Tag Archives: Marketing

VOC Input for Product Requirements Development

VOC Input for Product Requirements Development

High Level Product Requirement Creation for New Medical Devices

Minimum Viable Products (MVP) in the Medical Device Market, take II

Goals and Objectives in Product Portfolio Planning for the Medical Device Market

Market Risk Identification in Product Portfolio Planning for the Medical Device Market

What Potential Acquirers Want Today in the Medical Device Market

Portfolio Planning in the Medical Device Market

Minimum Viable Products in the Medical Device Market

Medical Device Marketing Insights

Tag Archives: Marketing

New Product Launch Planning Topics for the Medical Device Market

VOC Input for Product Requirements Development

VOC Input for Product Requirements Development

High Level Product Requirement Creation for New Medical Devices

Minimum Viable Products (MVP) in the Medical Device Market, take II

Goals and Objectives in Product Portfolio Planning for the Medical Device Market

Market Risk Identification in Product Portfolio Planning for the Medical Device Market

What Potential Acquirers Want Today in the Medical Device Market

Portfolio Planning in the Medical Device Market

Minimum Viable Products in the Medical Device Market

The Set Up

The High Level Process

The Set Up

The High Level Process

30 Years of Lessons Learned

The Set Up

Over the years I have been privileged to launch or direct the launch of nearly 100 medical devices. With that experience I have learned that launching a new product is not a marketing function. It takes an integrated team with an integrated mind set. I have assisted a number of clients in designing their new product launch plans. Several long-time colleagues have recently asked me to provide a thought check-list for their less experienced team members to aid in launch planning.

So I have decided to share that check-list with everyone. I caution that this is a list of decisions or thinking that should occur as you are designing your launch. Following this check-list doesn’t gaurentee success. So much of the success comes from the quality and deepth of thinking you put into the topics. So with that cautionary note here is the check-list. A conceptual thought that might make this clear to you is to think about the topics as section title slides for the Launch deck.

The Intent with an Integrated Launch

The way I have always thought about a product launch is parallel to a rocket launch. Planned well (correct trajectory to achieve the proper orbit) you apply a tremendous amount energy (time, resources, targeting) to a launch and once you break free of Earth’s gravity (market resistance to change) you fly along at a speed of 17,500 miles per hour with no fuel being utilized at all.

The Thought Check-list

 Launch Summary

 Product vision

 Elevator pitch regarding the launch, not the product

 Market Understanding

 Therapy understanding

 Technology understanding

 Macro segmentation

 Competition defined

 Market drivers determined

 Key success factors identified

 Product Understanding

 Product definition

 Product description

 Positioning statement

 Value proposition

 Health-economic story

 FAQ

 Trouble shooting guide

 Allowed claims

 Competitive comparison

 Portfolio revelance

 Launch Strategy

 Launch goals/objectives

 Financial

 Revenue

 Profit

 Share shifting rate

 Non-Financial

 Quality

 Complaint

 Close success rate

 Compliance to targeting

 Business process metrics

 VOC

 Customer satisfaction product

 Customer satisfaction service

 Customer targeting

 Channel considerations

 Customer profile

 Customer engagement strategy

 External communication strategy

 Launch Tactics

 Launch structure (Controlled, Limited, General)

 Launch campaign development

 Team membership

 Launch calendar

 Sales process (Controlled, Limited, General)

 Product sampling plan

 Evaluation process steps identified and facilitated

 Pricing (Controlled, Limited, General)

 Reimbursement

 Demand generation plan

 Sales pipeline projections (1-12 months)

 Demand/Supply plan

 Revenue projections

 Share penetration rates

 Service plan

 Sales training progression plan

 Messaging Mix Development

 Message development

 Collateral development plan

 Video

 In-service video

 Promotional video

 Testimonial video

 Digital

 Print

 Promotion

 Trade show plan / calendar / collateral

 Poster and Potium plan

 Advertising plan / calendar / collateral

 PR plan / collateral

 Social Media Use plan

 Launch Controls

 Team dashboard

 Mgt. dashboard

 Quality dashboard

 Sales detail dashboard

 Product Claims

 Current claims

 Desired claims

 Gap analysis

 Clinical evidence collection plan

 Regulatory strategy

 Multi-generational Product Portfolio Plan

 Launch budget / spending plan by quarter over 12 months

Guidance

Not every launch will require all the check boxes to be checked. However, I strongly recommed that you think through the inclusion and exclusion of content from the list, defend the “in” and “out” decisions.

