Dear RPers
I would like to apologise for any inconvience arising from me sending an
attached word document to the mailing list yesterday. It was my first
effort and apparently a rather poor one, my lapse was due to my inexperience
and I would like to thank those of you who notified me of my breach of
etiquette, I will make sure it does not happen again!
It was also pointed out to me that many subscribers would have been unable
to view the document anyway so I have retyped it below.
Sincerely Rohan Tink (Scott is innocent)
My name is Rohan Tink, I am working for the Queensland Manufacturing
Institute in Brisbane, Australia. The current focus of my work is the
development of a model for quantifying the financial benefits of utilising
RP technology and other accelerated product development practices to reduce
a products time to market.
I have based much of my work on Preston Smith's four trade-off rules (see
"Developing Products in Half the Time"). I am developing a program in
Microsoft Access 95 which takes into consideration:
- projected product life cyle, and average sales over each period within the PLC
- projecedt average cost per unit and sale price per unit for each period
over the PLC
- budgeted expenditure for engineering, marketing, administration and
operating expenses.
This information is all readily available from a company's marketing plan.
Unfortunately simply calculating the cost of losing "X" months of mature
sales, ignores significant market variables such as:
- loss of market share to competitors and the associated loss of brand
loyalty and awareness
- opportunity to capture key suppliers and distribution channels
- the comsumption/usage characteristics of consumers
- seasonality within the market
In accordance with Smith's findings, I intend to start with a sales baseline
(generated from the projected sales in the marketing plan) to which a series
of weightings will be applied depending on qualitative answers surplied for
questions about:
- strength of competition within the market
- proliferation and availabilty of replacement/alternative products
- demand elasticity
- seasonality
- importance of product performance over other customer evaluation criteria
such as image or familiarity with format/brand/function etc.
I hope to generate suitable values for the weightings by compiling case
studies which feature quantified cost/benefit analysises (rarer then hens
teeth). These values could then be adjusted by experienced experts, who
could compare their own market to those in the cases. Should anyone be able
to point me in the direction of some good quantified ($ cost, $ benefit,
time saved) case studies, I would greatly appreciate it. At present the only
good one I have is a HPM case study.
To determine which weightings to apply for a given market, product
developers will be required to answer questions pertaining to the demand for
the product and its effect on the PLC. Eg.
1. What is the most likely cause for the decline in demand -
- technical obsolecence
- changing fashion
- market saturation
- excessive competition etc.
2. What is the nature of product consumption:
- one off purchase
- consumable independant of other products (eg. food)
- consumable dependant on other products (eg. laser printer paper)
etc
While this project does not directly relate to RP technology I'm sure you
will all acknowledge the need to provide potential users with a means to
better evaluate the benefits of utilizing RP services. I would greatly
appreciate any ideas as to how to better refine the model. I would also
appreciate any information to point me in the direction of case studies or
companies willing and able to supply the information I require.
My sincere thanks in advance
Rohan Tink
Queensland Manufacturing Institute
C- Scott Roemermann
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