One of our clients attended the recently-held Front End of Innovation conference, sponsored by PDMA (Product Development & Management Association) and IIR (Institute for International Research). He emailed Skip (Skip Creveling, President of PDSS Inc.) with the following comments:

I went to the Front End of Innovation conference in Boston a couple of weeks ago.  It was quite good to hear how companies are driving innovation in their businesses. Some Six Sigma-speak (mostly negative), but not much.  I was thinking about my businesses in relation to the drive for innovation, which is limited at the moment, and how DFSS (Design for Six Sigma) fits in.  Often, projects are set in motion by an internally derived strategy which makes it difficult to propose innovative ideas or even do VOC (Voice of the Customer) work, other than to verify the existing strategy or project proposal. Anything proposed outside the strategy can easily be dismissed.

A follow-on book to Clayton M. Christensen's The Innovator's Dilemma that I just got called, Innovator's Guide to Growth (Scott D. Anthony, et al., Harvard Business School Press, 2008) has some interesting concepts regarding VOC and ways to think about what our customers are trying to accomplish.  It seems much more about determining targets for innovation and aligning a strategy accordingly.  I try to hit some of these concepts teaching VOC, but in practical terms, it is usually within the scope of a project, as opposed to a more open ended VOC to determine the right strategy in the first place.  I am teaching the tools, but perhaps to the wrong audience or with the wrong objective in mind.

Some of the innovation consultants have linked their methods as the input to Stage Gate processes - fill the hopper with good projects, which makes sense, but the businesses I have been in were not structured this way.  And had no dedicated innovation group as many of the companies at the conference described.

Not sure where my thoughts are going with this, but it seems we need a stronger link between VOC and the business strategy that defines the projects we work on.

In response, Skip referred him to Chapter 4 of his book Six Sigma for Technical Processes (Clyde M. Creveling, Prentice-Hall, 2007), entitled "Strategic Product and Technology Portfolio Renewal Process". Skip calls this "DFSS for Portfolio Renewal Teams". A summary of portions of this chapter follows.

Six Sigma in the Strategic Product and Technology Portfolio Renewal Process

We call Six Sigma in the strategic product and technology portfolio renewal process "inbound work". This work comprises gathering data to help define, develop and renew the product portfolio and its supporting technology portfolio. An integrated team of technologists, product managers, market research specialists, attorneys, sales managers, product and supply chain specialists participate in this strategic process of gathering and processing data. This work takes money, time and really top-notch people. Under investing here is the beginning of an ingrained inability to sustain growth.

Technology portfolios have no meaning outside the product portfolio they enable. Product portfolio requirements primarily drive technology portfolio requirements. Can a new, innovative technology drive product portfolio requirements? Yes. How often is this the case? Not as often as you might think, but it does happen. Therefore, we must have an open mind and balance our behavior accordingly.

Inbound is how we characterize the flow of data that will be acted upon to define the families of new products and services a company will convert into financial growth by way of satisfied customers. Companies don't exist to satisfy technologists who develop new technologies. If you are a technologist or engineer and you don't get a kick out of seeing your customers delight in what you develop, you need to reconsider why and where you are working. In industry, you have to care deeply about your customers and invest heavily in the data that guides what ideas you work on. Because the data matters, so do the value-adding tools from Six Sigma.

This inbound work intentionally creates data that helps the team develop desired forms of variation. Here, Six Sigma helps to identify forms of variation that actually create value. Product portfolios are, by nature, a variety of offerings based upon a blend of technology dynamics and customer behavior dynamics, and sometimes customer dynamics drive technology development. Rarely is technology 100 percent dominant as a driver of customer behavior. Customer behavior generally takes the lead in the dance of sustained growth.

This strategic set of tasks requires a close partnership with technologists, marketing and product-planning professionals. Strategic inbound marketers focus on characterizing emerging customer behavioral dynamics, competitive marketing trends, and brand dynamics. Strategic inbound technologists focus on characterizing emerging technology dynamics, competitive technology trends, and intellectual property dynamics.

The Phases of Product and Technology Portfolio Definition and Development

In the strategic technical process environment, we have identified a generic process of four distinct phases, as follows:

• Identify-Markets, their segments, and the opportunities they contain.
• Define-Portfolio requirements and product portfolio architectural alternatives.
• It is at the end of the Define phase that we define and activate technology development projects.
• Evaluate-Product portfolio alternatives against competitive portfolios.
• Activate-Ranked and resourced individual product commercialization projects.

These four phases of work (whose acronym is IDEA) form the basis of how data can be developed in reasonable batches so that the strategic portfolio renewal team can manage risk and make decisions.