The higher the complexity of the technology / product / launch process the more likely it will be that you need to address each and every thought.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Tim Walker is the Principal consultant for The Experia Group. A small consulting firm that specializes in providing experience and expertise during critical device commercialization phases to increase the probability of success. www.theexperiagroup.com. Contact The Experia Group for a free 30-minute consultation to determine if 30-years of experience can contribute to your success.

Uncategorized

June 19, 2017 timwalker317526

The Set Up

Regardless of how you package or communicate the Product Requirements for a new product there must be a customer input process that precedes finalizing of those requirements. Collecting the Voice Of Customer (VOC) is critical to the success of new product creation.

The Double Diamond Process™

Sometimes a picture is worth 10,000 words. The chart shown to the right is the way I explain the approach to building that VOC into a fully validated set of requirements.

The key in the progression of confidence as you move down the double diamond. As you move through each section you gain the understanding and confidence in the data to which you need to apply your insight to.

Caution

If you want to assure the greatest chance of success don’t skip a step or stop early.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

March 10, 2017 timwalker317526

The Set Up

The Double Diamond™ Process

Sometimes a picture is worth 10,000 words. The chart shown to the right is the way I explain the approach to building that VOC into a fully validated set of requirements.

Caution

If you want to assure the greatest chance of success don’t skip a step or stop early.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

February 16, 2017 timwalker317526

After the series of blog posts relating to portfolio planning it only make sense to take the next step. New Product Requirement planning. This will be a tough series to write. So once again the goal will be to provide an awareness of the process and provide a couple of tips regarding “How To”.

If you gain nothing more than one “aha” out of this series then it was well worth reading.

There are three or four approaches to requirements planning. All of them can work. The process I layout for you here is a straight forward practical approach.

The big caution is reflected in the adjacent cartoon. To avoid the mis-communication take your time creating the Vision statement, Business problem statement, Clinician problem statement and ultimately the initial Product positioning and Value proposition statements.

Recognize a New Product Opportunity

From the portfolio planning process we have identified that we are vulnerable to collateral share loss in one specific area of our portfolio. Our market scan produced the realization that we don’t have a product in a fast growth segment of the market, perhaps more importantly three of our key competitors do.

Write the Business Problem Statement(s)

Write the problem statement(s) using general language. Note that you may have two or more problem statements. That’s cool. You could write it as a business problem, a portfolio problem, and /or a risk problem. A good start. Eventually you need to write it as a customer problem. Capturing the un-resolved issues that the fast growing segment is resolving.

Conduct a Qualitative Market Scan

Before you write the solution hypothesis you need to gather additional input from the market. At this point in the process I would urge you to collect structured well document qualitative data; don’t skip forward to conducting statistically valid market research just yet. I have spent as little as $25,000 and as much as $1.4 million on market research to determine a winning product definition. It is too big of a financial investment to dive right in without a little background work first.

Now is the time for a little sleuthing, search the MAUDE data base for complaint histories on all three competitive products. Categorize the complaints by type. I typically will capture the categorized data in an excel table. Obtain product specification for each of the three products (sale literature, IFUs from the website, 510k applications, general web search). Next, interview a couple of your top territory managers who have reported competitive activity in their hospitals. Have your sales force poll their accounts to determine who is using this new products. Identify which of your friendly accounts have committed to purchasing the new product (try to interview at least one representative account for each of the three competitive products). Arrange personal one-on-one interviews with each of these committed friendly accounts. The typical product marketing questions should suffice at this point:

What is/are the challenge(s) you are/were trying to overcome by using this new product?
How did you try to meet these challenges before you had the new device?
Why do you believe that this type of product will meet your needs?
What do you like about the product?
What don’t you like about the product?
What type of proof and metrics would you need to see to believe that the product will meet your needs?
What are important features or attributes of this type of product? (try to get this input prioritized, at least ranked and rated)
If there was one aspect of the product you could improve what would it be?

Write the Clinical Problem Statement

At this stage the problem statement can be several pages long. In general, the contents of a good problem statement should include:

A re-statement of the original problem statement that the competitive products were design for,
The residual un-met needs for each of the three product solutions (gap assessment),
A summary of the MAUDE database review,
A summary of claims made in the regulatory filings,
A summary of warnings and cautions from the IFUs,
A summary of the clinical trial data if any were required,
A summary of any editorials or press announcements regarding the products,
Competitive metrics: share, growth rate, revenue, ASP, archetypal description of customers

Caution: don’t become so focused on the gaps or potential solutions for the gaps that you forget to use fresh eyes on the original problem.

The discovery process that has been described can be done in as little as a couple of weeks or it could take a few months. The creativity comes from you as to how you do the work economically or efficiently. Just don’t skip this step.

