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Managing Innovation for New Product Development: The Fuzzy Front End

  • ID: 42734
  • Report
  • January 1998
  • 62 pages
  • American Productivity & Quality Center, APQC
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Companies cannot grow revenues in today’s competitive global business environment without the ability to introduce a stream of successful new products. A major challenge facing firms that seek to innovate is implementing an effective, repeatable process for the fuzzy front end of new product development. Deschamps and Nayak1 define the phrase “fuzzy front end” with a process they call “idea management.” Idea management drives the product creation process using creativity in context with collected intelligence (on markets, competitors, technologies, etc.). The core activities of idea management are idea generation, collection, evaluation screening, and ranking. Surviving ideas emerge from the idea management process as high-potential concepts, which then enter the organization’s product development process.

In the context of a supportive organizational climate, a high-performance fuzzy frontend process results in a flow of high-potential product concepts. But a major barrier to sustainable innovation, identified both in this study and in current literature, is the existence of a change-resistant corporate culture. Buckler2 documents how maturing corporations lose the ability to “generate new value through innovation” and characterizes innovation as “the natural state in the exciting, chaotic start-up period of a company’s history. For those that survive, it seems just as natural that the spirit of innovation dies out as the company matures.”

To counteract this trend, senior management must lead the process of institutionalizing an innovative mind-set. The goal is to nurture and reward what Amabile3 calls entrepreneurial creativity, “the implementation of novel and useful ideas to establish a new business or new program to deliver products or services.” This study identified and documented best practices in two domains: a fuzzy front-end process for increasing the flow of high-potential product concepts and an innovation model for creating and maintaining an innovative corporate environment for sustained new product development success. Figure 1 shows the work flow of typical activities and inputs to a fuzzy front-end process. These inputs, activities, and outputs are discussed in detail, with examples of specific practices, in Section Two of the report. The existence of a clearly defined fuzzy front-end process, along with facilitation of its use and availability of sufficient resources, are critical success factors in sustainable innovation.

Creating a corporate environment that is conducive to innovation depends on
senior management implementing the specific practices described in each of the four “building blocks” of the Innovation Model. Section One of this report presents specific details of the four building blocks:

1. Innovation Strategy Development—innovation vision and goals, linked to corporate strategy, describe the role that new products will play in achieving corporate objectives.

2. Management Practices—strategies, activities, values,
and processes that motivate and support innovative behavior.

3. Facilitators of an Innovative Culture—enablers and processes that remove barriers and facilitate an environment conducive to innovation.

4. Resources—knowledge management systems and dedicated support for individuals and teams to function creatively.

STUDY BACKGROUND AND SCOPE

Interest in exploring this concept as a study topic was generated during the Marketing Research for New Product Development consortium benchmarking study,
conducted by the American Productivity & Quality Center’s (APQC) International Benchmarking Clearinghouse in early 1996. As a result, the Managing
Innovation for New Product Development: The Fuzzy Front End consortium benchmarking study was initiated in December 1996. Representatives from the 23 sponsoring organizations defined its scope to encompass the following areas.
Organizing for Innovation Management
- Joint involvement of Marketing and R&D for product innovation
- Creation of dedicated innovation groups
- Compensation and rewards linked to innovation
- Management practices to support the innovation process

Idea Generation
- Identifying areas of opportunity or customer need
- Developing idea banks to capture those needs
- Seeding, screening, and monitoring of ideas
- Managing ideation activities as an ongoing process Concept Development and Screening
- Incorporating user feedback to enrich product concepts
- Employing strategic concept screening

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- Sponsor and Partner Companies

A complete listing of the sponsor companies in this study, as well as the best-practice (“partner”) companies that were benchmarked for their ingenuity and
advancement in managing the innovation piece of new product development.

- Executive Summary

A bird’s-eye view of the study, presenting the methodology used and the discoveries of the study. These discoveries are explored in detail in following sections.

- Building Blocks to Innovation

An in-depth look at the four components necessary for innovation to occur and how they are used in the bestpractice companies.

- The Fuzzy Front-End Process

An examination of the activities that compose the fuzzy front-end process.

- Partner Company Profiles

Background information on the partner companies, as well as their innovative new product development practices.
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