product generation a.k.a. product management
DESCRIPTION
Product Generation a.k.a. Product Management. Ken Homa. Product Generation. New Product Development Product / Process Linkage Product Line Management Branding Strategy. Product Life Cycle. Typical pattern, highly varied by product, geography Cash flow critical - PowerPoint PPT PresentationTRANSCRIPT
Product Generationa.k.a. Product Management
Ken Homa
Product Generation
New Product Development
Product / Process Linkage
Product Line Management
Branding Strategy
Product Life Cycle
• Typical pattern, highly varied…by product, geography
• Cash flow critical…Mature ‘lend’, growth ‘borrow’
• Manage the PLC…Differentiated tactics…Revitalization
““Owning a customers’ lifetime profitability Owning a customers’ lifetime profitability requires a full line that keeps competitors out. requires a full line that keeps competitors out. The incremental costs of line extensions are The incremental costs of line extensions are low & computers handle the complexity.” low & computers handle the complexity.”
Product Line MangementThe Issue
“Owning a customers’ lifetime profitability requires a full line that keeps competitors out. The incremental costs of line extensions are low & computers handle the complexity.”
““Pareto lives. Stay focused and simplify. Pick your Pareto lives. Stay focused and simplify. Pick your winning products and customers, bet big on them, winning products and customers, bet big on them, and be willing to walk away from some business.”and be willing to walk away from some business.”
Product Line MangementThe Issue
A broad product line is required to fully A broad product line is required to fully cover all (or most) customer / market cover all (or most) customer / market requirementsrequirements
...and to erect barriers from competition...and to erect barriers from competition.
Product Line ManagementThe Issue
A broad product line is required to fully cover all (or most) customer / market requirements
...and to erect barriers from competition.
But, complexity & costs increaseBut, complexity & costs increaseexponentially as product lines get longexponentially as product lines get long
Product Line ManagementThe Issue
Product Line Proliferation
• Size, color, pack
• Special & derivative models
• Accessories
• Ancillary products
• Multiple generations
Combinations & permutations ...
Power Tools
The evolution of a product line ...
DRILLS SAWS OTHER
Power Tools
DRILLS SAWS OTHER
PROFESSIONAL
CONSUMER
Power Tools
DRILLS SAWS OTHER
PROFESSIONAL
CONSUMERGOOD
BETTER
BEST
Power Tools
DRILLS SAWS OTHER
CO
RD
LES
S (
DC
)
CO
RD
LES
S (
DC
)
CO
RD
ED
(A
C)
CO
RD
ED
(A
C)
GOOD
BETTER
BESTPROFESSIONAL
CONSUMER
Power Tools
FEATURES
SIZES
COLORS
PACKS
Variable speedVariable speed
1/4”, 3/8”. 1/2” drills1/4”, 3/8”. 1/2” drills
Pro black DeWalt yellowPro black DeWalt yellow
Redistribution, KitsRedistribution, Kits
Power Tools
Strategic Models
Supplementary Brands
Complementary Products
Accessories
Global / Regional Models
Flagships, fighters, derivatives
Sub-brands, private label
Cordless tools, chargers
Drill bits, saw blades
110/240 V
Generational Recycling ...
Product Line ManagementBreadth & Depth of Line
Key : product line / item profitabilityKey : product line / item profitability
…Imprecise, but enlightening
Product Line ManagementBreadth & Depth of Line
Key : product line / item profitability
Each Each andand every every item has associated item has associated costs : some visible, some hiddencosts : some visible, some hidden
…Cannibalization…Inventory…Administration…Repair parts
Product Line ManagementBreadth & Depth of Line
Key : product line / item profitability
Each and every item has associated costs : some visible, some hidden
ParetoPareto isis alive, wellalive, well ... and... and applicableapplicable
… Rule of 80 / 20
Product line managementKeys to Success
Strive for shortest lineStrive for shortest line Treat incremental items as major decisions
Product line managementKeys to Success
Strive for shortest line
Watch for “line creep”Watch for “line creep”
Especially when new generations launched
Product line managementKeys to Success
Strive for shortest line
Watch for “line creep”
Prune aggressivelyPrune aggressively
Tie pay to line profitability
Product line managementKeys to Success
Strive for shortest line
Watch for “line creep”
Prune aggressively
Link product & process designLink product & process designMass customization
Design Elements
Technical EfficacyInnovation
Functionality
Ergonomics
Aesthetics
Manufacturability
Design Elements
Technical EfficacyInnovation
Functionality
Ergonomics
Aesthetics
Manufacturability
Product / Process LinkageMass Customization
Common componentsCommon componentsStandardized parts
ModularModular platformsplatforms“Virtual inventory”
PostponementPostponementEnd of line customization
More RIP ... less FG ... faster cycles