The Agile Stage-Gate Model
The Agile Stage-Gate Model: Opportunities and Challenges (possible title)
This article will explore the Agile-Stage Gate (AGS) framework, an innovative hybrid approach that merges agile elements in linear and plan-based management methods. A lot of articles have been written about the structure of the two methods: here the goal is to explain how two different (almost opposite) systems can be merged and create a new, efficient, and reactive solution that preserves the advantages of both models. In the last decades, linear methods like Stage-Gate® have shown better results in delivering high-quality products on time. Nowadays, the ability to adapt quickly to the client’s needs is an essential requirement for business competitiveness, and feedback-based adjustments have become part and parcel of modern processes (Sommer et al. 2015). Recent studies on AGS show significant improvements in several areas, such as the communication ability with internal and external stakeholders, the understanding of progress metrics and control procedures, as well as the engagement of the team (Cooper, Sommer, 2015). Nevertheless, there is still extensive room for improvement, and its limitations offer new challenges for project managers of tomorrow. To describe AGS clearly, it is necessary to explain its parts also. Therefore, in the first section of the article, the traditional stage-gate process will be described– what it is and how it works. In the second part, agile elements In the third part, the core of the article will be unfolded: here the traditional Stage-Gate model will be explained, also providing some frameworks to understand its general functioning. Then, a real application case study will be discussed, and its outcomes evaluated to move from theory to practice and help practitioners visualize a possible implementation. The article doesn’t want to be a generic guide on “how the model works”: starting from the idea that implementation of both models is possible, its contribution is to reflect on how a project manager can introduce a tailored agile solution in a plan-driven process. BIG IDEA
Improving the Traditional Stage Gate® with Agile principles
Today, the Stage-Gate® model is widely used in North – America, with eight out of ten companies utilizing it. (https://www.stage-gate.com/about/our-story-2/). The model was formulated by Robert G. Cooper around 1990, claiming that innovation is a process, and “like other processes, innovation can be managed” (Cooper, 1990). To do so, Cooper introduced a model that gives a rigid and plan-based structure to the idea-to-launch process in new product development, alternating evaluating and assessing stations called “Gate” to more operative “Stage”.
File:(insert stage-gate visual scheme)
Stage-Gate model (Jetter, A., Albar, F., & Sperry, R. C. (2016). The Practice of Project Management in Product Development: Insights from the Literature and Cases in High-Tech. PMI Sponsored Research, pag. 14)
GATE
A Gate is a set of expected results that must be met by the project leader to access the next Stage. The project leader enters a Gate with some “deliverables” which are evaluated through some predetermined “exit criteria”. These criteria may vary from one project to another, but generally, they should be a set of benchmarks for the strategic, marketing, and financial aspects of the project. In the beginning, these standards are mostly qualitative, while they gradually become more quantitative in the final stages. (Cooper, 1990, pag. 50). The respect of criteria needs to be assessed by an experienced manager, whose knowledge plays a key role in the decision-making process. Management oversees the greenlighting of the heavy spending decision through the path and helps the team meet the deadlines. Furthermore, involving senior managers is a crucial factor in the success of the project even from the point of view of the company: management's commitment and support are fundamental in aligning the project's development with the organization's objectives. (J. Edgett, 2015) The output of a Gate results in a Go/Kill/Hold/Recycle: - GO: the project fulfills and respects the desired criteria. It can move on to the next stage. - KILL: the project cannot progress - HOLD: the project must wait to be completed, or it can move forward fulfilling some requirements - RECYCLE: the project needs to be improved before the next stage.
