StageTM Gate Method: Product Development Process
March 22, 2012
What is Stage-Gate?1
A Stage-Gate® process is a conceptual and operational map for moving new product projects from idea to launch and
beyond – a blueprint for managing the new product development (NPD) process to improve effectiveness and efficiency.
Stage-Gate is a system or process not unlike a playbook for a North American football team: it maps out what needs to
be done, play by play, huddle by huddle – as well as how to do it – in order to win the game.
Stage-Gate, in simplest format, consists of (Exhibit 1):
 A series of stages – where the project team undertakes the work, obtains the needed information,
and does the subsequent data integration and analysis
 Followed by gates – where Go/Kill decisions are made to continue to invest in the project.
The structure of each gate is similar. Gates consist of:
 Deliverables – what the project leader and team bring to the decision point (for example, the results
of a set of completed activities). These deliverables are visible, are based on a standard
menu for each gate, and are decided at the output of the previous gate.
 Criteria against which the project is judged. These include must meet criteria or knock out questions (a checklist)
designed to weed out misfit projects quickly; and should meet criteria that are scored and added (a point count
system), which are used to prioritize projects.
 Outputs – a decision (Go/Kill/Hold/Recycle), along with an approved action plan for the next stage (an agreed-to
timeline and resources committed), and a list of deliverables and date for the next gate.
Exhibit 1: A typical Stage-Gate Process
Stage 0 Stage 1 Stage 2 -
Discovery: Activities designed to discover opportunities and to generate new product ideas.
Scoping: A quick and inexpensive assessment of the technical merits of the project and its market prospects.
Build Business Case: This is the critical homework stage - the one that makes or breaks the project. Technical,
marketing and business feasibility are accessed resulting in a business case which has three main components:
product and project definition; project justification; and project plan.
Stage 3 - Development: Plans are translated into concrete deliverables. The actual design and development of the new
product occurs, the manufacturing or operations plan is mapped out, the marketing launch and operating plans
are developed, and the test plans for the next stage are defined.
Stage 4 - Testing and Validation: The purpose of this stage is to provide validation of the entire project: the product itself,
the production/manufacturing process, customer acceptance, and the economics of the project.
Stage 5 - Launch: Full commercialization of the product - the beginning of full production and commercial launch.
A Scorecard for Project Selection – For the new products’ bucket
New-product projects are scored by the gatekeepers, using these six factors on a scorecard (0 – 10 scales). The scores are tallied &
1.
Adapted from Robert G. Cooper and Scott Edgett: http://www.stage-gate.net/downloads/working_papers/wp_30.pdf
StageTM Gate Method: Product Development Process
March 22, 2012
displayed electronically for discussion. The Project Attractiveness Score is the weighted or unweighted addition of the six factor
scores, and taken out of 100. A score of 60/100 is usually required for a Go decision.
Factors
Factor 1: Strategic Fit & Importance
• Is the project aligned with organization’s business strategy?
• How important is the project to the organization’s business strategy?
• How much of an impact will the project have on the business?
Factor 2: Product & Competitive Advantage
• Does the product deliver unique customer (or user) benefits?
• Does the product offer customer (or user) excellent value for money (compelling value proposition)?
• Is the product differentiated in eyes of customer/user?
• Has the product concept received positive customer/user feedback (concept test results)?
Factor 3: Market Attractiveness
• Does the product have a large market size?
• Does the product have a large projected market growth & future potential?
• Are your competitors gaining large margins in the market?
• Is the market saturated with competition (negative value)?
Factor 4: Core Competencies Leverage
• Does the project leverage your core competencies & strengths in:
• Technology?
• Production or Operations?
• Marketing (image, brand, communications)?
• Distribution & sales-force?
Factor 5: Technical Feasibility
• What is the size of technical gap (straightforward to do)?
• Is the product technical complex (few barriers, solution envisioned)?
• Is the product technology familiarity to your business?
• What is the technical track record on these types of projects?
• Have the technical results to date (proof of concept) been favourable?
Factor 6: Financial Reward versus Risk
• What is the size of financial opportunity?
• Is there a high financial return (NPV, ECV, IRR)?
• How does the Productivity Index (PI) measure up?
• What is the certainty of financial estimates?
• What is the level of risk & ability to address risks?
1.
Adapted from Robert G. Cooper and Scott Edgett: http://www.stage-gate.net/downloads/working_papers/wp_30.pdf
Score