Now you have enough information to define the problem. This will be the vision statement for your R&D team as well as management. A problem statement post will also be a part of this series.

Quantitative Market Research

Hopefully, your vision statement / problem statement has been compelling enough to warrant a further investment by Sr. management to execute a formal VOC process that will include additional qualitative and your initial quantitative research.

I will go into great detail is a subsequent post regarding how to do the quantitative research. For now lets focus on the output. For me the most effective way to look at the output of the initial quantitative research is in a stacked spider /radar chart. A spider/radar chart produces a geometric picture of the shape of possible solution sets for the un-met needs.

Description of a Radar/Spider Chart

Each of the axis of a radar chart represents a benefit/feature/attribute of the solution set. These are the most critical aspects of the product to the customer.The scores are a reflection of how well the product meets their needs. The scale is arbitrary, I typically will use 0-10. The end product in this scenario would have five (5) separate geometric plots.

The ideal or perfect scores for the general market
The ideal or perfect set of scores for your chosen segment
Competitor 1 scores
Competitor 2 scores
Competitor 3 scores

In the example provided you can see that the two series of data have markedly different shapes. The ideal solution for this general population would be the connecting of all the highest scores of each axis. This would provide you with a third geometric shape. By looking at the differences between the first two series and the newly created third one you get a feeling for the gaps. You can plainly see that the red series has a biased solution that delivers on the left axis and the blue to the right. Knowing this and combining it with the balance of what you learned from your competitive analysis you can determine what your new product strategy could be. There will be several biases that you can select from.

The big watch out here is to use the qualitative research to make sure your axis are the critical ones for success of your new solution. Your ultimately success with this new product will be directly linked to how well you determine the critical success factors or axis to plot.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

October 18, 2016 timwalker317526

The Set Up

I recently attend the VIVA2016 conference held in Las Vegas. I ran into a number of marketing wizard there. Several of them challenged my opposition to using the MVP product strategy for medical devices.

So I will be breaking into the chain of Portfolio development topics and take this post to re-frame some of the points that I made regarding MVP.

Clarification

Let me be clear, I am not opposed to the use of the MVP concept. It can be very valuable. My concern is in how it is used by those who are not well schooled in the device word. I have found with many inventor / entrepreneurs (brilliant people all of them) that they latch on to these concepts at a superficial level and could be setting themselves up for failure or worst yet, hurting people.

What is Meant by MVP?

When Eric Ries used the term for the first time he defined it this way: “A Minimum Viable Product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” Nowhere in this definition does he mention commercial viability. For the device world this may well be represented by a clinical trial.

The Caution?

We have to be careful when extending management (marketing) concepts across markets and industries. While there is a huge opportunity to learn from concepts formulated in other markets, sectors, industries and disciplines we can’t assume that they can be directly applied. We have to be good Marketers and review all the assumptions and environmental consideration and then apply them in our context.

We have seen where the application of Software or App development thinking has failed in the medical device space. How one manages the risk of failure is very different when the result is death or serious injury vs. being disappointed. MineCraft, the now very popular video game was launched commercially after only 6 weeks of development and was barely functional. It was however a great application of MVP. It served as a proof of concept. It offered a complete game, just not a very finished one. The risk of failure in MineCraft did not include death or serious injury to a real human.

One example (not a perfect one) of this is Theranos. They produced an MVP that failed to offer complete clinical utility (clearly an over simplification, but illustrative none-the-less). We will leave the why to others. Great concept, great story, great funding but the product just didn’t offer a complete clinical solution to the problem.

But a great quote from the reporter that broke the story that appeared in Vanity Fair’s article on Theranos, …Carreyrou was simply emboldened. “It’s O.K. if you’ve got a smartphone app or a social network, and you go live with it before it’s ready; people aren’t going to die,” … “But with medicine, it’s different.”

The MVP Concept, modified for devices

In Medical Device Development (MDD), the V in MVP is huge and unyielding. In today’s world the term Viable is getting bigger. It could be expressed as:

V = ƒ(V,S,R,CCU,C,$)

V = viable

S = safe

R = regualtory cleared or approved

CCU = offers a complete clinical solution

C = the promise of Cost neutrality

$ = a pathway to reimbursement

What do I mean when I say “complete clinical utility (CCU).” Once you get to the clinic you need to offer “complete clinical utility”. You must completely (minimally) solve the clinical problem that you were attacking. If you don’t you have delivered no real value to the clinician. By all means leave the sprinkles and glaze off, but give them a whole doughnut.

