Project Management in
New Product Development


ABOUT THE AUTHOR

Bruce T. Barkley is the author of Integrated Project
Management, and Project Risk Management, and is
co-author with James Saylor of Customer-Driven Project
Management: Building Quality into Project Processes
(all from McGraw-Hill). Customer-Driven Project
Management has been translated into Chinese, and is on
the Project Management Institute Best Seller List.
Mr. Barkley is a senior faculty member and project management curriculum manager with DeVry University, Keller
Graduate School of Management in Atlanta. He teaches
management courses and chairs the Keller Project
Management Faculty Forum in the Atlanta metropolitan
region. DeVry/Keller is one of the largest producers of quality
graduate project management (MBA and MPM) degrees in
the world in a unique online and onsite learning format.
Mr. Barkley has managed the Project Management Office
(PMO) with Universal Avionics, Inc., Atlanta Office, and
served as Vice President of The Learning Group Corporation of
Rockville, MD, a project management consulting company.
Mr. Barkley was a member of the Senior Executive Service in
the federal government in Washington, DC, and served four
cabinet secretaries—Transportation, Environment (EPA),
Office of Management and Budget, and Heath and
Welfare—in a variety of career management positions.
He has a bachelor’s degree from Wittenberg University

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DOI: 10.1036/0071496726


To the thousands of hard working, adult graduate
and undergraduate students at DeVry University/
Keller Graduate School of Management, Atlanta,
and at The University College, University of
Maryland, who have provided me over the past
35 years with wonderful opportunities to learn

Providing information and feedback
Creating a virtual place for new ideas
Generating a filtering process
Demonstrating successful ideas
Organizational Agility
Creative intelligence and new products
Risk and New Product Development
Risk: The organizational culture issue
A culture of risk management competence
Link corporate and new product planning
Training and development in risk
Project experience
Learning organization
Functional managers
Building the Culture
Keane’s risk process
Risk analysis and mitigation
Addressing risk with scenarios
Performance incentives
The Johari Window
Personal, Project, and Organizational Risks
The New Product Risk Framework
Another Case in (No) New Product Development: The Schneider Program
Another Story of New Product Development

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Contents

Chapter 2. Strategic Alignment and the New Product Portfolio
New Product Portfolio
New project process
The Eastern Case
Commitment and partnership
Stakeholder relations
Eight strategies
Overview on integration issues
Strengths, weaknesses, opportunities, and threats
Eastern’s Strategic Plan
Underlying Elements of the Risk-Based Strategic Plan
Mission
Commitment and partnership
Driving force: Production capability
Core competencies and risk contingencies
Eight Key Strategies
Strategy 1—Secure economically priced power
Strategy 2—Secure other resources at reasonable costs
Strategy 3—Cultivate customer awareness and promote
customer satisfaction
Strategy 4—Create a safe working environment
Strategy 5—Build a responsible and knowledgeable workforce
Strategy 6—Improve technology and plant equipment to produce

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PMI OPM (Organizational Project Management) 3
Balanced Scorecard
eProcurement
Integration: Concepts and Models
Understanding integration
Integration model
Project Integration Management: Organizational Issues
Prepare the Organization
Develop systems of integration
Develop integration skills
Recognize integration success
Integrate with the customer
More Detail on the PMI PMBOK Standard for Project Integration
Develop Project Charter
Develop project charter: Inputs
Organizational Process Assets
Develop project charter: Tools and techniques
Develop project charter: Outputs
Develop Preliminary Project Scope Statement
Develop preliminary project scope statement: Tools and techniques
Develop project management plan
Develop project management plan: Inputs
Develop project management plan: Tools and techniques
Develop project management plan: Outputs
Direct and Manage Project Execution
Direct and manage project execution: Inputs
Direct and manage project execution: Tools and techniques
Direct and manage project execution: Outputs
Monitor and Control Project Work
Monitor and control project work: Inputs

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The portfolio: Procedures in development
Definition: Work breakdown structure
Plan tasks for earned value
Integrated monitoring
“Reading” the project as an integrated whole
Integration of cost, schedule, risk, and quality
Steps in the cost/schedule/risk/quality integration process
Integration Skills of the Program and Project Manager
Single project management
Program (or multiproject) management
BuildIt: A Sample Integrated Program Structure
Organization
Strategic statement
One- to five-year strategic objectives
Program of projects
Project cost accounting systems (PCAS)
A program management manual for integrated project management
Program management principles
Meet customer requirements
Follow integrated, generic WBS—Product development process
Standard work breakdown structure
Teamwork
Define and communicate the scope of work and assignments clearly
Collaboration across the organization
Work will be quality and schedule driven
Ensure timely procurement of product components
Change will be managed
Program progress will be tracked periodically reviewed
Program management: Roles and responsibilities
Program management office (PMO)

