paul o connor, the adept group yvonne goetzmann, sap xpd

1. Paul O�Connor, The Adept Group Yvonne Goetzmann, SAP xPD/xRPM Product Mgr Dave Maloney, SAP xPD/xRPM Product Marketing Quick intro to NPDI and SAP solution How IT can gain creditibility with NPD, satisfy their demands while delivering the solution on preferred platform from a trusted application vendor Conair exampleQuick intro to NPDI and SAP solution How IT can gain creditibility with NPD, satisfy their demands while delivering the solution on preferred platform from a trusted application vendor Conair example

3. Innovation and Portfolio Management

4. SAP definition of NPDI � NEW PRODUCT DEVELOPMENT & INTRODUCTION IS A BUSINESS PROCESS. NPDI starts with the identification of an opportunity in the market and ends with the successful launch of the product. In between are many activities to define the requirements, develop and test a product concept, fully define and develop the product, source for suppliers involved, plan the manufacturing and supply chain, and prepare marketing programs. On top of that, it�s about defining the product strategy, managing the overall product program, and monitoring all the projects and activities needed to drive the NPDI process. When ever we talk about �New Product� throughout this presentation this could equally refer to a New Service, New Package, New Process, New Business Model, New Channel, New program. Innovation is something new that ADDS VALUE, IS VALUED and OFFERS NEW BENEFITS. One final comment - Is NPDI the same as innovation? Innovation is clearly part of the NPDI process, without it there would be no new products or no new ways to make, market, and sell them. But innovation would be useless without the ability to change how the company operates, to successfully introduce the new product. The job of NPDI is not done until the product is in the market, shipped at the right time, delivered to the right customers, and in the right volumes. SAP definition of NPDI � NEW PRODUCT DEVELOPMENT & INTRODUCTION IS A BUSINESS PROCESS. NPDI starts with the identification of an opportunity in the market and ends with the successful launch of the product. In between are many activities to define the requirements, develop and test a product concept, fully define and develop the product, source for suppliers involved, plan the manufacturing and supply chain, and prepare marketing programs. On top of that, it�s about defining the product strategy, managing the overall product program, and monitoring all the projects and activities needed to drive the NPDI process. When ever we talk about �New Product� throughout this presentation this could equally refer to a New Service, New Package, New Process, New Business Model, New Channel, New program. Innovation is something new that ADDS VALUE, IS VALUED and OFFERS NEW BENEFITS. One final comment - Is NPDI the same as innovation? Innovation is clearly part of the NPDI process, without it there would be no new products or no new ways to make, market, and sell them. But innovation would be useless without the ability to change how the company operates, to successfully introduce the new product. The job of NPDI is not done until the product is in the market, shipped at the right time, delivered to the right customers, and in the right volumes.

5. New Product Development and Introduction Pyramid How will this apply to NPDI? Let�s look in more detail at the key processes involved in NPDI This time we have arranged them in a pyramid, with the strategic processes at the top, the management in the middle and the execution processes at the bottomHow will this apply to NPDI? Let�s look in more detail at the key processes involved in NPDI This time we have arranged them in a pyramid, with the strategic processes at the top, the management in the middle and the execution processes at the bottom

6. Innovation Management Goals: Align product development priorities with business strategy and determine customer and business needs Describe each process in turn, focusing on need for collaboration, speed and strong managementDescribe each process in turn, focusing on need for collaboration, speed and strong management

7. NPDI is the process of managing all activities and resources to bring a new product to market that meets customer needs and supports the business goals. Collaborative New Product Development and Introduction The perfect process for bringing new products to market allows companies to respond quickly and effectively to market opportunities It starts when a new opportunity is identified and is not completed until the product is successfully reaching customers It embraces almost all functions in the company and many of the companies external partners And it must be closely managed to ensure that both the needs of the customer and the business are met The process is so critical that, if badly executed, nothing will be able to make up for it And yet, despite this, we find wide-spread problems with the NPDI processThe perfect process for bringing new products to market allows companies to respond quickly and effectively to market opportunities It starts when a new opportunity is identified and is not completed until the product is successfully reaching customers It embraces almost all functions in the company and many of the companies external partners And it must be closely managed to ensure that both the needs of the customer and the business are met The process is so critical that, if badly executed, nothing will be able to make up for it And yet, despite this, we find wide-spread problems with the NPDI process

8. SAP Adaptive Business Network Framework

10. SAP xPD Product Roadmap and Availability SAP xPD 1.0 Idea and Concept management Integration with SAP xRPM and cProjects SAP xPD 2.0 (Ramp Up starts November 2005) Extended Idea and Concept management capabilities Requirements management Leverage existing investments ( integration capabilities) Analytics Details on xPD 2.0 Shipment: Shipment Date SP0 Ramp-up: November 21st 2005 General Availability: May 2006 (Planned) Platform: NW04s