What I do find helpful is the idea of “fast to failure” referring to prototyping, at all three levels: concept, feasibility, and design. These prototypes can be partial, abstract, bread boards through Verification testing samples, but they don’t get near a patient.

A Different Way to Think about MVP

Fully integrated multi-generational product planning. A documented, data driven, customer focused pathway to delivering 100% customer satisfaction in steps. This type of plan can span decades as with the Left Ventricular Assist Devices (LVAD). Or, it can take just a few years as with the SMART Stent.

Call it what you will, MVP, CCU, multi-generational planning, doesn’t matter. Whatever you do, make it safe.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

August 27, 2016 timwalker317526

The Set Up

This post is number three in a series of five or six posts related to Product Portfolio Planning (PPP). Once you have the market risks identified and scored [from the previous blog post] you must then set a revenue goal. This post will deal with revenue goal setting and R&D budget setting. These three elements make up the end game for your product portfolio plan. As a reminder the goal of the PPP is to hit target revenue, at target cost levels with risk that is harmonized with your risk tolerance profile.

PPP Goals

The source of these Product Portfolio Goals (PPG) should come from a strategic plan (SP) that matches the time frame of the Product Portfolio Plan. If there isn’t a SP, then the source of your goals needs to be the CEO, President or VP of Gobal Marketing.

For larger corporations there will most certainly be either a SP or a policy intention. Something to the effect that by 20XX, XX% of our revenue will be provided by products launched within the last 5 years. Not too difficult to get to a number.

Illustration

So lets say that your company launched their first product in 2000 and in it’s first year it produced $20 million in sales. You had a steady release of new products and achieved $500 million by 2005. You had nothing in the R&D pipeline and there were significant shifts occuring in the market with innovation, competition and consolidation. Your CEO announces at a staff meeting that you need a continous flow of new product introductions such that you achieve $750 million in profitable revenue by 2013.

You get back to your desk and do some quick calculations and produce this chart.

You realize that you need $250 million dollars of revenue output from this new PPP within the next 7 years. It takes between 2-5 years to commercialize a product.

In that same staff meeting the CEO indicated that he was willing to invest more than the industry average to achieve that goal. You know from a industry survey and quick review of the competitors Shareholder reports that, on average, companies invest 7-10% on R&D. Taking your CEO at his word it looks like you would have 12% of revenue to invest each year. As sales continue to grow the R&D budget would grow in real dollars as well.

You are feeling a little better now. You know the revenue goal, you know the typical turn time for product development (based on the performance of the nine products that you have launched so far).

But Which Investments?

Where do you place the $60M worth of R&D dollars to guarentee that you reach $750M in revenue? There are two approaches to determine this list of development projects. Top-down or Bottom-up. I suppose there is a third, which is a combination of the two.

For me, an evironmental scan of your market is in order. As a quick starting point a Monte Carlo approach to determine the risks and opportunities in the market (as described in the most recent post). If there is a recent strategic plan (SP) document you could start there to discover the growing segments and review the SWOT anaylisis. If there isn’t a SP, start from scratch.

In parrallel, you take a look at what is being worked on in R&D currently. You discover that there are currently 18 projects under development. It appears that in the absence of an agreed to PPP every pet project has emerged and been funded. This is natural and is exactly why you need a portfolio plan.

So you ask yourself how many projects should you have?

You do a bit more analyis of the current performance of your products and project that same level of performance forward and you see from your chart that you need around five. You feel that you have a good start but realize that you are going to need a group effort to actual develop the plan. You report out your findings to the CEO and are asked to share your finding with the general staff next week. You do. The CEO then announces that you are now in charge of developing the PPP and that everyone is expected to provide their full cooperation.

The following week you get your team together, R&D, NBD, Finance, Marketing and Operations. The big realization that comes out of the organizing meeting are three very fundamental issues. First, that the market has been shifting for a long time, very slowly and now that you stop to look at the impact of those changes they look huge. Secondly, that R&D does not have a standardized method for comparing projects. If you are going to make a decision about which current and future projects to fund, it is critical that you have a very consistent way for comparing them. Third, that none of the 18 projects are fully funded or are driving toward a commercialization date.

So NBD and marketing head off to get a handle on the market and the market trends. R&D, finance and Ops head off to develop a method to compare projects (investments). You have all agreed to comeback in two-weeks with a status report. Meantime you have one of your Product Directors working on the market Risk assessment.

Two weeks later you gather again and there is good progress. R&D, Finance and Ops have come up with a model that scores cost, time, head count, technical risk, and capability. What they have not yet factored in are revenue potential, profitability, market acceptance risk and commercialization costs.

