Want to step up R&D productivity and your product launch success rate? Then get your development teams right.
Want to step up R&D productivity and your product launch success rate? Then get your development teams right.
by Dave Breda
Whether you’re into baseball or not, you can’t help but appreciate the simplicity of a baseball team. Each player’s role is clear, and teams have a well-defined structure that hasn’t changed since the game was conceived in the late 1800’s. Perhaps that structure isn’t so surprising. Major League Baseball is roughly a $10B a year business, and the dynamics of the team serve as the centerpiece of any franchise’s success. As such, teams are assembled with painstaking standards using quantitate, economic, and observed performance methods.
What’s baffling to me is the same could not be said about teams in corporate America. Consider that we spent approximately $514B on research and development in the U.S. last year. Then consider that in my 20 years as a consultant to dozens of corporations, I’ve witnessed no industry standards for developing teams.
But just like in professional sports, corporate teams matter a great deal – and while industry standards for teams don’t exist, several proven best practices do.
Our experience is that time-to-market, R&D productivity, and product launch success can be measurably improved 20 – 40% simply by structuring teams more effectively.
Why Product Launch?
If you are going to implement standards for your teams, perhaps the best place to start is the team’s function. I’ve chosen the term “Product Launch” carefully. It could easily have been “Product Development” or “Project Management.” Though the differences in these names might seem unimportant, the implications are enormous.
Product Development teams often disband when the product makes it through development, so they tend to overlook critical go-to-market activities. Project Management teams overly focus on schedule performance and tradeoffs between time, cost, and quality of the project. And they often assume marketing is managing the go-to-market execution.
Changing the function to “Product Launch” implies teams should have full responsibility for the product from concept through launch. That means they should have complete, but bounded, decision-making authority for how the product is defined, developed, tested, and brought to market. The inclusion of product and market readiness avoids unnecessary functional handoff. It also ensures critical downstream tasks are being accomplished earlier in the development cycle and with the appropriate cross-functional inputs.
A common flaw within the function of teams is that they assume the role of the primary communications channel for the product development and launch effort. Product Launch teams can and should certainly play a role in facilitating good communication, but they are an ineffective communications medium by themselves. This flaw is magnified as teams get larger in size. More team members create more communications links that must be maintained2. A small team of 7 people has 21 communication links to maintain, a larger group of 12 has a staggering 66 links to maintain!
I have worked with too many teams whose chief concern is that they spend more time reporting status than making status. There are more effective communications channels and tools that should be deployed, leaving the primary role of decision-making and market readiness to the Product Launch team.
Teams designed with productivity and time-to-market in mind pay close attention to size and composition. There have been numerous studies on team size and effectiveness (i.e., productivity) so I won’t reproduce the logic here. Suffice it to say, if your teams are consistently larger than 10 members, you likely have a size issue. If your organization perennially debates team size but teams are consistently less than 10, then you are probably wasting time. More important factors should govern team size and composition.
The gold standard for team size is to have the smallest team possible that includes the major stakeholder organizations in the product development and launch process. For high-tech companies, the diagram to the right is a good starting point for functional representation and team size.
It’s important to note the distinction between the Product Launch team and the Extended team. The Product Launch team is a small, decision-making team with overall responsibility for the product. The Extended team is a collection of resources and subject matter experts that accomplish the day-to-day workload of the project and are not formally part of the Product Launch team.
This team relationship allows a single Product Launch team to take a product from concept through development and market launch. For example, the Marketing Product Launch team member will rely on resources from the extended product management team through definition and development. As the project gets closer to launch, Marketing will rely more heavily on the contributions of marketing communications, sales, and channel management to prepare the market for launch. Similarly, the Product Development Product Launch team member would rely on design, engineering, and test initially. He or she would rely more heavily on sustaining engineering later in the development cycle to implement a post-launch plan for annual product cost reductions.
Other Factors to Consider
Several functions have been intentionally left out of the Product Launch inner circle: sales, legal, and various disciplines of engineering such as electrical, software, silicon, and mechanical. Many of these secondary functions can be represented on the extended team.