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Decision Trees and Uncertainty
Decision tree example
Decision tree theory
Expected value
Pat’s decision example using decision trees
Target cost analysis

Chapter 4. Product Concept Definition
The Product Concept Phase
Entering the Concept Definition Process
Controlling premature product lock-in
Concept Definition Phase
Schedule Template
Setup for Project Review: Go or No-Go Decision
Project review: Go or no-go time
Going from Idea to Concept to Product
New Product Concept Proposal
Need, Form, and Technology
Project Value Assessment
Estimating Product Value in New Systems or Process Concepts
Concept Risk Assessment
External analysis: Public policy analysis
Intellectual property analysis
Market demand and other impacts
Product Functional Specifications
Commercialization Analysis
Competitive Analysis
Finding drivers of competition
Working Out Customer/Client/User Expectations, Needs, Wants,
and Requirements

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Final test plan
Special project management issue: Test space and equipment
Prototype development and testing process
Conduct Prototype Test
Select commercial partner
Selection of supplier partner
Steps in partner selection
Prepare Product Component Support Document
Risk Assessment
Intellectual Property Strategy
Develop Preliminary Market Launch Plan
Field Support to Market Launch
Create Production Process and Plan
Create preliminary production plan
Quality control review
Produce test units
Develop field test protocol
Develop field test implementation plan
Update service and logistics plan
Update Business Plan
Update market definition
Locking in product design
Final Regulatory Approval
Final production transition and scheduling
Reconfirm Final Business Case
Supply chain strategy
Update market assessment
First Article Review
Prepare manufacturing operations plan


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Contents

Produce first article
Final financial performance analysis
Final Logistics Plan for Market Launch

verification and validation
Stages in Product Development in Electronic Instrumentation
Steps in Product Development
Step 1: Requirements definition
Step 2: Detailed design
Step 3: Prototype development
Step 4: Design validation
Step 5: Production transition
Risks in Organizational and Technical Interfaces
Design changes
Design review and risk
Risk reviews
Preliminary design risk review (PDRR)
Critical design risk review (CDRR)
Production readiness risk review (PRRR)
System design risk review (SDRR)
Test readiness risk review (TRRR)
Task-level requirements risk review (TLRRR)
Task-level design risk review (TLDRR)

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Contents

General Responsibilities
System-level reviews
Task-level reviews
Function of task-level reviews
Preliminary design risk review (PDRR)
Critical design risk review (CDRR)
System design risk review (SDRR)
Test readiness risk review (TRRR)
Task-level requirements review (TLRR)
New Product Software Development Risk

Chapter 7. Quality, Six Sigma, and New Product Development
Quality and Process Improvement

Concept development
Generation of alternative candidate projects
Scope of work
Schedule
Budgeting and earned value
Quality assurance
Project metrics
Prototyping

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Contents

Quality audit
Transform customer expectations to requirements
Follow a defined development process and work
breakdown structure
Schedule customer and quality early
Customer-driven teamwork
Define and communicate the scope of work
and assignments clearly
Collaboration across the organization
Work will be quality and schedule driven
Ensure timely procurement of product components
Change is managed
Program progress will be tracked and periodically reviewed
Involve the customer in designing the management
support system
Quality as Driver
Reviewing Program Progress and Resolving Conflicts
Project planning
Departmental manager roles
Project team roles
Role of a project management office (PMO)
Scheduling
Baselining the schedule: A quality management action
Schedules on a network
Resource Planning
Long-Term Staff Planning
Preparing Staffing Policy and Plans

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Computer-aided acquisition and logistics support
In-plant quality evaluation program
R&M 2000
Value engineering
Measuring the Success of New Product
Development Mainstreaming
Measuring New Product Workmanship

Chapter 9. Project Management and Teamwork
Team Dynamics
Customer and User Diversity
Personal Growth in New Product Development
Growth to New Products Program Manager Role
Single Project Management
Program (or Multiproject) Management
Gender and Minority Diversity in New Product Development
Individual Responsibility as a New Product Team Member
Do it right
Be a leader
Serve the team
Develop yourself
Doing Your Own Performance Appraisal
Step 1. Envision personal improvement
Step 2. Enable personal improvement
Step 3. Focus on improvement
Step 4. Improve the job
Step 5. Improve yourself
Step 6. Help others improve
Step 7. Evaluate your improvement progress
Empowerment

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Appendix A. Generic New Product Development
Work Breakdown Structure

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Appendix B. Managing New Product Development
Projects: Course Outline

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Appendix C. Issues for Discussion

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Bibliography
Index
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Acknowledgments

The author would like to acknowledge the following sources for this book:
■


in this field for years.

