A Tekcess International client had been developing a new piece of process equipment for the semiconductor industry. The technology was novel and had generated a lot of “tire kicking” from prospects. However, after several years of product development and dozens of customer demonstrations, not a single dollar of revenue had been generated.
The management team was split on what to do with this product. Its advocates felt that a breakthrough was just around the corner, but its detractors were tired of investing without a return. Internal debates, although passionate on both sides, weren’t going anywhere because they didn’t have a solid framework for making the right decision.
To resolve the dilemma, we decided to follow a rigorous MRD process. The idea of going back and developing an MRD for an existing product development program may seem strange, but in this case, it was necessary to reach a consensus decision on the fate of this program. Should we do it? Or should we kill it?
We revisited the entire business case, which revealed that the market opportunity was much smaller than originally thought. Additionally, the product that was needed to capture any meaningful value would require substantially more time and money in order to bring it to market.
At the end of the process, it was decided that the program should be canceled. Once the organization worked through a logical framework for selecting products, it became clear that a business case for continuing this product did not exist. At first, the product manager felt like he had failed the organization. However, the opposite was true. He had just saved the company millions of dollars a year that could now be allocated to high-return programs.