Smarter product development process depends on demand insight, sound infrastructure
by Staff -- Manufacturing Business Technology, 8/1/2005 6:00:00 AM
The ability to develop new products is a competitive advantage. But few manufacturers can know for certain whether a new product will be a big hit—or a colossal bust—until after it's on the market.
H.J. Heinz, the Pittsburgh-based food products conglomerate, is one of those rare manufacturers that can separate the winners from the losers early on, thanks to its highly disciplined product development process.
Philip Heil, global program director for information systems, says the Heinz product development process succeeds for two primary reasons: it responds to actual customer demand, and it's supported by a technology infrastructure that forces everyone involved in the process to follow a specific set of rules.
The central piece of the technology infrastructure is a product life-cycle management (PLM) application from Prodika. Heinz modified the package slightly to create a system that's known within the company as VIPER—which stands for vendor improvement, product enhancement, and research.
Heil says the name stems from the system's ability to reach back into the supply chain—enabling communication with both customers and suppliers—and send information to the Heinz product development teams that can be used to improve both new and existing products. "It also provides a level of discipline—by enforcing the use of standard approval procedures—that not only allows us to get products to market faster, but also ensures more people are taking a critical look at products through all phases of the process," he adds.
A winning approach
The end result, Heil says, is the number of new Heinz products that could be considered hits clearly outnumbers the busts.
The launch of the Smart Ones line of frozen foods is a prime example of how the Heinz new product introduction process works. "Our marketing department was getting a lot of feedback about consumers' growing interest in low-carbohydrate lifestyles and things like the Atkins and South Beach diets," Heil says.
Before long, every department—from engineering to manufacturing, purchasing, and regulatory affairs, as well as outside suppliers—was contributing suggestions on the best way for Heinz to produce and sell its own line of low-carb foods. The Heinz technology infrastructure, including Web-based supplier portals and XML Web services, made these discussions more productive.
For example, Heil explains, product developers could place a draft bill of material (BOM) for a proposed product in the VIPER vault, and then use links created between VIPER and other business systems to explore which ingredients included in the draft BOM were already used in other Heinz products. They also could see which vendors supplied those ingredients, what factories they produced them in, and how reliable those vendors were at delivering quality ingredients on time.
Shared success
Product development teams at any Heinz facility around the world have this same level of information access. "It's a genuine end-to-end communication process, running as a single instance throughout Heinz," says Heil.
Once a product has been approved for development, the workflow engine embedded in the Prodika suite shepherds it through the formal introduction process. All relevant data about the product is fed to VIPER, and the workflow engine routes it to each person required to examine that data and take action. The system will not allow development to proceed until each person on the routing list completes the required tasks.
In addition to making products like the Smart Ones line a commercial success, Heil says VIPER has helped Heinz lower the cost of developing all of its products by making it easier to use common ingredients across product lines and consolidate its purchases among a smaller number of suppliers.
"It's a real foundation for making PLM a truly strategic application within the business," Heil says. "We're not chasing bits and pieces of information from a network of systems around the world—everyone can get all the information they need right from their desktops."
