This is a “story of two strategic initiatives” at Intel. Each initiative involved improving the productivity of the product development process. Insiders regard the first initiative as a failure but the second one as a success.
Intel’s First Initiative Failed to Get Traction
Intel’s first strategic initiative for product development was not judged as a success, despite the many good practices applied to the effort. These practices include chartering a team of good people who took the time to identify healthy practices used by leading companies (see the below section titled, Sidebar: Excellence in New Product Development). The team documented the previously undocumented and produced a helpful 3-inch binder that described the model process, decision criteria, and supporting check lists.
The team faltered with this important task: working within or around the culture to adopt the proposed toolset. The team pushed this new product development process onto their partner organizations with the idea that the partner organizations would conform to the new unified process. Unfortunately, the partners perceived the new process as “arduous” and “onerous.” The problem?
“The vision was not communicated in a way that middle management could understand it. The value proposition was a mystery to them. But the most significant issue was the lack of clearly-defined next states that were palatable for the maturity of the organization.”
Become Skilled at Working With Culture, Strategy, and Change
The quote above mentioned vision, communication, middle management understanding, value proposition, next steps, and maturity as key concepts. The word culture conveniently captures those concepts.
A consistent theme across all strategic initiatives is the need to recognize the role of culture in organizational performance and skillfully design strategies and programs to navigate the culture.
Success with the Second Strategic Initiative
Often it takes a crisis to cause an organization to make changes.
In Intel’s case, Michael Dell of Dell Computers informed Intel’s CEO Andy Grove that Intel was Dell’s worst supplier of a key component. Andy Grove acted quickly, first calling 1500 people into a cafeteria where he calmly and eloquently spoke about the importance of quality. The second meeting was with a select group of middle managers. One of the managers reported,
“Andy was eloquent in a different way. He was angry and he let the heat show. There was no ambiguity. He wanted it fixed. Money was not an object, but money wasn’t the answer. We didn’t know what was broken.”
Obviously, the attention of the CEO was helpful for establishing the case for change and gaining some initial traction. But it took the efforts of the entire Intel organization to realize the benefits. Similar to other strategic initiative case studies that I have described, Intel experience was a journey that required skill, sacrifice, and perserverance.
The result of this second strategic initiative: Intel achieved new levels of quality, speed, and new product development productivity.
Sidebar: Excellence in New Product Development
In comparison to organizations with ad hoc product development practices, there are numerous leading companies with a consistent, structured development process that are both speedy and efficient. (Professional associations like the Product Development and Management Association or the Project Management Institute regularly report on these leading companies.) Companies with this solid and structured development process are able to compete better.
They select the right projects for their portfolio. They do not overload the development pipeline. They give their project teams the tools to get the job done.
It is important to note that the development of these “good” processes involves discipline, and discipline usually involves pain. One of the needed competencies of the strategic initiative leader is to recognize the pain and work to balance perceived benefits and perceived cost.
More Learnings on Cultural Change
Here are some more key learnings noted by Intel:
- Organizational pain comes in many forms; the key is how to use it to your advantage
- As things become more complex, focus more on conveying the next steps
- Set clear expectations
- Develop and use feedback for what is working and what is not
- Take small steps towards the ideal model
- Work to harmonize the initiative with all other initiatives
- The product life cycle is strategic and needs to align with investment decisions and strategic goals
- Remember the imperative for delivering business results (benefits); it is easy for people to get lost in process minutiae and documentation
- There is value in “user focused solutions”
- Recognize that some organizational units will adopt and execute faster. Use their learnings and examples with slower innovating organizational units
[Note: this article draws extensively on CR Galluzzo and Deanna Bolton, Making the Product Development FrameWORK]
- Case Study: Strategic Initiative Kickoff in a Global Joint Venture (leadingstrategicinitiatives.wordpress.com)
- Incremental Benefits Delivery: The Key to Sustaining Commitment to Strategy (leadingstrategicinitiatives.wordpress.com)
- Strategic Initiatives | Executive Sponsor Roles, Power, & Politics (leadingstrategicinitiatives.wordpress.com)
Copyright – Greg Githens. Please properly attribute this article.
I like this article – a very interesting contrast. My initial reaction is regarding the failed initiative. You list 3 things they did right. The 3rd one caught my attention as a problem – “a helpful 3-inch binder”. That strikes me as an oxymoron. The key learnings section summarize the problem fairly well, in that you need to address each business unit differently with process changes. Don’t go in with the whole solution – start with the goal, and let the business units take ownership of how they will solve the problem.
On the 2nd case, the successful one, it’s great to see they had strong executive support. This appears to have been the key ingredient, starting the initiative with a clear goal and direction – clears away questions of priority very nicely.
Jason, WRT to the 3-inch binder, I have to agree with you if you are suggesting that documentation should not be the sole purpose of improvement. Documentation (the binder) is a job aid that helps to explain the process. It should make people’s job easier.
Many times people are overwhelmed by thick documents of policy or methodology, and they ignore or subvert it.
A better way is, “just enough process, just in time.”
Thanks for your comments
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