product’s feasibility, manufacturing costs and required production time. (Cooper, 1990).

Gate 2: Second Screen

Analogically to the first gate, the status of the project is reviewed at the ‘Second Screen’ gate. In contrast, though, additional information have been gathered and the exit criteria have changed. The new ‘should fulfill’ criteria now concern the degree of customer acceptance, which can be derived by interpreting the results of the conducted interviews. In addition to the evaluation of the deliverables, a first calculation takes place in order to estimate the expected financial return of the project’s outcome. (Cooper, 1990).

Stage 2: Detailed Investigation (Business Case Preparation)

As soon as the invention meets the exit criteria, it moves to the second stage, which requires heavier spending than the previous one. Yet, before the new product enters the development stage, the product is defined and its market attractiveness needs to be assessed. Now, more extensive research is undertaken for appraising customer needs. Furthermore, competitive analyses as well as a concept testing are carried out. Based on the gained insights, a more developed preliminary design can be constructed and the product’s technical feasibility derived. Moreover, patent and copyright opportunities are in need for legal administration work. The derivation of operations estimations, including producibility, manufacturing costs and investments, supports the definition of the concept. In addition, a more sophisticated financial examination involves a cash flow as well as a sensitivity analysis and serves as the deliverable for entering the subsequent ‘Decision on Business Case’ gate. (Cooper, 1988; 1990).

Gate 3: Decision on Business Case

The third review gate requires a last evaluation of the project’s progress before even larger investments are at stake during the ‘Development’ stage. Thus, a critical financial analysis of the inquiry is crucial. The revision also involves an accurate examination of each activity undertaken during the second work station, including the quality of execution and outcomes. Furthermore, the definition of the product’s concept, its features, as well as a positioning strategy and customer benefits are determined. Eventually, a road map that contains an outline of the development process and preliminary operations, needs to be authorized before entering the consecutive stage. (Cooper, 1990).

Stage 3: Development

As an affirmative ruling on proceeding with the project was given, a first preliminary product can be developed. Apart from manufacturing efforts, more detailed marketing and operation plans are compiled during the third work station. Moreover, a financial update is conducted, while legal issues are resolved. (Cooper, 1988; 1990).

Gate 4: Post-Development Review

At the fourth review gate, i.e. ‘Post-Development Review’, the quality of the product development needs to be evaluated. In addition, based on more accurate information, the financial analyses are in need for adjustments. Further assessments of marketing and operation activities are followed by a ‘Go’, ‘Kill’ or ‘Recycle’ decision. (Cooper; 1990).

Stage 4: Testing and Validation

The viability of the product, its entire manufacturing process, as well as its profitability and customer acceptance are examined during the ‘Testing and Validation’ stage. Therefore, the product undergoes several in-house testings, user, production and sell trails. Consequently, the financial viability needs to be revised and adjusted according to the newly gained insights. (Cooper, 1990).

Gate 5: Pre-Commercialization Business Analysis

A final review at the fifth gate offers the last opportunity of disapproving the project’s procedure before market launch. Therefore, a critical examination of the quality of executed activities as well as an evaluation of the outcomes takes place. Ultimately, by means of assessing economical calculations, the operations and marketing plans are critically inspected and approved for application (Cooper, 1990).

Gate 5: Full Production & Market Launch

As the project arrives at the fifth and last review gate of the new product development process, marketing and operations plan are implemented and the invention becomes an innovation due to commercialization efforts (Cooper, 1988; 1990).

Post-Implementation Review

As soon as the innovation was launched, the product becomes part of a company’s product portfolio. At this point, the product’s performance needs to be tracked and evaluated based on costs, revenues, timing and returns. Moreover, the project’s execution quality is to be assessed in order to derive best practices and improvement potentials. (Cooper, 1990).

2.2.3 Evolution of the Stage-Gate System

The second-generation Stage-Gate model has laid the foundation of a sophisticated innovation process conception. Yet, due to market developments and feedback provisions of firms that have experienced the model’s strengths and weaknesses, several adapted frameworks have been developed over the past two decades. Despite innumerable alterations, within the scope of this thesis, the primary research focus will be on adjustments that have significantly contributed to the development of the ‘Next-Generation Idea-to-Launch System’, a more recent and elaborated framework. Therefore, the ‘Third-Generation Process’ and the ‘Next-Generation Stage-Gate Systems’ are to be illustrated in the following.

2.2.3.1 Third-Generation Process

The ‘Third-Generation Process’, the successor of the Stage-Gate System, has adopted towards four crucial F’s: (1) Fluidity, (2) Fuzzy gates, (3) Focused and (4) Flexible, for improving the performance of the new product development process (see Figure 2). Specifically, the modified framework combines traditional disciplines with the ability to realize project acceleration (Cooper, 1994).

Abbildung in dieser Leseprobe nicht enthalten

Figure 2 – Third-Generation Process (Following Cooper 1994, p. 5)

Firstly, the new approach concentrates on a more fluid and adjustable concept than its predecessor. Activities are not bound to certain stages, while the latter are not necessarily consecutive anymore. More precisely, activities that were formerly assigned to a certain stage can now be moved to up- or downstream work stations. Secondly, ‘Go’ decisions are rather conditional and situational instead of absolute. Thus, the project can move to a subsequent stage even if not all required activities have been carried yet. Though, the approval for procedure underlies the condition that the omitted tasks need to be executed until a predefined date or otherwise the project will be put on hold. Thirdly, the model focuses on more efficient resource allocations in order to assure their availability for auspicious projects. Consequently, all current projects need to undergo a critical evaluation regarding their estimated overall impact. Lastly, the new model is designed to be more flexible, hence, if certain tasks are slowing down the process, stage-related activities can be omitted. Specifically, the process is not defined by prescribed stages and gates anymore. Instead, a project’s uncertainties and associated risks determine what activities are crucial and which steps can be left out.

