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Apple’s New Product Development Process Case Study
Many companies face internal problems because they can’t see the bigger picture.
I came face to face with this reality while working with Apple.
What Apple had was the right ideas. They lacked a concise way to take those ideas and make them into tangible products; they needed product management tools to scale their new product development to the next level.
There were two significant issues in their new product development process:
The first problem was reinventing the wheel every time a new product was launched. The second problem was that each team was interdependent on the other. One product team’s quick decision could impact the work of the parallel team. This created a possible cycle of one team destroying the progress of another.
In short, the product development process was tribal. To scale, they needed to change.
Further, teams were inefficient, and the weight of this inefficiency landed on the manager’s shoulders. The managers were weighed down with attempting to reinvent the wheel and putting out the day-to-day fires the other product teams (and product managers) were causing in the design process. Apple struggled to achieve its most significant goal, scaling up.
After their fourth attempt at identifying the product development best practices, my colleague Jeanne Bradford, who worked in the Cupertino HQ (working for the manufacturing and global supply manager), and I brought on to find the golden intersection between idea and creation.
We took a four-step approach to transform Apple’s new product process, the TCGen consulting approach we use regularly with our clients. Steve Jobs is not against the process; he is just against too much process. He liked combining innovation with rapid iteration to create one of America’s most admired companies.
Step 1: New Product-Focused Assessment
Idea Generation
Bradford and I took a general assessment, including idea generation, market research, and brainstorming. We used its findings to pinpoint several improvement levers, including improvements for the design teams. These levers addressed issues like the product teams crashing each other’s latest innovations and fostering a more collaborative and efficient environment. By incorporating idea generation and market research into the assessment process, we aimed to capture various innovative concepts, potential product ideas, and insights about the target market and customer needs.
Each lever we identified had the potential to bring about improvements to a certain degree. We prioritized the levers that would significantly affect the overall product development process to ensure maximum impact. By sequencing and addressing these levers in order of priority, we aimed to create a structured approach that would lead to tangible improvements in idea generation, design, market research, and overall product development outcomes. This approach would be crucial in developing a solid business plan based on the new product ideas and aligned with the needs and preferences of the target market.
Predictive Metrics and Business Analysis
For each of these key improvement levers, we created a target metric. We wouldn’t move on to the next level until the one prior was established. We would move on to the next priority only when we achieved our target metric. The product concept and development strategy aligned with the market need and target audience, ensuring our efforts focused on delivering a competitive advantage and capturing market share.
This general assessment and product development metrics separated our efforts to improve the product development process from the earlier attempts. By implementing a structured approach and aligning our actions with the business plan, we could strategically navigate the product life cycle, identify and address the market need, and effectively position our product to gain a competitive advantage and increase market share.
Step 2: Set Boundary Conditions
The most crucial part of transforming the product process was establishing product management tools like boundary conditions and out-of-bounds procedures. This was vital to the Apple New Product Process (ANPP).
Boundary conditions are a contract between the teams and management. At the start of each project, the team and management negotiate a contract around approximately five dimensions of a project:
- Product Cost
- Features
- Schedule
- Quality
- Reliability
Each boundary condition identifies the team’s big, bold aspiration for its project. The team and management then agree on quantitative thresholds for each boundary condition. For example, a target cost for the product at retail or a “no later than” date for delivery of a product being shown at a trade show.
The success of the boundary conditions process lies in defining a quantitative metric for each dimension.
As long as each team expects to remain within its pre-defined boundary conditions, upper management leaves the team alone. If the team predicts they will cross a boundary, called a boundary break, they have an escalation process. This process is the out-of-bounds process.
There are two solutions for an out-of-bounds process.
Solution #1: The team emails management proposing the solution to the boundary break. If management agrees to the team’s solution, a new quantitative metric is decided upon, and the team proceeds as it was.
Solution #2: If management doesn’t agree to the team’s solution, then a meeting is held where the management and the team agree and create a new quantitative metric as their target.
After completing the out-of-bounds review, the team and management continue as they were. This approach ensures teams don’t get micromanaged and provides a clear escalation path if projects don’t go according to plan. This measure ensured that we did not run afoul of manufacturing practicalities, and we followed the rules of the road and supported the design team, the development team, Engineering Project Management (EPM), and Global Supply Management (GSM) to the final product.
Step 3: Overcoming the Cultural Hurdle
Convincing management to empower the teams was a significant challenge. For example, they refused when we asked managers to remove weekly status meetings. They still wanted weekly updates despite knowing a team was working within boundary conditions. This created a repetitive, time-wasting system.
If a team was within their boundary conditions, set to meet their quantitative metrics for each dimension, there was no need to hold an hour-long meeting to explain their progress to management. Management knew their progress already because they were within their boundary conditions.
We continued to find resistance in many culturally everyday Apple practices, finding ourselves having to convince employees this process would make their jobs easier. Some of the most significant elements we had to work with were their product design process (including industrial design and user experience design), which was essential to preserve or enhance.
