The Lean Product

Development Benchmark
Report

May 2007
Lean Product Development
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Executive Summary
Lean concepts have helped manufacturers streamline processes and reduce Exmark Manufacturing Co. Inc.,
a division of The Toro
cycle times in complex manufacturing and supply chain environments. These
Company
concepts are now being applied to product development, resulting in
increased productivity and greater ability to develop profitable products. We have fostered a Lean
culture through “top down”
Best in Class Performance and “bottom up” corporate
lean objectives. We have
The top 20% of companies benchmarked – the Best in Class – enjoy a
robust new product
significant performance gap over their competitors in meeting targets for development (NPD) processes
product launch dates, product development costs, product cost, product that are documented and
revenue, and quality. They are hitting these targets that drive profitability on continuously evolve as we
over 80% of their products while average companies hit these targets less learn, enabling us to reduce
than 60% of the time. As a result, Best in Class performers enjoy 53% more non-value-added steps or
productive product development time per person than their average processes.
competitors, and bring products to market 25% faster on average.
Competitive Maturity Assessment Dave Converse, Director of
Engineering
Survey results show that Best in Class firms share an increased focus on
Lean Product Development. Specifically, Best in Class companies are 1.4
times more likely to have pursued Lean Product Development for more
than one year than average companies. These companies leverage current
best practices and PLM technologies and extend them with Lean capabilities
to improve product profitability.
Required Actions
In addition to the specific recommendations in Chapter 3 of this report, to
achieve Best in Class performance, manufacturers must:
• Streamline processes, including improving process flow and aligning
information with processes.
• Reduce wasted effort, including elimination of non-value added steps
and automating redundant tasks.
• Reduce variability, by standardizing work processes and deliverables
and reducing risk through the use of design sets.
• Validate designs early, co-develop and validate products to confirm
manufacturability and prevent design rework.
• Develop a Lean culture by enabling change at all levels and measuring
product development with metrics.

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Lean Product Development
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Table of Contents
Executive Summary....................................................................................................... 2
Best in Class Performance ......................................................................... 2
Competitive Maturity Assessment........................................................... 2
Required Actions ......................................................................................... 2
Chapter One: Benchmarking the Best in Class...................................................... 4
Lean Product Development: Aberdeen Analysis .................................. 4
Maturity Class Framework ........................................................................ 4
Key Measure of Lean: Percent of Value-Added Effort......................... 5
Best in Class PACE Model ......................................................................... 6
Key Measure of Product Development: Time to Market................... 7
Chapter Two: Benchmarking Requirements for Success .................................... 8
Competitive Assessment............................................................................ 8
Organizational Capabilities and Technology Enablers .......................10
Chapter Three: Required Actions .........................................................................13
Laggard Steps to Success..........................................................................13
Industry Average Steps to Success.........................................................13
Best in Class Steps to Success ................................................................14
Appendix A: Research Methodology.....................................................................16
Appendix B: Related Aberdeen Research............................................................19

Figures
Figure 1: Top Performers Hit Targets, Earn “Best in Class” Status ................. 5
Figure 2: Time Spent on Productive Development Activities ............................ 5
Figure 3: Lean Product Development for More than 1 Year ............................. 8

Tables
Table 1: Best in Class PACE Framework ................................................................ 6
Table 2: Product Development Leadtime – BIC Advantages ............................. 7
Table 3: Competitive Framework ............................................................................. 9
Table 4: PACE Framework .......................................................................................17
Table 5: Competitive Framework ...........................................................................17
Table 6: Relationship between PACE and Competitive Framework.............18

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Lean Product Development
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Chapter One:
Benchmarking the Best in Class
Lean Product Development: Aberdeen Analysis Fast Facts