11. SAP xRPM Product Roadmap and Availability SAP xRPM 1.0 Portfolio Planning: Project Registration, Resource Planning, Enterprise Approval Process Integration to human resources, financial and project management systems Analytics SAP xRPM 2.0 Simulation Advanced Capacity Management Integration to SAP xPD (Concepts) Enhanced integration to project management systems SAP xRPM 4.0 (Ramp Up starts October 2005) Flexible Portfolio Hierarchies Portfolio Lifecycling: Complete process from idea to commercialization Enhanced Scoring: Questionnaires, Scoring Models Portfolio Reviews

13. The 5 Key Challenges to NPD Proficiency Identifying or creating the �right� projects before executing the projects correctly Optimizing investments among multiple projects and opportunities, not just focusing on a single project Aligning, balancing and streamlining the decision flows and workflows across all New Product Development activities Leveraging the correct combination of organizational structure, organizational processes, point solutions and supporting information systems so as to meet NPD objectives Obtaining and Using Real-time Visibility into human resource, financial, and production capacity� true integration.

14. NPD Proficiency Requires Several Sub-processes Innovation Lifecycle To be proficient, organizations must integrate and streamline work, decisions, and information � from product line planning through product retirement. Optimizing one sub-process by itself is very helpful, but not sufficient. Consider, for example�

15. On this chart we see several things going on. This is an output from a statistical package called NewProd We see That for this fictitious organization A total of four projects will launch over the next 24 months, each currently is at a different point within the Stage-Gate process. Each carries with it a different probability of success ... R I S K This is what we call a �Projects-in Process portfolio� or PIPELINE PORTFOLIOOn this chart we see several things going on. This is an output from a statistical package called NewProd We see That for this fictitious organization A total of four projects will launch over the next 24 months, each currently is at a different point within the Stage-Gate process. Each carries with it a different probability of success ... R I S K This is what we call a �Projects-in Process portfolio� or PIPELINE PORTFOLIO

16. Accumulated Expected-Launch Value of the Stage Gate Portfolio

17. True NPD Proficiency Requires a full Framework of New Product Development� inclusive of a Proactive Front-end

18. �Big Picture� Progression of Full Framework Implementation

19. Primary Components of each Sub-process Workflow Decision Flow Information/Knowledge Flow

20. All Sub-processes and Supports Should Cut Across Functional Boundaries

21. Key Challenge to Implementation

22. How You Implement Process Is ImportantConsider data on Staged type process implementations

23. Seven Groupings of Portfolio Management Components

27. Benchmarking FindingsConsistency-in-use matters Sporadic (�sometimes�) use of components delivers little gain of benefits. Consistent (�always�) use of components correlates with notable benefit accrual. Consistency on one component increases the likelihood the organization will be consistent on other components. The greater the number of components executed consistently, the greater the benefits that an organization will realize.

28. Benchmarking FindingsThree key turning points in benefit accrual Consistent use of portfolio mix criteria / guidelines; inclusive of Front-end projects� implies strong relationship with �agreed upon strategy� Consistent use of resource and pipeline bottleneck forecasting� implies strong project management capabilities Consistent use of a centralized project and resource data repository� implies true integration of information

29. Key Drivers for Attaining �Consistency� Collaborative Process Design Common systems support Common real-time data

30. SAP Solution for Innovation Management �Discover ideas, define concepts, prioritize concepts and projects, manage resource capacity, and monitor performance of portfolio. SAP�s solution for product innovation management is designed to help companies translate ideas into innovative products and services. It is simple to use. Delivered through a standard browser, role-based interfaces and workflows ensure user-acceptance. Flexible. We are NOT delivering a solution with a pre-built innovation process. The SAP solution is fully configurable to conform to YOUR innovation process. Integrated. No other innovation management solution is as integrated. Key integration points to CRM for systematic idea capture to automatic project initiation via standard interface with operational project management systems like Microsoft, cProjects, Primavera.�Discover ideas, define concepts, prioritize concepts and projects, manage resource capacity, and monitor performance of portfolio. SAP�s solution for product innovation management is designed to help companies translate ideas into innovative products and services. It is simple to use. Delivered through a standard browser, role-based interfaces and workflows ensure user-acceptance. Flexible. We are NOT delivering a solution with a pre-built innovation process. The SAP solution is fully configurable to conform to YOUR innovation process. Integrated. No other innovation management solution is as integrated. Key integration points to CRM for systematic idea capture to automatic project initiation via standard interface with operational project management systems like Microsoft, cProjects, Primavera.