By employing a few tricks, team size can be controlled while extending coverage to all functions. For example, the Product Development Product Launch team member (if chosen carefully) can represent all engineering functions. Likewise, Finance can often represent Legal for industries that are not government regulated. Team size is an important consideration; however, there are several other attributes that do significantly impact team performance:
Years of experience of specific team members
Collaborative experience on prior efforts
The temperament of individual team members
The physical location of a Product Launch team also deserves some consideration for multinational companies. Colocation, the old gold standard, is no longer realistic since team members will likely reside in Europe, Asia, and Latin America. As was the case with the number of team members, there is an exponential relationship between the number of sites and complexity of coordination and communication. “Defragging” teams to get to the least number of sites represented is worth the time and effort as it will measurably reduce complexity. We advocate no more than 3 locations represented on Product Launch teams.
Perhaps the most important team staffing appointment is that of the team leader. No other member can influence the performance of the team like team leaders, so careful selection is worth the investment.
We advocate a weightier role for the team leader. Going back to our baseball analogy, we believe this role could most accurately be described as a “mini general manager (GM).” The team leader must effectively guide a cross-functional group through a myriad of decisions involving product definition, functionality, launch schedule, quality, profitability, compliance, and lifecycle management. In this role, team leaders perform nearly the same function as a GM, albeit on a smaller scale. A nice byproduct of this approach is that it has proven to be an effective development path for future organizational leaders.
The Product Launch team works exceptionally well when new products are started on this framework from the beginning – in the product inception or ideation phase. But what about programs that are already underway?
Successfully changing to this framework is possible if the cut-over plan for teams is taken on a case- by-case basis. Restructuring in-flight teams will almost always create a disruption. The earlier the cut-over, the less disruption is created. A good rule-of-thumb is that teams can be restructured successfully to the Product Launch team format if the restructuring is finalized before product definition is completed (i.e., after product requirements are approved and before significant development has begun).
Organizations can take advantage of the Product Launch team framework after this point, but it will likely require creating a separate Product Launch team that works with the existing development team. This two-team structure prevents any disruption to the development cycle while allowing the second team to ramp-up and prepare for market readiness and product launch.
Getting structure and roles right will vastly improve your team performance. However, to develop world-class performance, chemistry of the individuals has to become a standard criterion when appointing teams.
The notions of personality and temperament types are more than 2,000 years old, and business schools still include the subject matter in their graduate-level organizational behavior curricula. But this knowledge base is rarely incorporated into the real-world design of teams. This is an enormous missed opportunity. Temperament assessments are easily accessible, relatively inexpensive, and quick. An entire team can be assessed with detailed results in less than an hour.
Incorporating temperament into the design of teams helps on at least three levels. First, from a diversity and team strength standpoint, it helps to ensure teams have an ideal balance of types, including thinkers, planners, architects, leaders, mediators, entrepreneurs, and logisticians. Second, team member awareness of temperament types helps them understand that each type brings value and uniqueness to the team, which in turn helps individuals communicate and cooperate on a much more effective level. Third, your new product will be likely purchased by a whole spectrum of people representing different personality types. Doesn’t it make sense to staff your team with the same representation? Incorporating all these principles into Product Launch teams will generate big product launch returns. Many organizations are anxious to get product development started, so they rush into product development team appointments.
We encourage you to try making some of these changes on a single pilot team, where you can perform a side-by-side comparison with existing team structures. You’ll be anxious to cut-over to the Product Launch team framework after seeing the measurable results.
About Accel Management Group
Accel Management Group, Inc., helps high-technology companies improve performance in product development, manufacturing, and supply chain operations. Accel has worked with a range of companies from startups to the Fortune 500. Their work includes transformative projects with leaders within life sciences, computer and peripherals, software, telecommunications, electronics, consumer products, and general manufacturing. Accel has offices in San Diego, Denver, Orange County, and the San Francisco Bay Area.
About the Author
Dave Breda has over 20 years of strategy development and implementation experience driving breakthrough improvements with global technology companies. His expertise includes a broad range of business management areas including profitability improvement and cost reductions, innovation, product, and platform strategy, portfolio and product-line management, technology management, and operations governance. Prior to joining Accel Management Group, Mr. Breda was a partner with PRTM where he was the world-wide partner lead for the Computers, Networking, and Semiconductor group. Mr. Breda earned is Engineering Degree from the University of Colorado and his MBA degree from the Darden School at the University of Virginia. He is CPIM certified.
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