Although the application of the four F’s aims at improving the new product development process, the newly gained elasticity also comes with a higher likelihood of product failure. Hence, gatekeepers are required to be more experienced in handling the innovation process in order to assure that the project stays on track. Overall, the faster and smarter model provides a more tailored solution that is ready to adapt to a project’s specifics. However, due to overlapping and fuzzy stages, it has become more difficult to define the stage the project is currently at. Therefore, the allocation of project responsibilities need to be adjusted accordingly. Consistent with a more flexible approach, project leaders are granted much more authority to give a ruling, whereas senior managers increasingly rely on the project leader’s expertise. (Cooper, 1994).

2.2.3.2 Next-Generation Stage-Gate System

Due to the feedback generated by corporations that have applied the Second- and Third-Generation models, it has become apparent that some projects do not require a ‘full five stages and gates’ process. Instead, there is demand for shorter and adapted models, which has led to the development of two additional ‘Next-Generation Stage-Gate’ versions. Therefore, additional frameworks for small projects and those with moderate risks i.e. the ‘Stage-Gate XPress’ and the ‘Stage-Gate Lite’, respectively, have been designed (see Figure 3). (Cooper, 2008).

Abbildung in dieser Leseprobe nicht enthalten

Figure 3 – Next-Generation Stage-Gate (Following Cooper 2008, p. 12)

While the first stage, i.e. Idea Discovery, initiates the process for all three models, the subsequent number of stages and gates varies. For line extensions or small product improvements, the ‘Stage-Gate Xpress’ offers an adapted and comprised framework of merely three stages and gates. The XPress approach aggregates the first two stages into one single work station, called ‘Scope & Business Case’. Therefore, the project directly arrives at the third review gate before entering the ‘Development & Testing’ stage. As soon as the project receives an approval for proceeding to the fifth gate, i.e. ‘Go to Launch’ gate, the invention can be launched. (Cooper, 2008).

Yet, the ‘Stage-Gate Lite’ framework is more suitable for projects concerning marketing or sales-force inquiries and consists of only two stages and gates. Analogously to the other models, the skeleton schedules a project’s start with the discovery of an idea. After assessing all relevant criteria and receiving a ‘Go’, it enters the successive stage, a combination of stage one and two. At the only gate, i.e. ‘Decision to Execute’, gatekeepers review the project’s status before the invention moves to the final work station. If the project is perceived as suitable for development, the subsequent stages are summarized into one single and final stage, called ‘Execute: Develop, Test & Launch’. By developing frameworks for different kind of projects, smaller requests can undergo a shortened innovation process, which leads to significant cost and time savings. Though, the higher the risk of the project, the more attractive a full Stage-Gate process becomes. Regardless of which version appears to be most appropriate for application, the process’ capability to adapt is paramount. (Cooper, 2008).

Additionally, the conception of ‘Spiral Development’ integration emerges, which emphasizes the importance of constant customer feedback during stage two, three and four. Therefore, user needs and demands can be evaluated and applied to the product during the early stages of the development process. Figure 4 illustrates the procedures from gathering customer feedback to subsequent integration, based on a full Stage-Gate framework. (Cooper, 2008).

Abbildung in dieser Leseprobe nicht enthalten

Figure 4 – Spiral Development (Cooper 2008, p. 13)

In the beginning of the second stage, the ‘Voice of the Customer’ approach leads to a better understanding of potential product difficulties from a customer’s perspective. Therefore, the development team visits potential clients and evaluates their respective desires and demands. Based on the generated insights, a suitable concept, which either contains a virtual or even a raw physical prototype, can be set up. Regardless of the prototype’s shape, the invention is not supposed to be well-functioning at this early stage but rather serves as a two-dimensional presentation, accompanied by an informal overview sheet. The feedback generated after the prototype’s presentation is used to finalize the concept and its specifics. When approaching the third stage, a more sophisticated prototype can be developed. Subsequently, the project team once again seeks feedback from customers. The gathered insights are then translated and assimilated into the development process. As a result, a first fully functional prototype can be presented to potential clients. Ultimately, three iteration loops are taking place before the product moves to the fourth stage, during which another field test is carried out. The focus has now, more than ever before, shifted towards an elaborated and continuously improvement-seeking approach that actively integrates customers or users into the product development process. (Cooper, 2008).

2.2.4 Next-Generation Idea-to-Launch System

One of the most recent new product development approaches is the so-called ‘Next-Generation Idea-to-Launch System’ . Its adapted framework comprises expedient modifications and iterations of the model’s predecessors and therefore offers a skeleton that combines best practice assumptions. This new and leaner alteration is the response to fast changing customer needs and presents an even more time-efficient and dynamic model. The emphasize of the new system is on the adaption of its underlying ‘Triple-A’ characteristics: (1) Adaptive & Flexible, (2) Agile and (3) Accelerated (see Figure 5). (Cooper, 2014).

[...]

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Details

Title
Open Innovation Approaches at Different Stages of the Innovation Process. Suitability for New Product Development Processes
College
RWTH Aachen University
Grade
1,3
Author
Year
2019
Pages
79
Catalog Number
V540254
ISBN (eBook)
9783346153418
ISBN (Book)
9783346153425
Language
English
Tags
Innovation Management, Open Innovation, Innovation Process, Stage-Gate
Quote paper
Claudia Specht (Author), 2019, Open Innovation Approaches at Different Stages of the Innovation Process. Suitability for New Product Development Processes, Munich, GRIN Verlag, https://www.grin.com/document/540254

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