STAGE
If the deliverables satisfy the exit criteria, the project can move on to the next Stage. As its inventor has stated, a Stage can be defined as “a set of required or recommended best-practice activities needed to progress the project to the next gate or decision point” (Cooper, 2008). In each stage, cross-functional types of analysis are carried out concurrently by multidisciplinary teams of individuals coming from different areas of the company. By gathering information, both the project leader and the management will have about the key feature of the project. Since every stage has incremental costs, the knowledge acquired thus mitigates the risk and offers a broader vision and an analytical approach to decision-makers rather than relying on intuitions (Cooper, 1990). The first formal Stage-Gate® model introduced by Cooper consisted of five main stages: 1- Preliminary assessment: Users’ feedback about the concept is gathered through quick research to evaluate how the product would be perceived by the customers. (Cooper 1990, pag. 52) 2- Definition: In this stage, the customers’ preferences are deeply analyzed. Thus, the team can describe the basic principles of the product and assess the first approximate financial and technical prospects. Here also legal matters are considered. 3- Development: the design of the product is finally developed, and all operative needs and processes are clearly defined. 4- Validation: once the product is ready prototyped and ready to be produced, the company has to test it, to evaluate its quality. The customer plays a crucial role in helping the producer understand if the usability of the product is by what has been stated in the previous stages. After the first tests, more information is available and can be used to improve the product and the production process. Furthermore, considering the new data, the financial prospect of the entire project can be reassessed. (Cooper 1990) 5- Launch: The product is finally launched on the market, and production can start. (Cooper, 1990) (maybe extend the descriptions of the stages) Every stage-gate model must be tailored to the, so its formula may vary from one company to another, or from one project to another.
The Hybrid Model
Agile: a way of thinking
The primal ancestor of Agile practice can be found in Deming’s PLAN-DO-CHECK-ACT (PDCA) Cycle and its first application was in the Japanese automotive industry. This means that, even if the IT sector was the first field to be innovated, Agile roots have to be found in manufacturing. Agile and Scrum, the most used framework in hybrid stage-gate models, don’t have the same meaning. Scrum is a framework, and agile techniques embed some Scrum features. (Abbas et al. 2008). In “The New New Product Development Game” Takeuchi and Nonaka formulated a rugby-inspired approach looking at management methods of different companies, such as Honda, Canon, and Hewlett-Packard. The authors seemed to see forward in the future of the development of hybrid methods: as they stated: “Just as important, the new approach can act as a change agent: it is a vehicle for introducing creative, market-driven ideas and processes into an old, rigid organization.”(Takeuchi Hirotaka and Ikujiro Nonaka, 1986) - Some examples of agile techniques The integration of Agile methods in long-established procedures can be a difficult challenge, as the change of management makes the complexity rise. Taking responsibility, self-management, transparency, and peer agreement are the keywords of the method. Agile is a way of thinking, and it has to deal with the culture of the organization. All these features must be understood by the management and applied properly in line with the goal of the organization. (Maximini and Rauscher, 2018) Scrum is the most applied Agile framework to Stage-Gate®.
Scrum
Scrum is a framework that relies on three fundamental pillars: - Transparency: the communication between participants must be clear, reporting the three Artifacts (The Product Backlog, The Sprint Backlog, and the Increment) as they are to enhance the improvement process. - Inspection: artifacts must be revised, as the state-of-art of the situation. This happens iteratively during the Sprint. - Adaptation: when an inspection suggests a change to the deliverable, it must be done immediately to preserve the quality of the product.
The Team These three concepts must be always kept in mind by the Product Owner, the Scrum Master, and the Developers (called “Team” by Schwaber in “Agile Project Management in Scrum”). The Product Owner is who makes clear the need-and-want of all the stakeholders to the Team. He is in charge of monitoring the financial aspects of the project, establishing the deadlines, and gathering and prioritizing the requirements in the Product Backlog (Schwaber, 2004). All the items listed in the Product Backlog have to be aligned with the Product Goal, the “platonic idea” of the final product. The Team, usually composed of people from different functions, has the only goal of turning the list of the backlog into reality, adding value to the prototype. This added-value feature is called Increment. As is stated in “The Scrum Guide”: “The moment a Product Backlog item meets the definition of done, an Increment is born” (The Scrum Guide, Ken Schwaber & Jeff Sutherland 2020). The last main character in Scrum is the Scrum Master. The Scrum Master is the leader of the Scrum Project. His role is crucial, as he has to support the other members to apply the Scrum theory to every new context. (Schwaber, 2004). - The Artifacts: a brief explanation - The Sprint: a brief explanation