Apple’s design process and leading with great products are fundamental to who they are. Jony Ive was an authentic second voice that married great design with functionality. It sets Apple apart from other great companies like Amazon and Microsoft.
Step 4: Implement Apple’s Product Development Process
After we convinced employees they would be happy with these changes, we implemented a test trial. We tested our product process with several teams and key executives. This was mainly a learning exercise to understand the specifics of implementation. With a complete understanding of how our process worked in real time, we held a workshop to train all relevant stakeholders, including several sessions with the executive team.
Teams working within boundary conditions consumed less of management’s time. When projects strayed from their initial goals, the out-of-bounds process kept the project’s momentum while we moved toward achieving our quantitative metrics. One of the most successful parts of our process was the improved relationship between management and teams. Apple was no startup when we worked with them, so the team and management needed to work together – and they did.
Bradford and I successfully transformed Apple’s new product development environment by incorporating validation and customer feedback at every stage of the product development process. We recognized the importance of gathering insights directly from customers to ensure the development of a successful product. This iterative approach enabled us to gather valuable feedback and make necessary adjustments before progressing to the next stage, ensuring that the final product would meet customer needs and expectations.
Driving Effective Product Management and Concept Development for Scalable Success
The ability for companies to scale depends on achieving product development maturity. You can achieve Apple’s largest mission if your process is built on quantitative results with sideline processes established to fix unforeseen problems. Along with a robust pricing strategy and an empowered product development team, consistent validation and integration of customer feedback are essential for driving success in bringing new business ideas to market.
Apple has continued to scale for years. ANPP is now the guiding principle with iPhone, iPad, iPod iMac, and Mac (Macintosh) business units.
Apple’s Effective Processes: A Closer Look at Additional Key Factors
In the dynamic product development landscape, Apple has established itself as a global leader and consistently introduced innovative and groundbreaking products. Central to their success was a meticulous and well-executed marketing strategy that drove the commercialization of their new offerings. By leveraging a comprehensive understanding of pricing, existing products, feasibility, and new product ideas, Apple became synonymous with cutting-edge technology and exceptional user experiences.
Additional Key Factors Gleened from Recent Public Writings About Apple
Apple’s Marketing Strategy and Commercialization in the Product Development Journey
Apple’s product development activities are product vision-led. Apple creates and defines the concept with a lot of customer validation, and then, when they’re further down the road map, they might check some details when getting customer feedback, which would be useful. This crucial step involved considering market share potential customers and exploring new markets to identify untapped opportunities. Through careful consumer needs and preferences analysis, Apple’s marketing plan was designed to resonate with target audiences and carve out a distinct market position.
To validate their concepts and ensure a successful product launch, Apple employs various strategies, such as concept testing and focus groups. Instead, Apple makes final design and configuration decisions based on the demands of their potential customers. This iterative development cycle ensured that the final product aligned with Apple’s commitment to product innovation and exceeded customer expectations.
Throughout the development process, typically, Apple collaborates with the technology partner to help them enter new categories by leveraging the manufacturing partner’s technology skill base, distributors, partners, and sales team to optimize market reach and maximize sales potential. Apple has international launches with the same messaging and has created global campaigns to connect with consumers worldwide. This approach enabled Apple to maintain a competitive advantage and capture the attention of potential customers.
Furthermore, Apple uses its top executives and carefully choreographs product launch announcements to excite its customer base and show and explain its vision to them. Apple recognizes the power of social media in amplifying its marketing efforts. This strategy is also used with social media and is integrated into their overall marketing plan, enabling Apple to create a strong brand presence and enhance customer loyalty.
Technical innovation plays a crucial role in Apple’s product development process. With a strong focus on the complete solution, including the hardware and software development they sell and support, and integrated with partners to create a robust ecosystem, Apple ensured that its products were seamlessly integrated into its ecosystem, providing a cohesive user experience. By prioritizing technical feasibility to support their product innovation, Apple tends to develop timelines that can be predictable. Often, Apple sets new standards for connectivity, such as the lightning connector and the thunderbolt video, driving performance across the industry.
As entrepreneurs and businesses navigate the product development landscape, Apple’s product roadmap is a valuable guide to show how their configurations and products fit in the overall product line so that Apple has a good product family, i.e., iMac vs. iMac studio, MacBook Air vs. MacBook Pro, etc. Apple becomes a beneficiary of its success because it has a tremendous global distribution footprint, allowing it to connect with consumers anywhere. By leveraging its competitive advantages through retail and some of the new services it’s developing, like Apple TV and Apple Music, engaging potential customers, Apple established itself as a broad, innovative thinker that pushes the dimensions of its product categories in the new service and accessory options like App Store. Therefore, they not only sell devices but also profit from the apps. Through a relentless commitment to product innovation and a comprehensive understanding of its target market, Apple continues to captivate consumers and shape the future of technology.