R&D variables

Market variable

· Utility delivered to end user

· Development cost

· Time to regualtory clearance

· Head count requirements

· Technical capabilities

· Technical risk

· Un-met market need

· Revenue potential

· Profitabilty (price target)

· Market acceptance

· Commercialization costs

· Time to commercialize

Discount factor due to combined confidence of success

Marketing and NBD report back that they have priced out several market research projects that would provide all the information they need. The price and lead time seem reasonable for the need, however there is no allocated budget to cover the $2M dollars and the six-month time line seems too long for the sense of urgency the CEO has around this project.

You assign a second Product Director to work with R&D and Finance to round out the balance of the project assessment method. You and NDB develop a survey (discussion guide) and make appointments with ten key opinion leaders, luckly 8 are attending a conference over the week-end and you will be there. While at the conference you speak with a total of 20 physicians and have what you think is a pretty good handle on the market needs.

Your next meeting with the extended team is a half day working session. Everyone reports out their findings. You now have a method for comparing projects, you have a feel for the market trends, you have a risk map that was developed [which your CEO, and all geographic experts, internal experts and two external market expert have scored].

During the half-day session you develop a table that organizes all the relevant information.

Risk or Trend	Source	Importance / Size	Project	Outcome

This chart is critical. It will provide a narrative surrounding the “as is condition” of your portfolio. The format and style is less important that the content. For me I would use 11×17 paper in profile.

What should become obvious from this charting process is the list of projects that are ongoing in R&D that have no bearing on the market reality that you are dealing with. Also, where the large holes are that need to be filled.

The Next Steps

Envision projects that would fill the holes
Rescore the Market Risk Assessment based on these new projects
Re-score the projects using the consistent methodology
Rank the projects using 1) discounted revenue potential, 2) pay back period 3) positive impact to market risk reduction. You can also use NPV or IRR calculations.

Chart the Rankings by Project

Prioritize the list of projects by combined rankings and then pour the R&D budget over the top letting it drip down until it is gone.

Hint: Never partially fund a project. Dry pancakes are just not satisfying.

More about Product Portfolio Planning in future blog posts.

Make sure you are signed up to receive personal notifications for future post relating to this subject.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

August 16, 2016 timwalker317526 1 Comment

The Set Up

Recently I mentioned using a Monte Carlo approach to determining market risk that you should address with your Product Portfolio Plan (PPP). I thought I would take a minute to describe the approach. As a reminder this post deals with only one of three key dimensions of setting your goals for your Portfolio Plan. The PPP should maximize the impact that your new product investment has on your companies performance in the Market.

I developed a tool as a way of garnering agreement with senior management that we were trying to solve the right problem with our Portfolio Planning Process. So that when we started the Portfolio Planning process we had a revenue target, a resource allocation budget and a risk profile projected forward over the 5-8 year period of the Portfolio Plan. The three dimensional aspect of budget, revenue goals and risk profile will help focus your Product Portfolio Plan on the right targets. With out clear targets you can’t optimize the plan. Don’t underestimate the challenge of garnering agreement on the targets.

Einstein indicated that if he were given an hour to solve a problem he would spend the first 55 minutes making sure he understood the question. Using this methodology will make sure that you understand the question.

The tool is the application of the FMEA methodology into a Monte Carlo method for determining the current assessment of risk in your market, or product segment.

What is a Monte Carlo Approach?

In general, a Monte Carlo approach is used when you have insufficient data to make a definitive decision. But, you need to get started, so you are better off polling the true experts in a field and after their consideration of the issue or problem you accept their consensus recommendation or finding as fact. Validate and adjust your actions from that starting point. Long-term experience suggests that you will be 80% correct, at least this is how I think about it.

A Monte Carlo method is not taking a WAG with three of your buddies. The preferred approach would be to spend a bunch of money, do a ton of research and take several years to figure out your portfolio plan. For companies that are resource constrained or time restricted a Monte Carlo approach, as describe here, is a great first step.

When applying a Monte Carlo approach in determining market risk I have adopted the Failure Modes and Effects Analysis (FMEA) methodology that is used through out the industry in product design. Using a specific and well understood method will help in documenting the process and the findings.

So when applying this method to determine the consensus beliefs about market risks you follow the steps below:

Conducting the Modified FMEA Process

Step 1: Identify industry experts (internal and external to your company)

Step 2: Have them write down the issues that give them pause, cause worry or keep them up late at night, etc.

Issues should be as specific as possible. An example of an issue is: Competitor X will launch their version of your new product Z; x number of months before you.

Step 3: Compile the issues lists and combine where duplicates appear. If you get over a dozen you might want to think about re-writing them to combine a few into a boader category.

