How long does product development take?
11 February, 2015
Ask this question around the wealth and asset management industry, and you’ll find common answers include “forever” and “too bloody long”.
Product development usually takes longer than most people expect. But it’s typically not a case of “how long is a piece of string”. There are solid benchmarks for different types of product developments, and today’s graphic provides some guidance to setting reasonable expectations.
Benchmark duration means the time elapsed between initial concept statement and delivery / launch. The estimates assume that the firm is able to operate the product on existing systems and that no significant technology build is required…if that’s not the case, the sky’s the limit.
As horrifying as these durations sound, it could be much worse. Consider new product development in healthcare. The typical new drug takes 9-12 years to develop, if it ever gets to market.
In the many years’ experience of the Tria implementation team, these are reliable benchmarks. There are good reasons why it takes longer than many expect:
- Product development projects live and die on stakeholder engagement and management, and that takes time to do well.
- Product development is a very high risk activity (ie risk of failing to deliver on time / budget / specification, plus the risk of not earning a commercial return on the development investment) which needs to be managed via a phased stage-gate approach.
- Organisations have multiple priorities and people are busy – members of a product development team usually have BAU as well.
- We work in a highly regulated industry where organisations, directors, and trustees carry considerable liability for defective products – prudence generally demands a cautious and lengthy approval process.
All these requirements are included in the benchmark timeframes. Yet all too often, we know or hear of product developments dragging into a second year of frustrated stakeholders and melting down project teams. What goes wrong?
While there are many reasons a product development fails to come in on time (or sometimes ever), there are some consistent themes. These are generally due to a lack of experience or understanding within an organization or team in how to run a product development project.
And often you can’t blame the team. These are not skills you’re born with; they come from specific training and education. Yet many organisations throw their people into development teams without such support – and then wonder why they struggle.
Here’s our big three failure factors:
- Lack of stakeholder management – the team fails to identify all the parties it needs on board the bus to make a development a success, and / or it fails to keep them on the bus. This is not easy and can be like herding cats. You’ve got to get about 27 people on the bus, from operations to the board, and keep them there.
- Process failure – the team doesn’t have a robust development process or misses important steps. There is in fact a formula for development success. Development disasters most often occur when the scope wasn’t completed properly (or sometimes at all). The scope is a control document outlining the boundaries of the project, and defines all the key issues, sub-projects, and deliverables. It’s your map. Without it, you’re hurtling into the unknown – usually towards a cliff.
- Under-estimation / over-confidence – the team underestimates how complex, time-consuming, or expensive a development is going to be. While this may also be a result of a process failure, it can often reflect a lack of recent development experience. That’s not surprising in itself – many years may pass between major developments within an organisation, and in that time knowledge dissipates. Product development is a learning curve activity. The first after a long hiatus is often under-estimated; as a team gains development experience, they bring the organization down the learning curve and developments become faster and more efficient.
In a rapidly changing industry, product development skills are increasingly important for organization success. But it’s also about the people. Product is one of the toughest briefs in an organisation, requiring the people to master many competencies – not just the one or two needed by most other functions. It’s both a demanding and rewarding activity for people when it goes well. Equally, there are few more miserable places than a failing development team. You owe it to them to set them up for success.