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LEAD Innovation Blog

Read our latest articles on innovation management and innovation in a wide range of industries.

Date: 30-Apr-2018
Posted by: Michael PUTZ
Category: Innovation process

Has the innovation process in accordance with the Stage Gate model become obsolete?

 

The development of innovations in the form of new products or services is one of the most demanding management tasks. Therefore, the innovation process requires professional process models and methods that are up to the challenges.

Challenges in the innovation process

The management of innovations makes high demands. The challenges are based on the peculiarities of innovation:

  • Uncertainty: The output is something new, at the beginning of the process one does not know the basic conditions in detail, nor the concrete way and the goal. Dynamics add up to this, since the assumed environment in which one acts can change.
  • Interdisciplinarity: The development and implementation of a new service requires the involvement of almost all corporate divisions. It requires their cooperation and resources and often leads to a change on their side.
  • Scope: Innovation always brings change. Innovations are often far-reaching changes that can affect the company's business model and its DNA. What is more, the problem is that people and organisations often react to changes with great resistance.
  • Knowledge intensity: Developments and decisions in the innovation process require extensive knowledge and information. In some cases, it requires knowledge that is not yet available in the company.
  • Individuality: In comparison to a production process, where each output is the same and can therefore be planned, each output is individual in the innovation process.

All of these characteristics and factors make innovation a challenging and complex project that requires suitable processes and methods.

Paper Innovation process

An innovation process is absolutely essential to eliminate errors and unnecessary loops due to missing or incorrect information, for example, and to ensure efficiency and productivity. But it requires a process model that is capable of meeting these requirements of innovation.

 

Definition of the Stage-Gate® process

Robert Cooper's famous Stage-Gate® process has established itself in innovation management. It divides an innovation project into individual stages, which are very similar in terms of content and requirements. In between there are so-called gates, also as milestones, where decisions about the further procedure are made. Based on defined criteria and deliverables, decisions are made at these gates as to whether the project will be continued or not. If the decision is positive, the framework conditions, objectives and thus deliverables are determined for the next stage.



Strengths and weaknesses of linear process models for innovation

One of Stage-Gate®'s strengths lies in the high level of attention paid to the decision gates, where the focus is placed on quality and goals. In addition, this process concept does not allow you to skip any necessary process steps.

Stage-Gate® is criticized for being too linear. Linear process models, where a run-through or project is planned and implemented from beginning to end, have limits for innovation.

  • At the beginning of an innovation project, uncertainty means that the goal and path are only roughly known.
  • The consequences of an action in the process are not fully predictable. This means that the next work step can only be defined if you know the results of the previous step.
  • This means that planning from start to finish is neither possible nor sensible.
  • In addition, strict process planning excludes the possibility of accidentally discovering new innovations and solutions. And the necessary flexibility is limited.


From these points of view, a linear approach to the development of an innovation can even be counterproductive, especially in the creative phase.

 

Concept of an optimal innovation process model

Rough planning with Stage-Gate

Every innovation project requires rough planning. Even if one deals with the future and this has its limits, a rough planning is still necessary, on which one can orientate oneself. This rough-cut planning can be based on the typical phases

  • Concept development and business plan,
  • Feasibility and prototype development,
  • implementation, and
  • commercialization.
These phases can be controlled with the Stage-Gate® concept. If necessary and meaningful, the stages can be divided into sub-stages. The gates in between are thus the milestones.


Different requirements in the stages

The creative, less predictable phases in the innovation process such as concept development and prototype development, where solutions are developed and tested, require an agile and iterative approach. This is precisely where the challenge lies in the innovation process.

The plannable phases such as implementation in production and marketing can be controlled linearly. They are less marked by uncertainty. The results and the way to get there are mostly known and can therefore be planned.



Iterative and agile procedure models for innovation

Process methods for creating innovation must not restrict. They must allow flexibility, encourage creativity and facilitate quick decisions.

Scrum, Design Thinking and Lean-Startup are currently on everyone's lips and have also proven themselves. They are agile process models that are very useful for innovation projects. Scrum is a project management method. Design Thinking and Lean-Startup are tools for the development of innovations, which will be discussed in more detail here.

Design Thinking and Lean Startup work according to the trial-and-error principle. Another success factor is the intensive involvement of users and customers. On the one hand, as much information as possible about the user and his requirements is collected and analyzed as a basis, and on the other hand they are intensively integrated into the development process by testing and analysing prototypes.

The process principle is iterative, i. e. it runs in loops with the following contents:

  • Research and analysis of user needs and framework conditions
  • Derivation of ideas and concepts (also hypotheses)
  • Development of prototypes for collection (quick and dirty - only with the necessary functions)
  • Testing the prototype to collect user feedback and validate hypotheses

These activities are repeated until a finished, checked prototype is available. At each step the prototype becomes more and more detailed, at the beginning it can only consist of paper and plasticine.

Design Thinking and Lean Startup are very similar in principle to each other, they differ mainly in the structure of the phases.



Conclusion - innovation process according to the Stage Gate model

Has the Stage-Gate® process become obsolete? The answer to the question is no, but... Stage-Gate® is optimal for rough planning, where it should also be used. However, due to its linearity the model has its limits.

Within the stages it requires a process model according to the requirements. The phases of implementation and marketing are rather linear. The challenge lies above all in the creative phases such as the development of the solution. They require an iterative and agile approach such as Design Thinking or Lean Startup. The further development of Stage-Gate® by its inventor into a hybrid model from Stage-Gate and agile methods goes exactly in this direction.

5 tips for a future fit innovation process

Michael PUTZ

Born in the Salzkammergut. After working for Shell and Porsche, he concentrated on innovation management as a study assistant at the Innovation Department of the Vienna University of Economics and Business Administration. In 2003 he founded LEAD Innovation and manages the company as Managing Partner. Lectures at MIT, in front of companies like Google or NASA.

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