Step 4: Create a table that have the Issues listed, any description for clarification purposes and two blank columns titled Impact and Probability of occurance.

Step 5: Assign a 1-5 scale for Impact and a 1-5 scale for Probability of occurance. These scale definitions are critical and a bit tricky to develop.

Step 6: Have the same panel of experts score the issues with the two scales. Each issue is scored 1-5 for impact and 1-5 for probability.

Step 7: Compile the results. Distributions and means. With the issues that have bi-modal distributions you need to go back and have a discussions to ensure that the issues was well defined.

Step 8: Once you have one pair of numbers, impact and probability it is time to plot them on a chart that has impact on the y-axis and the probability of the x axis. Let say that you had 11 major issues identified by your panel of experts. The 11 issues would be plotted as shown below. Note this is an illustration only.

Step 9: This chart will give you your market risk profile. Anything clearly in the red needs to be addressed by some aspect of the Strategic plan and if appropriate the Product Portfolio Plan.

So the three issues that are plotted in the red box, 5 x 5 must be addressed, failure to do so would be catastrophic.

Step 10: Reflect each issue that is in the red, back into the portfolio planning process. This will produce a mitigation plan.

Step 11: Have your expert panel re-score the issues taking into account the mitigations (how you changed the plan or added to it). Plot the new scores. You now have a before and after market risk profile.

Step 12: Once you are satisfied with the new profile, rank the impact that each product program produced. You may have 5-12 product programs that are required to mitigate the risks. Each program could impact multiple risk factors. These impacts should be additive in your prioritization scoring.

Example: Let’s say the issue is an emerging trend toward minimally invasive surgery (MIS) [issue number 2] and you had no products in the pipeline that addressed this emerging trend, currently rated a 4,4 risk score. You added a new product development project to the plan that moved [2] to a 4,1 risk score you have reduced the aggregate risk of this issue by 12 (16-4) a reduction in risk by 12 points. Let say that issue 9 was a lack of product innovation with respect to market leadership. The vision for the MIS project also helped reduce that risk issue as well moving [9] producing a risk reduction of 12 points. When ranking the product dev projects the MIS project would receive 24 risk reduction points.

This ranking will provide one of the three key elements for prioritizing the Portfolio for funding. In the end you will use three ranking scales to rank make your investment decision.

When the portfolio plan is completed you need to make sure you have updated the Market risk profile to reflect the final map based on what was ultimately funded.

Seem complicated? It is at first, once you have done it then you will see the simplicity and logic in it. That is why you must be disciplined in this approach.

Caution: The first time you use this approach do not try to do it alone. There are multiple tricky aspects that might lead you down the wrong road. Call me for one on one coaching or to sign me up to consult you through it.

Make sure you are signed up to receive personal notifications for future post relating to this subject. Download the excel workbook at www.theexperiagroup.com to make your learning a bit easier.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

July 27, 2016 timwalker317526 1 Comment

The Set Up

Over the past two-years I have had the good fortune to work directly with five medical device start-ups. Through my mentoring volunteer work I have also spent time with seven other start-ups, mostly medical devices.

A key observation for me is that being an entrepreneur is a spiritual journey. It is a calling that you can’t hide from. It is also a journey that you can’t take alone. No matter how broad your background is in all the disciplines of commercializing medical devices you still can’t know it all.

Why? Because time marches on! The experience you may have gain in sales or R&D or mfg. will grow stale with time. The advice you may be getting could be dated. I want you to succeed, so here is what I think you need to realize.

What Has Changed?

From a start-ups perspective, in most cases, the days of bootstrapping a finished product are gone. The need for high energy, high impact launches, and the capital to execute them, all but exclude slow rolling the post-launch of a new product. Why high-energy, high-impact launches? It takes tremendous energy to break through the noise of the big players. Similar to the launch of a space rocket, it takes tremendous energy to break free of Earths gravity.

Take a look at the following chart to see how acquirers have changed their expectations of potential device acquisitions over the last six decades.

A simple story is not enough, a product is not enough. In the decade of the 2000’s potential acquirers want all the risk removed. They only want to have to apply money and their high-powered sales channel to scale success. This means that you have to be prepared to take the device all they way through to commercial success. Commercial success does not mean that a few pioneering physicians have made it work. It doesn’t mean that you completed your clinical trial. It simply means that you have a validated “equation” for successfully selling into the early majority, proof that you have leapt the chasm.

What are the components of the “equation”?