31. Good News: NPD Needs IT IT systems enable consistency in methods, but people across various functions must carry them out. To improve their NPD productivity�

32. Adept and SAP The Adept / SAP partnership spearheads the collaboration of NPD functions and IT.

34. VP of R&D: �Oh No � It�s the I.T. Guy!�

35. Conair Corporation Leading vendor of personal care, fitness, cooking, telephone and dental health appliances world-wide�. Conair, America�s #1 Brand in personal care, plus: Cuisinart, Scunci, Interplak, Waring, BaByliss

36. Growth Through Innovation

37. Conair�s Recognized Pain Points: Collaboration Challenges with New Product Collaboration across Functions and across the Global Enterprise Standardization / Consistency Lack of Centralized and Standardized Documentation Management and control NPD Efficiency and Effectiveness Increasing Costs and Revenue Loss due to inadequate Project and Change Management Systems and Procedures� Opportunities Lost / Diminished

38. Conair�s Full NPD Process

39. The Conair Solution Completeness: 3 parts of the NPD process are covered Standard workflow Ease of use: Easy to understand Easy to implement Easy to use Latest technology: Portal based access Web based applications Major Components: Concept Management Process & Project Management Document Management System Specs/Materials CAD/Artwork integration The Knowledge Management platform provides access to an organization's unstructured documents. Its major functional areas consist of: Content Management, which supports the entire lifecycle of documents, including the authoring, storage, management, and display of documents. Retrieval and Classification, for processing free-text search queries, providing automatic classification and general text analysis, and combining unstructured document content with content from a database (for example, for an expert search.) Collaboration, for closing the communication gap between users or teams by providing real time (chat, online conferencing, etc.) and asynchronous (feedback, rating, discussion forums, shared folders, etc.) collaboration support.The Knowledge Management platform provides access to an organization's unstructured documents. Its major functional areas consist of: Content Management, which supports the entire lifecycle of documents, including the authoring, storage, management, and display of documents. Retrieval and Classification, for processing free-text search queries, providing automatic classification and general text analysis, and combining unstructured document content with content from a database (for example, for an expert search.) Collaboration, for closing the communication gap between users or teams by providing real time (chat, online conferencing, etc.) and asynchronous (feedback, rating, discussion forums, shared folders, etc.) collaboration support.

40. Conair Global NPDI System Overview

41. Conair Implementation Roadmap Milestones (1 of 2) Need for a PLM/NPDI system identified in 2003 Conair secured the �mySAP� software suite including SAP NPDI (SAP xRPM, SAP xPD) in December 2003 May 2004 started with development of �process blue-print� as Conair had no �consistent� global process. Focus on process, workflow and information flow. Blue-Print signed off by Global Sponsors in October Meanwhile developed a prototype NPDI system �

42. Process and systems testing involving NPD and Engineering � identified gaps in first prototype � Innovation team found prototype lacking in terms of speed of use plus too front-end (idea management) focused� � IT responded: Changed SAP tools to focus on project portfolio management rather than ideas Second prototype built by April. Just completed �hands-on� training and testing in Stamford and Hong Kong. Now have a working pilot system. Planning further development ready for a Fall implementation when Personal Care Division�s product development cycle reaches the slower time of the year Conair Implementation Roadmap Milestones (2 of 2) Another example of IT flexibility is changing project timeline to fit Innovation team�s calendarAnother example of IT flexibility is changing project timeline to fit Innovation team�s calendar

43. Complete Vision We have a high-level complete vision of full NPD processes, workflows and decision flows We are leveraging SAP tool set which provides us with Front-end to Back-end thoroughness, extraordinary flexibility / configurable, and integration with potential point solutions Well-understood Business Case We have a strong case based on the magnitude of our NPD work and number of different product categories and locations we need to coordinate Business Release Approach We agreed a first, pilot implementation for hair dryer product category Improving Maturity one level at a time (SprialUp): No 3 year plan leading to �big bang� implementation Cross-Departmental Initiative We have a wide range of functions, departments and locations involved Steering Group is multi-functional and spread across the globe Configuration are based �in the trenches� Critical Success Factors (1 OF 2) Our mitigation strategies for some commonly known systems implementation challenges �Our mitigation strategies for some commonly known systems implementation challenges �

44. Critical Success Factors (2 OF 2) Avoid Placing Too Much Burden on Application Software Recognize need to change processes and standardize: Build �Consistency� In second prototype recognize need to customize parts of the software Using newest SAP tools (on SAP NetWeaver) which are highly configurable #1 Recognize need and execute so as to fit software to NPD work and decisions, not the other way around No Owner of the Product Lifecycle Currently, functional silos are optimized at expense of cross-functional NPD efficiency Power of new NPD process and systems lies in cross-functional / cross-geography collaboration. Collaboration and shared ownership starts here ! Our mitigation strategies for some commonly known systems implementation challenges � Our mitigation strategies for some commonly known systems implementation challenges �

45. The CIO�s Key Learning�s (1 of 2) CIO�s learnings key � sounds easy but, obviously, in a complex/global marketplace, is easier said than doneCIO�s learnings key � sounds easy but, obviously, in a complex/global marketplace, is easier said than done

46. The CIO�s Key Learning�s (2 of 2)

47. Conclusions

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