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The Product Development Management Association (PDMA) is an organization devoted to enabling companies improve their innovation processes and profitability through best demonstrated practices. It’s been around for awhile now and good research exists on the site (www.pdma.org).


Strong Innovation Drives Superior Organizational Profitability
Primary among the findings of several large studies is that Market Research, i.e. focus groups, sales anecdotal evidence and VoC – proves critical to the success AND profitability of a launch. This actually speeds (rather than delays) innovation from concept through introduction to market. While lauding the rewards of adherence to process and controls, it also warns of rogue mentality as a drain to profitability and causing significant disruptions in development, integrity in design and cost containment efforts.

Consider the following finding from an APQC study in 2003 and corroborated in Improving New Product Development Performance and Practices, by Cooper and Kleinschmidt in the same year:

Best Performers consistently realized superior performance in profitability, meeting sales and profit objectives, time efficiency, and opening new opportunities in markets.

Company profitability is superior – overall – in these organizations. Furthermore, lack of process on the front end suggests a failure rate as high as 3x as evidenced in “poor performers”.

The Importance of Culture in Transformation
Culture plays a significant role in either personal or organizational transformation. Don Berwick’s Escape Fire: Lessons for the Future of Healthcare, provides poignant insight in support of his supposition that organizations do not change without a ‘burning platform’. Consider the current state of your organization. Does your organization or Team yaw in the winds of shifting priorities and urgency ascribed to everything (hence applied to nothing)? If we remain reactive, not mindful; siloed, not integrated; you should anticipate increasing threats against core business and risk fighting an attrition strategy on numerous fronts. Organizations must evolve. It is imperative to shift from a transactional mindset to one of uncovering the needs of our customers and designing solutions that go beyond addressing those mean needs, and aim in delighting end-users. The outlook must become “solution-oriented” and always “customer-centric”.

Consequences exist as much for inaction as for continued adherence to behaviors that do not drive growth. Change is imperative for the future success and growth of any organization. The chance to choose does not exist. Success requires risking failure and embracing opportunities that kindle imagination, stretch our Teams and ask everyone to go beyond their existing reality. To continue in pursuit of modest growth figures seems a flawed approach. Most dream of million dollar concepts against incremental improvements. Innovators are right now conceiving and designing billion dollar programs. I assure you, those that reach beyond their grasp are fulfilled if not always satisfied.

Paradigms shift imperceptibly at first.  In your drive for simplicity and transparency, you will likely find collaboration, flexibility and responsiveness of Teams improve. Please be patient and remain communicative. Transformational events are often unpleasant to go through. It needs a catalyst (the “burning platform”) and requires us to withstand pressure, heat and time until we emerge.

If you have not looked for flames above the tree line, this might be a good time.

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Black Diamond Transformation, LLC

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