Stage-gate model

Definition

The stage-gate model is a project management tool that guides the development of new products through a series of stages and gates. Each stage represents a phase of the project where specific tasks are completed, and each gate serves as a decision point where the project's viability is assessed before moving on. This systematic approach helps organizations streamline their innovation processes and optimize resource allocation, ultimately impacting their return on innovation investment.

5 Must Know Facts For Your Next Test

1. The stage-gate model was developed by Dr. Robert G. Cooper in the 1980s and has since become a widely adopted framework for managing innovation projects.
2. Each stage in the model typically involves specific deliverables such as market research, technical feasibility studies, and prototype development.
3. Gates in the model serve as critical checkpoints where project teams present findings to decision-makers, who then evaluate whether to continue, pivot, or terminate the project.
4. The stage-gate model encourages cross-functional collaboration among different departments like marketing, R&D, and finance, enhancing overall project success.
5. Using this model helps organizations improve their return on innovation investment by allowing them to focus resources on the most promising projects while minimizing waste.

Review Questions

• How does the stage-gate model facilitate effective decision-making throughout the product development process?
  • The stage-gate model facilitates effective decision-making by establishing structured checkpoints known as gates. At each gate, decision-makers assess whether the project should proceed based on criteria such as feasibility, market potential, and alignment with strategic goals. This structured approach ensures that resources are allocated efficiently to projects with the highest potential for success, reducing risk and increasing the likelihood of positive outcomes.
• Discuss how the integration of risk assessment within the stage-gate model can enhance innovation management practices.
  • Integrating risk assessment within the stage-gate model enhances innovation management by providing a systematic way to identify and evaluate potential risks at each gate. This ensures that teams can make informed decisions about whether to continue or adjust their projects based on the risks involved. By proactively addressing risks, organizations can improve their chances of successful product launches and ultimately achieve better financial returns from their innovation investments.
• Evaluate how the adoption of the stage-gate model can impact an organization's overall strategy regarding innovation investment and resource allocation.
  • The adoption of the stage-gate model can significantly impact an organization's overall strategy by promoting a more disciplined approach to innovation investment and resource allocation. By using this framework, organizations can prioritize high-potential projects that align with their strategic objectives while systematically eliminating less promising initiatives. This leads to improved efficiency in resource use and a higher return on innovation investment, allowing companies to remain competitive in rapidly changing markets.

Related terms

Innovation funnel: A visual representation of the innovation process that illustrates how ideas are filtered and refined from many possibilities into a few viable projects.

Risk assessment: The process of identifying and evaluating potential risks associated with a project, which is crucial during the gate decisions in the stage-gate model.

Portfolio management: The centralized management of one or more project portfolios, ensuring alignment with strategic goals while balancing risk and return on investment.