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• Given your total R&D budget, estimate the maximum number of projects you can undertake within each category:

– Need to have a handle on resource requirements for each type of project

Step 4: Commit to Specific Projects

• Compare project proposals within categories—not across:

– Platform ideas compete with other platforms

– Derivative project ideas compete with other derivatives

• Use different criteria across categories:

– Derivative: ROI or NPV

– Platform: impact on future options in the market

– Breakthrough: longer term capabilities/options

• Senior management’s job is to actively manage the process:

– Shape the menu of choices, don’t just passively select what’s presented

Source: These notes are adapted from teaching case files in the Technology and Operations Management department at Harvard Business School, and adapted from the original material in Revolutionizing Product Development: Quantum Leaps in Speed, Efficiency, and Quality, by Stephen C. Wheelwright and Kim B. Clark (New York: The Free Press, 1992).

The Road of Trials

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chapter nine

IT and the Board of Directors

Tuesday, June 12, 10:53 a.m. . . .

“I’m not sure about the order we’ve got these in,” said Raj Juvvani.

“Maybe we should list ‘Underinvestment in IT’ first. That way we hit

them with the biggest, most important thing at the outset.”

“I disagree,” said Tyra Gordon. “That’d be like starting by accusing

them of causing IT difficulties—it’s their fault because we haven’t spent

enough.”

“It kind of is their fault we haven’t spent enough on IT,” countered

Juvvani.

“Yes,” conceded Gordon, “but that doesn’t mean we should start

there. It’d be like shoving a tin cup under their noses in our first mo-

ments with them

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