Lead Times and the Development Risks

At one extreme of this correlation, the risks in the development of a product and also the cost of any delay in the lead-time for its introduction to the company are both low. This is a state of happiness for all concerned and occurs very rarely. For this to 

2-6 Development Manufacture B-C Break Even after Launch 

If the cost of delay in lead-time is low it is usually because the product has a long lifetime once in the market the customer once committed to the product will stay with it for a long time. If this is coupled with a high product risk, i.e. the product is expensive and needs a guaranteed customer, then a particular situation arises where it is best developed sequentially, as part of a series. An example outside the chemical field would be a range of aircraft such as the Boeing 747, 757, 767 series. 

Speeding up the delivery of new products to the market involves intelligent risk and resource management. 

A Manager can then use these very broad targets in discussions with staff in their work groups. In this way their project and its objectives can be seen to fit in with the overall strategy of the company. The key element of the Manager s role is to ensure that the right environment exists for time compression in product development to be achieved. 

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