The Agile Stage-Gate
- Agile Stage-Gate: the general scheme - Benefits
APPLICATION: Tailoring the Hybrid Model to the Project
What tailoring means from a project management perspective - Notions from the PMI book about tailorin
A framework to tailor Agile principles in well-established procedures - The model proposed by Felix J. Brandl (et al. 2021) Traditional or Hybrid Stage-Gate? The Hybrid Model Matrix More and more companies are embracing new hybrid models for new product development. For those organizations that want to update to new frameworks, it could be difficult to choose a suitable framework for a specific product development project. Cocchi et al. (2021) introduced an innovative decision-making tool for program and portfolio managers, the Hybrid Model Matrix. The matrix is a result of a case study carried out on a firm in the food industry. This company already applied hybrid methods combining Stage Gate with Agile, Lean Start-up, and Design Thinking. In a nutshell, … Although the company applied the most recent techniques, it lacked a structured framework that can facilitate the appropriate methodology to be employed for a particular project. The choice of the model depended on the management’s on-the-field knowledge and their ability to evaluate resources in conjunction with the financial return of the project. (Cocchi et al, 2021). The matrix provides some useful guidelines for the agile methods implementation. The matrix states two important factors to consider in the implementation: - Knowledge about Users (KAU): this could be “wide” or “limited” and it refers to the point of view of the customers. “Wide” means that the company is aware of costumer’s tastes and preferences. The target is clear. On the contrary, when the KAU is “limited” it indicates a knowledge gap in understanding the customer’s need. - Knowledge about Product Category (KAPG): this indicator includes a broad range of elements that define how is deep the knowledge of a company for a specific product. This involves the strategic relationship with stakeholders and market positioning. Limitation - Limitation of Agile Stage-Gate - Implementation Challenges
References'
1. Nicolò Cocchi, Clio Dosi & Matteo Vignoli (2021) The Hybrid Model MatrixEnhancing Stage-Gate with Design Thinking, Lean Startup, and Agile, Research-Technology Management, 64:5, 18-30, DOI: 10.1080/08956308.2021.1942645 2. Maximini, Dominik, Maximini, and Rauscher. Scrum culture. Springer International Publishing AG, part of Springer Nature, 2018. 3. Schwaber, Ken, and Jeff Sutherland. "The Scrum Guide. 2020." Accessed April (2021). 4. Schwaber, Ken. Agile project management with Scrum. Microsoft press, 2004. 5. Abbas, N., Gravell, A.M., Wills, G.B. (2008). Historical Roots of Agile Methods: Where Did “Agile Thinking” Come From?. In: Abrahamsson, P., Baskerville, R., Conboy, K., Fitzgerald, B., Morgan, L., Wang, X. (eds) Agile Processes in Software Engineering and Extreme Programming. XP 2008. Lecture Notes in Business Information Processing, vol 9. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-68255-4_10 6. Takeuchi, Hirotaka, and Ikujiro Nonaka. "The new new product development game." Harvard business review 64.1 (1986): 137-146. 7. Felix J. Brandl, Nina Roider, Martin Hehl, Gunther Reinhart, “Selecting practices in complex technical planning projects: A pathway for tailoring agile project management into the manufacturing industry”, CIRP Journal of Manufacturing Science and Technology, Volume 33, 2021, Pages 293-305, ISSN 1755-5817, https://doi.org/10.1016/j.cirpj.2021.03.017. 8. Sommer, Anita & Hedegaard, Christian & Dukovska-Popovska, Iskra & Steger-Jensen, Kenn. (2015). Improved Product Development Performance through Agile/Stage-Gate Hybrids: The Next-Generation Stage-Gate Process?. Research-Technology Management. 58. 10.5437/08956308X5801236. 9. S. J. Edgett, “Idea‐to‐Launch (Stage ‐ Gate) Model : An Overview,” Stage-Gate Int., pp. 1–5, 2015 10. Robert G. Cooper, Stage-gate systems: A new tool for managing new products, Business Horizons, Volume 33, Issue 3, 1990, Pages 44-54, ISSN 0007-6813, https://doi.org/10.1016/0007-6813(90)90040-I. (https://www.sciencedirect.com/science/article/pii/000768139090040I) 11. Cooper, Robert. (2008). Perspective: The Stage‐Gate® Idea‐to‐Launch Process—Update, What's New, and NexGen Systems*. Journal of Product Innovation Management. 25. 213 - 232. 10.1111/j.1540-5885.2008.00296.x.
