Product Generation a.k.a. Product Management

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Product Generationa.k.a. Product Management

• Ken Homa

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Product Generation

• New Product Development
• Product / Process Linkage
• Product Line Management
• Branding Strategy

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Product Life Cycle

• Typical pattern, highly varied
• by product, geography
• Cash flow critical
• Mature lend, growth borrow
• Manage the PLC
• Differentiated tactics
• Revitalization

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Product Line MangementThe Issue

• Owning a customers lifetime profitability
  requires a full line that keeps competitors out.
  The incremental costs of line extensions are low
  computers handle the complexity.

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Product Line MangementThe Issue

• Owning a customers lifetime profitability
  requires a full line that keeps competitors out.
  The incremental costs of line extensions are low
  computers handle the complexity.
• Pareto lives. Stay focused and simplify.
  Pick your winning products and customers, bet big
  on them, and be willing to walk away from some
  business.

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Product Line ManagementThe Issue

• A broad product line is required to fully
  cover all (or most) customer / market
  requirements
• ...and to erect barriers from competition.

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Product Line ManagementThe Issue

• A broad product line is required to fully
  cover all (or most) customer / market
  requirements
• ...and to erect barriers from competition.
• But, complexity costs increase
• exponentially as product lines get long

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Product Line Proliferation

• Size, color, pack
• Special derivative models
• Accessories
• Ancillary products
• Multiple generations

Combinations permutations ...
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Power Tools
The evolution of a product line ...
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Power Tools
PROFESSIONAL
CONSUMER
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Power Tools
DRILLS SAWS OTHER
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Power Tools
CORDLESS (DC)
CORDLESS (DC)
CORDED (AC)
CORDED (AC)
DRILLS SAWS OTHER
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Power Tools

• FEATURES
• SIZES
• COLORS
• PACKS

• Variable speed
• 1/4, 3/8. 1/2 drills
• Pro black DeWalt yellow
• Redistribution, Kits

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Power Tools

• Strategic Models
• Supplementary Brands
• Complementary Products
• Accessories
• Global / Regional Models

• Flagships, fighters, derivatives
• Sub-brands, private label
• Cordless tools, chargers
• Drill bits, saw blades
• 110/240 V

Generational Recycling ...
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Product Line ManagementBreadth Depth of Line

• Key product line / item profitability
• Imprecise, but enlightening

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Product Line ManagementBreadth Depth of Line

• Key product line / item profitability
• Each and every item has associated costs some
  visible, some hidden
• Cannibalization
• Inventory
• Administration
• Repair parts

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Product Line ManagementBreadth Depth of Line

• Key product line / item profitability
• Each and every item has associated costs some
  visible, some hidden
• Pareto is alive, well ... and applicable
• Rule of 80 / 20

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Product line managementKeys to Success

• Strive for shortest line Treat incremental items
  as major decisions

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Product line managementKeys to Success

• Strive for shortest line
• Watch for line creep
• Especially when new generations launched

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Product line managementKeys to Success

• Strive for shortest line
• Watch for line creep
• Prune aggressively
• Tie pay to line profitability

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Product line managementKeys to Success

• Strive for shortest line
• Watch for line creep
• Prune aggressively
• Link product process design
• Mass customization

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Design Elements

• Technical Efficacy
• Innovation
• Functionality
• Ergonomics
• Aesthetics
• Manufacturability

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Design Elements

• Technical Efficacy
• Innovation
• Functionality
• Ergonomics
• Aesthetics
• Manufacturability

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Product / Process LinkageMass Customization

• Common components
• Standardized parts
• Modular platforms
• Virtual inventory
• Postponement
• End of line customization

More RIP ... less FG ... faster cycles