■

The Project Management Institute, Project Management Body of Knowledge
(PMBOK), 2004.

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Copyright © 2008 by The McGraw-Hill Companies, Inc. Click here for terms of use.


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Introduction

This book is about managing new product development using project management concepts and tools. The author has been guided by seven key principles in
addressing how to manage new product development projects. These principles
are addressed here briefly and then wrapped up again in Chapter 10. These
principles are as follows:
Principle #1. Develop project management and new product development
processes, and integrate the two. The theme of the book is that new product
development is a largely technical and developmental process that must be
carefully managed to control time, resources, and quality. The fundamental
contribution of project management tools and techniques is to enable project
managers to make the business case for a new product. Both the project management process and the new product development process must be defined in
order for this integration to work.
Principle #2. Open the company to new ideas and new partners. The organization has to be open to new concepts and ideas, and sometimes has to take
a proactive approach to find new ideas and partners on a global scale. New

and concepts, but once you decide to go with a new product and fund and develop
it, manage and control the process using disciplined process definitions and proven
project management tools.

The reader will be introduced in this book reflecting a series of processes and
phases, some of them technical and others simply common sense, for managing
new product development. Some of these processes, may not provide the kind
of detail an engineer might be looking for. The author preferred to stay on the
high ground in these discussions and let the reader fill in the gaps with technical details tailored to specific organizations. For instance, we do not go into
detail on various configuration management packages available to preserve the
structure and components of new products in development, depending on the
reader to pursue that level of inquiry.
In some cases we provide perhaps more detail and structure than the typical
reader will want. For instance, we provide many illustrations of a key project
planning tool, the Gantt chart, with detailed tasks, linkages, and assigned
resources. Some readers may be bored by this focus on administrative tools, but
our purpose here is to offset the common bias against this kind of tool among
new product and marketing professionals.
The author is a student of organizational behavior and leadership, as many
of our readers will be. We mention this because we try to place new product
development and project management in the context of a company culture.
Culture sets the boundaries for management and employee behavior, sometimes
unconsciously, and thus deserves some attention. What Pepsi Cola does with a
given project in its new product development process may not align with what
Coca Cola would do with the same project. Thus “one size fits all” does not work
very well when applying standard models of work to new product development.
The reader is advised to grasp the conceptual material here and to then work
to integrate the concepts into the target organization, whether it be a given
company or a case study for training or education purposes.
The reader will also see a bias in the book toward application of management and administrative tools that might be inconsistent with the thinking

This book is different in many ways from past treatments of new product
development and project management. This is a managerial view of the new
product development process, the perspective of company management in the
new product business. The view is driven by the need to grow the business,
control resources and time to market, monitoring how the process is going
against business strategy, and when to proceed and when to “pull the plug” on
a bad product. The book takes an integrative perspective on the process, not
bound by narrow views of consumer products or services or traditional marketing concepts that sell whatever product is produced. Emphasis is given to what
can and does go wrong with many new product development and marketing
initiatives because things weren’t planned very well.
While the book provides a reasonably detailed discussion of new product
development from a technical view, its purpose is to put that process in a
management framework, to embody technical process in managerial context.
New products are not projects until they evaluated, planned, scoped-out,
scheduled, budgeted, managed, and monitored by managers. It is not technical process failure that inhibits the successful introduction of new products
into the economy—it is typically managerial and marketing failure.
A short journey through the history of these two fields—product development
and project management—may be helpful here.
What is new product development? There is a presumption in many quarters
that new product development refers essentially to consumer products—not
system or process products. That is, the concept of product is confined in this
marketing sense to products for consumption, and marketing is the process


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Introduction

of ensuring that customers are attracted to and buy the product. However,
the other view is that new products can be system or process products as

development as not worth their time.
I see these historic and narrow conceptual boundaries in these two fields
as inhibitors of imagination and understanding, as evidences of Thomas
Kuhn’s (The Structure of Scientific Revolution) paradigms that restrict a full
view of what is really happening out there and what should happen out there.
Paradigmatic change occurs only when someone can overcome the blinders of
constrained thought processes to question conventional wisdom and to get at
reality for those in a real work setting and who muddle through the messy world
of the competitive global marketplace.