Strong messaging (connects on an emotional level)
Sales process that works (80% of the time)
Believable value proposition
Routine clinical success (utility is delivered w/o a lot of hoops or work-a-rounds)
Clinical and economic evidence packaged professionally
Satisfied customers who are re-ordering

What Hasn’t Changed?

Over the past six (6) decades almost every aspect of commercializing medical devices has changed. The aspects that have not changed are the core principals that I have referred to before.

Engage with you customer
Safety, safety, safety (no short-cuts)
Quality, quality, quality (no short-cuts)
Deliver complete utility with hard value
Make the regulatory bodies your friend
There is no single formulae for success, only guidelines

Take a-way

In today’s world of medical devices, entrepreneurs and inventors need to have a longer-term vision for their companies. The days where a patent, or regulatory clearance will trigger an exit are all but gone. Too often the big players have not realized their hopes for gains from an acquisition. Often because the “equation” wasn’t thoroughly validated in the real market.

The deeper you go into the commercialization process the more help you are going to need. You can’t do it alone. You need a team with skills that are current and relevant.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

July 8, 2016 timwalker317526 1 Comment

The Set Up

Ok, Ok I give up! A number of my colleagues have asked for a post relating to building a Product or Technology portfolio. I have been reluctant to write this post for a number of reasons. 1) every portfolio planning process needs to be customized to the company and the type of products under development, 2) portfolio planning is very complex, and 3) they need to be preceded by a Corporate Strategic Planning process.

I think the best that we can hope for from this blog is to identify some common elements of every portfolio plan, define what one is and provide some cautions to take into account as you develop your plan.

What is a Portfolio plan?

Essentially a product portfolio plan is one that identifies the New Product contribution to the long-term revenue forecast of the company as made by individual product development projects or acquisitions. Typically, you start with either a collection of opportunities that have already been identified, or a set of market conditions that the strategic plan wants to leverage. Add in a set of current performing products and a competitive threat matrix. Stir all this together and then go crazy.

My preference is to ignore everything that has been done to date and start from the output of the strategic plan and identify the areas for investment. Identify the current products that contribute in those areas, identify un-met customer needs from those areas and identify potential products to resolve those un-met needs, then build the plan from scratch.

The goals of the portfolio plan will be driven off of the Corporate strategic Plan. Profit, revenue growth, competitive action, leadership, share dominance, access, and discovery are all legitimate goals that can be derived from the strategic plan. In economic speak the Portfolio Plan should maximize the combined output, X_p; for the minimum investment, Y_p; at the lowest risk, ß_p.

In finance we often refer to a balanced portfolio as a goal. I tend to believe that instead of balance one should strive for harmony. Balance is a precise thing, harmony has some freedom around it. The ultimate Portfolio will hold many assumptions at multiple levels and we should strive to make it as accurate as possible, but it will never be precise.

No project or combination of products is/are without risk. All known risks can be managed. Managing risk takes time and money. Risk is a big concept in the medical device space. So lets be clear, the risk I am talking about is the chance that your total portfolio does not produce your desired outcome, does not meet the needs of the strategic plan and its inherent goals. Lets refer to that as ß_p There are other ways that the concept of risk sneaks into the portfolio plan. Most notably as a discount factor for the revenue generation of each opportunity that ultimately will be combined to produce the Portfolio Plan.

The Steps in Building a Portfolio Plan

For me:

Step 1 – Read and understand the strategic plan. (Pull out the explicit and implicit measurable goals from the plan)

Step 2 – Interview all the senior managers that were involved with creating the strategic plan to make sure you have a feel for each of their visions for the portfolio

Step 3 – Create a heat map of market and competitive risk, basically a FMEA assessment of your SWOT analysis that should come from the Strategic plan

Step 4 – Create a matrix of segments that the strategic plan identifies that you want to be in, enter or exit.

Step 5 – Survey the clinicans that are the key users or drivers of/in those segments

Step 6 – Identify the opportunities that exsist.

Step 7 – Have teams create an opportunity assessment for each opportunity.

Step 8 – Score each opportunity in terms of it contribution to the objective for that segment that was identified in the strategic plan.

Step 9 – Score each opportunity in how well they reduce risk identified from the heat map.

Step 10 – Score each opportunity by the cost of realizing that opportunity.

Step 11 – Either use a discount factor to fold in the risk of success or failure of the project ( Innovation, core competency, speed, timing, competitive development)

Step 12 – Using the four scores force rank the opportunities separately, so that you have a list that is ranked by score 1, score 2, score 3, score 4 Typically, the high impact / low cost ones will be at the top. Those at the bottom of all four scores are usually out. It is the middle ones that require some discussion.

