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Description of the process
The Stage-Gate process begins with the identification and documentation of a new product idea. Tasks associated with the development of the product are then divided into a sequence of logical steps called Stages, each of which are preceded by a Gate where the attractiveness of the project is assessed. During each Stage, a cross-functional project team carries out tasks that result in the completion of previously defined deliverables. These deliverables are then presented in the form of a business plan to a Gate Review Board at a Gate Review meeting. No Gate Review meeting is held unless all previously agreed upon deliverables are met. To assure the appropriate amount of attention is paid to each functional area, Gate Review Boards are typically led by the head of the business unit for which the product is intended and staffed by technical (manufacturing, R&D, quality, regulatory) and business (sales, marketing, business development) functional group heads.
The focal point of the Gate Review meeting is a fact and logic based Go/No Go decision to determine whether the project merits the investment required to complete all tasks associated with the next Stage. No projects are allowed to proceed on the basis of “gut feelings”, nor are they allowed to proceed if the information needed to make an appropriate Go/No Go decision is lacking. Rather, prior to proceeding on to the next Stage, the project team is tasked by The Gate Review Board to obtain whatever information is needed to assure the four elements of risk are at acceptably low levels.
While the number of Stages and Gates used varies from company to company, five are the most common. Some companies (e.g., Hewlett Packard) use as many as seven.
Gate review
The aims of a Gate review are to find an agreement between the project leader and the gatekeepers on the deliverables and also to make a review of the gate criteria.
A set of Killer variables are designed for each gate. If these aren’t met during the gate review, the project will not pass the gate and a decision on how to continue has to be made. A stage can therefore include criteria that were not fulfilled in the prior Gate review.
When a gate has passed deliverables based on the set criteria, the next Gate is decided.
The criteria used in the gate review involve aspects such as:
- strategic fit
- market attractiveness,
- competitive advantage
- patent/legal issues
- technical feasibility
- regulatory aspect of health, safety and environment
- supply and market entrance
- financial attractiveness
Advantages of using the Stage Gate Process:
- Improved customer satisfaction
- Shorter time to market
- Improved new product success rates
- Improved new product launches
- Earlier detection of failures
- Increased R&D productivity
- Less recycling and rework