Republished from The Every Day Innovator Podcast for Product Managers by Chad McAllister
How product managers can turn a marathon into a sprint
Many medium to large organizations are adopting agile practices, such as the use of Scrum. Some are having more success with the adoption than others. Most of these organizations are also using some form of stage and gate process for the development of new products. When done right, stage & gate reduces risk, reduces time to market, and increases the return on innovation investment. For the more than 80 percent of U.S. companies using stage & gate, the idea of replacing it with agile is often not warmly embraced. Instead, a hybrid agile stage and gate process is a more reasonable place to start.
My guest, Colin Palombo, has been helping organizations using stage-gate to move to a hybrid agile stage & gate process and enjoying many benefits for doing so while keeping the framework they are familiar with. It’s a win-win. Colin is a managing partner and co-founder of two innovation consulting firms — Innovation Framework Technologies and Bizmotion.
I met Colin at the annual PDMA conference and enjoyed his insights for making stage and gate more agile. I hope you do as well.
Summary of some concepts discussed for product managers
[2:34] What is agile and what is stage-gate?
Stage & gate is an approach for developing new products across industries. It involves breaking down development into stages that are marked by gated decision points. It is designed to eliminate weak products along the way and decrease time to market. Agile is a project management approach for dealing with projects that have high degrees of uncertainty. Stage & gate projects can be managed using agile, or using other project management methodologies.
[5:42] Why are organizations taking a hybrid approach?
Traditional stage & gate is managed like a waterfall process, which doesn’t work well when markets and technologies are changing quickly. The process has become too slow and out of date. By applying agile, companies are hoping to create products that keep pace with customer needs. Agile allows product teams to course correct throughout the development process. while reducing time to market up to 20 percent. Agile also leads to higher team morale and better aligns with digital products and physical/digital product hybrids.
[11:00] How do you set up a hybrid process?
Most companies who have physical products want to implement agile processes but don’t know how to do it. We’ve created 10 steps based on our work over the past year — a mix of organizational and tactical aspects. On the tactical side, you still have stages but each stage has a sprint or a number of sprints. A sprint is a fixed period of time in which you seek to accomplish a set of tasks. You can determine how many sprints each stage will have, which creates a fixed timeline using an agile methodology. Agile also eliminates the paperwork associated with stage gate meetings; work is demonstrated by outcomes instead of words written in a document. Teams spend time gathering stories and data about the deliverables rather than creating PowerPoint presentations and filling out forms.
[17:19] What do the stages of product development look like in an agile approach?
Agile requires a shift in thinking to minimum viable product and an accelerated timeline. If a sprint is 10 days long, you have 26 sprints in a calendar year. The first stage becomes concept instead of scoping; think of what you can do within three sprints. What can you deliver to show people the product you want to make? Stage two becomes simulation instead of a business case. It could be 3D printing or CAD; anything to show your product without physically producing a prototype. The third stage becomes pilot instead of development. This gives you a physical product to begin understanding things like fulfillment and intellectual property. The fourth stage becomes scale up instead of validation. You’re getting sales channels ready and scaling up for official launch.
[22:13] How long should this process take?
You should be able to get through the first four stages in 26 sprints, or 52 weeks. You could spend 4 sprints on concept, 6 on simulation and 10 on pilot, which gives you 30 days for scale up and launch. All along the way, you’re running experiments to gauge customer reaction and gather data to inform the rest of your work.
[25:19] How does an agile approach change the team dynamic?
One of the biggest obstacles for agile adoption is product teams. In traditional product development, people are assigned to more than one project at a time, which means they are spread thin and have to multi-task. It’s a fallacy to think that this increases productivity. One of the key tenants of agile is dedicated teams to increase focus and ensure learning is passed from stage to stage. A core team should be at least 50 percent dedicated to the product at hand, otherwise the agile/stage & gate hybrid will not work.
“Our success at Amazon is a function of how many experiments we can do…Step by step.” – Jeff Bezos