This blog post examines how experience strategies accelerate development speed through intuition, iteration, and prototyping in highly uncertain markets, exploring how companies can respond nimbly to change.
There are two primary strategies for developing new products. One is the compression strategy, which can be described as streamlining the development process. This strategy is characterized by the ability to shorten the product development process, which consists of predictable stages. Since the sum of each stage constitutes the entire process, this strategy focuses on reducing the time required at each stage. To achieve this, it involves clearly establishing and analyzing a series of steps, then accelerating product development through so-called ‘squeezing’.
The compression strategy requires significant time investment in ‘planning’. This planning process contributes to reducing time spent on communication and task coordination by eliminating unnecessary steps and arranging activities in an efficient sequence. It also simplifies development stages by leveraging the specialized expertise of partner companies, allowing the development team to focus more intensely on core tasks. Furthermore, it reduces development time and potential errors by reusing past designs accumulated in databases, and saves time by partially overlapping consecutive development stages.
The successful execution of this strategy is deeply tied to the operation of cross-functional teams. If cross-functional teams operate effectively, solidifying collaboration across departments, the development process will become significantly faster. Reward systems can drive the determination and focus needed to complete development within the planned timeframe, thereby boosting performance. However, they can also have the side effect of encouraging the selection of relatively easier projects when choosing new product development targets.
In contrast to the compression strategy, the experience strategy posits that simply compressing and accelerating existing processes is insufficient for rapidly bringing products to market. This strategy is chosen in environments with high uncertainty, such as when market conditions are opaque or cutting-edge technology must be applied. To respond to unclear and changing environments, it emphasizes cultivating intuition and flexibly employing diverse alternative approaches. This approach is seen as enabling rapid learning in uncertain environments and agile responses to change. Therefore, it is a response to uncertainty rather than certainty, and it is iterative rather than linear, and experiential rather than planned. It emphasizes accelerating product design through prototyping, believing that repetition can increase new product development speed.
This strategy prioritizes immediate decision-making, real-time exchange and experience, and flexibility. It also tends to accelerate product development through frequent milestone management and the placement of strong leaders. Milestone management involves formal evaluations but is not rigidly planned in advance. Instead, it involves continually reassessing current progress to prevent course deviation and check responses to changing markets or technologies, thereby serving to coordinate development activities that could become chaotic due to iteration and experimentation. If team members lose sight of the ‘big picture’ amidst countless iterations and experiments, the development process risks spiraling out of control. Strong leaders play a crucial role in preventing this situation and ensuring no delays occur in the development process.
