Your team regularly uncovers exciting new product opportunities that fit your technology and customers are hot to buy. Of course, if they don’t always fly through development and launch, it’s easy to think that not having enough people is the problem. Especially given the talent brain drain everyone is facing.
But what we really need to discuss is the real brain drain affecting new product growth. The pervasive habit of allowing too much work into development – guaranteed to sabotage the effectiveness of your talent and the speed and predictability of your new product pipeline.
The good news is that it’s a self-inflicted wound. And one that you can rapidly recover from.
Diagnosing the Problem
Want to know if you have too much WIP in manufacturing? Easy-peasy. Go to the Gemba and you’ll see parts stacked to the ceiling waiting to go through the bottleneck. But not so with new product development because it’s knowledge work. Most of the work is buried on individual PCs. But hidden as it is, the effect is dramatic and chaotic. So you need to look for the symptoms. If you are seeing projects taking longer than expected and fire drills to meet deadlines becoming routine, you have too many projects underway for your bandwidth.
Take an example where your team has the people to run four projects at full speed, but you allow six to run. It’s simple math— 6/4=1.5. Everything will take 50% longer. A one-year project will take you 18 months.
But it’s worse than that. You don’t just spread the people doing the work evenly across more projects. The real brain drain is the chaos of jumping back and forth between unfinished tasks to keep all the plates spinning. And even when you aren’t working on a project, it is still sapping part of your cognitive bandwidth.
If you have any doubts about the negative impact of multitasking, try it here with this test.
Bottom line. It ends up taking closer to twice as long as it needs to—so 2 years. Think about the impact of that.
- Fewer launches per period from the same number of people
- Longer time to market
But there are some less obvious hidden costs too.
- Lost cash flow – 1 year of cash flow from the 4 projects that you could have finished earlier – lost forever
- Poor visibility – People are so busy they don’t have time to report status and make updates
- Bad Future Projects – What happens when you ask someone who’s already too busy to evaluate a new opportunity? Do they have time to do that well?
- Burnt-out staff – Does anybody actually enjoy working this way? Can you afford to lose good people these days?
So what can you do to stop the brain drain in your new product pipeline?
The key is making the problem visible and then managing it. The simplest solution is a virtual drum. Figure out the maximum number of large projects you can handle without any undue stress or chaos. Set that as your WIP limit for the drum – the number of projects in execution. Then the rule is that one has to exit “the drum” for another to enter. But don’t confuse simple with ineffective. Companies I’ve helped to use this approach have dropped time to revenue by up to 60%.
To implement it in your company, work with folks across your organization and get agreement on the number of projects you can run at full speed. Then ruthlessly deny entry until a spot opens up. Takes discipline, but it works!
If you want to make gains like this, the easiest way to get started is to download our free AcceleTrak™ NPD Bandwidth Accelerator. An Excel template that refines the virtual drum approach to include project size/complexity and allows you to build a mini-portfolio. You can use it right away to see how loaded your portfolio is and then take action to accelerate your execution.
To your growth,