As everything else in your business, there will be two types of activities that you and your team members will take in product development process. The first activities are value added activities that bring additional value to your company and your customers. The second type of activities are wasting activities that simply don’t add value.
In this post, I would like to open the subject related to value added activities in product development process. The lean production originated from the Toyota Production System becomes more and more popular not only for the manufacturing companies, but also for software development and service companies. The primary purpose of lean product development is to cut all wastes in the process and focus on everything that will add value to the company and customers.
Let’s start with definition of value.
What Is Value?
The value isn’t the result of your product development process or what you have developed or produced. The value isn’t what you are offering to your customers. The real important value for you as an entrepreneur is what your customers or potential customers value or will value in the future. You need to define value entirely from the customer’s perspective, and not from your or your team members.
James Womack defines value as the “right product to the right customers at the right price and at the right time.” This is totally different definition from the traditional view of the value. The product can be physical product, software, mobile/web product, online training or anything else that company delivers into the hands of the customers. So, product development is the process of value development for your customers.
Knowledge Development as Value Added Activity in Product Development
The first important activity that is part of the group of value-added activities in your product development process is using and expanding specific knowledge that this process will need.
Effective product development process will require strong knowledge base inside the company. You will need knowledge for customers, knowledge from the capabilities of the value production processes, knowledge that will help you to integrate the customer knowledge and technical knowledge.
The knowledge about customers is one of the most important knowledge that you and your product development team will need to have at starting stages of the process. The related most important knowledge will be:
- Knowledge about customer’s needs. What customers want? What customers want? What are customer’s biggest frustrations? What are customer’s biggest problems?
- Knowledge about customer’s behavior. What customers are doing? How they now solve specific problem? How they now satisfy specific need or want?
- Knowledge about customer’s environment. How they interact with other people? How other people impact their decisions? How other people are related to their needs and behavior?
It is important to understand as much as possible your current and potential customers if you want effective product development process regardless about what type of product will be the subject of the process. You need to put enough efforts to build these types of knowledge and because it is value added activity it is important part of the process. So simply, start collecting information, meet with customers and research their behavior. You can visit places where they are buying or use your products in order to explore how they interact with your products.
The next important knowledge gaining activities is activities related to technical knowledge about your product and production technology. When you gain enough knowledge about your customers, you will need to compare if these knowledge is compatible with your current product and production technology.
What design alternatives there will be? What are manufacturing capabilities? What are suppliers capabilities? Is science giving you possibilities to design what your customers want? These and many more questions related to technology will need to be answered when you want to develop knowledge important for your product development process.
The next important knowledge is knowledge about integration of two previously gained knowledge. These activities will enable you integration of customer’s needs with your production capabilities. How you can translate customers needs into product features that will need to be developed through product development process.
Process of Product Development as Value Added Activity
You have a knowledge gained activities and you have processes used for product development activities. You have gained knowledge about your customers, and you know what they want. You have gained knowledge about how you can make what your customers want and as a last you have gained knowledge how you can translate what they want to the real value in their hands.
Different product development processes have different subprocesses integrated within. But, the most used subprocesses can be classified as:
- Idea generation process. This process in large part will be based on gaining knowledge about your customers and gaining knowledge about your technology to find problems and causes. Because the output of this process will give you specific next steps that you will need to take as a part of product development, it is one of the most important value added activities. Try using systematic problem solving approaches.
- Design process. The next important sub-process is design process in which you and your team will start creating the design of the product and services. Here will be created features related to customer’s needs, specifications, look and feel of the product and specific action steps that will need to be taken in order to produce such a product or services.
- Communication. Another important subprocess that adds value to your product development process is communication between team members. There will be a need of meetings, talking, and exchange of information. This subprocess is important because it can easily become waste instead of value if your team members start to practice long hours meetings without clear decisions about future steps. So, don’t hold meeting if it is not designed for decision making or action taking.
- Testing and Experimenting. And as a last important subprocess that I will mention here is testing and experimenting. What you have developed on the paper or electronic form is not same as when you start creating the product in the reality. Testing and experimenting will bring you many problems that aren’t discovered in the previous processes. On the other side, it is last chance to improve some specifications. You need to test and experiment with the products, production processes, suppliers, and customers.