4.1.2 Project Management
The Low Tech segment circles move on the Perceptual Map at a speed of 0.7 units per year. The High Tech segment circles move at 1.0 units per year. You must plan to move your products (or retire them) as the simulation progresses. Generally, the longer the move on the Perceptual Map, the longer it takes the R&D Department to complete the project.
Project lengths can be as short as three months or as long as three years. Project lengths will increase when the company puts two or more products into R&D at the same time. When this happens each R&D project takes longer. Assembly line automation levels also affect project lengths. R&D project costs are driven by the amount of time they take to complete. A six-month project costs $500,000; a one-year project costs $1,000,000.
Sensors will continue to produce and sell at the old performance, size and MTBF specifications up until the day the project completes, shown on the spreadsheet as the revision date. Unsold units built prior to the revision date are reworked free of charge to match the new specifications.
If the project length takes more than a year, the revision date will be reported in the next Foundation FastTrack. However, the new performance, size and MTBF will not appear; old product attributes are reported prior to project completion.
When products are created or moved close to existing products, R&D completion times diminish. This is because your R&D Department can take advantage of existing technology. If the module is active, TQM/Sustainability investments can also decrease R&D times (see “7.1 TQM/Sustainability”). It is important to verify completion dates after all decisions have been entered. Usually you want repositioning projects to finish in less than a year. For example, consider breaking an 18-month project into two separate projects, with the first stage ending just before the end of the current year and the second ending halfway through the following year.
4.1.3 A Sensor’s Age
It is possible for a product to go from an age of 4 years to 2 years. How can that be? When a product is moved on the Perceptual Map, customers perceive the repositioned product as newer and improved, but not brand new. As a compromise, customers cut the age in half. If the product’s age is 4 years, on the day it is repositioned, its age becomes 2 years. Therefore, you can manage the age of a product by repositioning the product. It does not matter how far the product moves. Aging commences from the revision date.
Changing MTBF alone will not affect a product’s age.
Age criteria vary from segment to segment. For example, if a segment prefers an age of 2 years and the product’s age approaches 3 years, customers will lose interest (see Figure 3.4). Repositioning the product drops the age from 3 to 1.5 years, and customers will become interested again.