Step 13 – Allocate the New Product budget to each of the opportunities and see how far down the list the money will go. Ask two questions if we execute this plan will we achieve the strategic intent of the company? Is our portfolio plan in harmony with our willingness to absorb risk?

Last step – Vet the plan with the bosses, dispassionately.

Cautions

The development of a portfolio plan is not an engineering exercise, it is a social-science experiment. An experiment with significant political implication.

Each opportunity must be assessed under a strict set of guidelines. Inconsistency in the approach and definitions will invalidate your portfolio plan.

Marketing can not do this process alone. It must be a team effort between R&D, NBD, Up-stream marketing, finance and operations.

Document in a very obvious manner all the assumptions that are used. Independently vet the assumptions to ensure that everyone is OK with the assumptions and confidence you have in your data. If they are not ok with the assumptions, stop and develop a plan to move the assumptions to facts.
It will be difficult, but don’t take it personally, any of it.

If your organization is not willing to allow the time and dollars to develop a great portfolio plan then you are better off getting the most informed opinions in a room and make the call without data, a modified Montecarlo process.

A portfolio plan needs to be reviewed constantly and changed seldom.

Why do I need a Portfolio Plan?

The life blood of the medical device market has been a continual stream of new products. In todays environment the commercialization process will require 2-5 years from start to finish. If you don’t have a well thought out plan you are already behind the time curve.

At many Med Dev companies the goal is launching a new product every year and a new platform every two-years. If you can accomplish this goal you are on your way to sustained growth, if they are the next right projects. A well thought out portfolio plan will drive your M&A activity as well as R&D. If you as a Marketing organization have effectively laid out where you need to go to accomplish your new product revenue goals, you put yourself in a leadership position and if done well you are moving your organization to be a market driven organization.

Final Thought

A well done product portfolio plan that is in harmony with the strategic plan gets the entire organization on the same page. Having the assumptions well understood and monitored will provide an early warning system if changes are required.

The last thing any organization needs is a whip saw effect in new product development.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

Uncategorized

June 22, 2016 timwalker317526 1 Comment

The Set Up

I was speaking with a prospective client recently. He wanted to know if I could help him define his MVP. MVP stood for Minimum Viable Product. A term he had picked-up at a lean start-up seminar. I told him that I could do that, if that was what he really thought he needed. I left him with a couple of questions and we agreed to meet again to discuss what it would take to define the MVP for him.

I asked him, “What was his objective of using the MVP style product devlopment process?” His answer was, “I can’t afford to solve the whole problem, this way I can get something out generate sales so I can afford to solve the rest of it.”

The second meeting took over an hour and as hard as I tried I couldn’t get him to stop calling it the MVP. It set me to thinking about the term and the product that would result. Initially, I thought that I was just getting hung up in the words, (as a personal note I am trying to eliminate my need to be right). So we laid out a plan to define the first of a multigenerational product development plan for his platform technology. He was delighted.

What is Meant by MVP?

When Eric Ries used the term for the first time he described it as: “A Minimum Viable Product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.”

My client had gotten the impression that the goal of an MVP was about generating early revenue. Early revenue is a by-product. Nowhere, does Mr. Ries bring money into the picture. Validated learning is the goal of the concept. In the MVP concept, validated learning implies a real life use experience.

The Caution

We have to be careful when extending management (marketing) concepts a cross markets and industries. While there is a huge opportunity to learn from concepts formulated in other markets, sectors, industries and disciplines we can’t assume that they can be directly applied. We have to be good Marketers and review all the assumptions and environmental consideration and then apply them in our context.

We have seen where the application of Software or App development thinking has failed in the medical device space. How one manages the risk of failure is very different when the result is death or serious injury vs. being disappointed. MineCraft, the now very popular video game was launched commercially after only six-weeks of development and was barely functional. It was however a great application of MVP. It served as a proof of concept.

The risk of failure in MineCraft did not include death or serious injury to a real human.

The Concept

In Medical Device Commercialization, launch MVP is not an appropriate approach, unless you redefine viable to have a really big meaning. For med device dev. we should think of “complete clinical utility” (CCU). We can use a modified concept of MVP to get us there. But if you do not deliver “complete clinical utility” at the time of launch you have delivered no real value to the clinician. By all means leave the sprinkles and glaze off, but give them a whole doughnut.

A Different Way to Think about MVP

Back to the Story

Call it what you will, MVP, CCU, multi-generational planning it doesn’t matter. The basics of product marketing need to be satisfied. Product requirements need to be written. Target the Complete Clinical Utility of the product first. Use the MVP concept during the concept phase.

“Experience is what you get, right after you need it most.”

Make it a great day,

Tim Walker

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