PDMA SUCCESS MEASUREMENT PROJECT - RECOMMENDED MEASURES FOR PRODUCT DEVELOPMENT SUCCESS AND FAILURE

Success is not just elusive; it is also multifaceted and difficult to measure. A firm can assess the success or failure of a development pro ject in any (or all) of many terms, including customer satisfaction, f inancial return, and technical advantage. To complicate matters, succe ss may be measured not only at the level of the individual project, bu t also at the program level. With so many variables to consider and so many stakeholders involved, managers face a difficult challenge just deciding which measures are useful for measuring product development s uccess. Recognizing that no single measure suffices for gauging the su ccess of every product development project, Abbie Griffin and Albert L . Page hypothesize that the most appropriate set of measures for asses sing project-level success depends on the project strategy. For exampl e, the objectives (and thus, the success criteria) for a new product t hat creates an entirely new market will differ from those of a project that extends an existing product line. Similarly, they hypothesize th at the appropriate measures of a product development program's overall success depend on the firn's innovation strategy. For example, a firm that values being first to market will measure success in different t erms from those used by a firm that focuses on maintaining a secure ma rket niche. To test these hypotheses, product development professional s were presented with six project strategy scenarios and four business strategy scenarios. For each project strategy scenario, participants were asked to select the four most useful measures of project success. For each business strategy scenario, participants were asked to choos e the set of four measures that would provide the most useful overall assessment of product development success. The responses strongly supp ort the idea that the most appropriate measures of project-level and p rogram-level success depend on the firm's project strategy and busines s strategy, respectively. For example, customer satisfaction and custo mer acceptance were among the most useful customer-based measures of s uccess for several project strategies, but market share was cited as t he most useful customer-based measure for projects involving new-to-th e-company products or line extensions. At the program level, firms wit h a business strategy that places little emphasis on innovation need t o focus on measuring the efficiency of their product development progr am, while innovative firms need to assess the program's contribution t o company growth.