Manufacturers have to bring products to market rapidly and efficiently to √ Best in Class
manufacturers hit product
realize the profit potential of their innovations. This complex process
launch dates 72% more
involves multiple departments and disciplines working together to develop a frequently than average
product that is right for the market – both technically and commercially. companies
Lean concepts, already used to streamline manufacturing operations and
the supply chain, are now being applied to product development in the √ Best in Class
manufacturers hit product
hopes of increasing product profitability.
development cost
targets57% more
Maturity Class Framework frequently than average
companies
Aberdeen used five performance criteria to measure companies’ product
development performance and to distinguish the Best in Class from Industry
Average and Laggards. These five metrics including meeting targets for:
• Product launch dates Boeing
• Product development costs “On the defense side of the business,
• Product costs we have put an umbrella on
• Product revenue improvement processes under Lean.
• Quality There has been a lot of effort on
streamlining processes and reducing
These are the metrics that drive product profitability. The top 20% of NVA (non value added) steps, along
companies benchmarked – the Best in Class – enjoy a significant with a big emphasis on education.”
performance gap over their competitors, hitting these targets on over
80% of their products as compared to average companies who hit most of
these targets less than 60% of the time (Figure 1). Clearly, there is a large Carolyn Castillo, Integrated
difference between the performance of the top twenty percent as compared Defense Systems
to average companies, giving the Best in Class companies a clear competitive
advantage over their competition. The metrics serve as a good measure of
the success of bringing profitable products to market, and are used in this
benchmark to measure the effectiveness of Lean initiatives in product
development.

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Lean Product Development
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Figure 1: Top Performers Hit Targets, Earn “Best in Class”

Status

100% 91%
86% 87%
90% 83% 83%
80% 72%
70%
59%
60% 56% 53%
50%
50%
37%
40% 32%
28%
30% 20% 18%
20%
10%
0%
Launch Date Revenue Product Cost Development Quality
Targets Targets Cost Targets Targets

Best in Class Average Laggard

Source: Aberdeen Group, May 2007

Key Measure of Lean: Percent of Value-Added Effort Top Priority “Waste” Identified by Best in
Another metric important to measuring Lean initiatives is the percentage of Class
effort spent on “value-added” activities. For example, time spent on projects √ Poor or missing requirements, or
with poor or missing requirements was identified by 47% of Best in Class requirements not aligned with
companies as one of the highest priority “waste” in product development. customer value
Another 44% identified waiting for information from others as non value - √ Waiting for information from
added. By proactively minimizing these “wastes”, Best in Class companies others
increase their product development productivity. In fact, Best in Class
√ Redeveloping redundant designs
performers have 53% more productive time per employee than
average companies. (versus reusing existing designs)

Figure 2: Time Spent on Productive Development Activities

80% 69%
70%
60%
50%
45%
40%
26%
30%
20%
10%
0%
Best in Class Average Laggard

Source: Aberdeen Group, May 2007

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 Lean Product Development
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Best in Class PACE Model

To better understand the reasons behind these performance gaps,
Aberdeen benchmarked the pressures that have led companies to pursue
Lean Product Development strategies, the actions that have helped them
“Lean out” their development process, and the underlying business
attributes that they have put in place in order to support their efforts. Using
Lean Product Development to achieve superior product development
performance requires a combination of strategic actions, organizational
capabilities and enabling technology (Table 1). See “Table 4, PACE
Framework in Appendix A for more detail on Aberdeen’s methodology for
benchmarking company initiatives such as Lean Product Development.

Table 1: Best in Class PACE Framework

Pressures Actions Capabilities Enablers

• Global Markets / • Improved Product • Product Development • Advanced Search Technologies

Competition Development using “Design Sets"
• Knowledge Based Engineering
Processes
• Market Demand • Information Flow Aligned (KBE)
for Rapid Product • Reduced “Waste” in with Process Flow
• Digital Manufacturing (DM) /
Introduction Product Development
• Lean Change / Process Manufacturing Process
• Limited Product • Manufacturing Improvement Enabled at Planning
Development involvement in All Organization Levels
• Specialty Tools for Lean
Budgets Product Development
• Product Development
• Workflow / BPM
• Cost Reduction Effort Results Measured with
Early in Design Timely Metrics • Product Portfolio Management
(PPM) - Including Project
• Value Stream Mapping
Management
• Standardized Work
• Automated 2D/3D Publishing
Methods
• Product Cost Management
• Concurrent Design
(Integrated Product / • Value Stream Mapping
Process Design)
• Product Data Management
(PDM)

Source: Aberdeen Group, May 2007

,
r

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Lean Product Development
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Key Measure of Product Development: Time to Market Fast Facts

One of the most important metrics to measure product development
√ Best in Class performers have
success is the time it takes to introduce a new product to market. 53% more productive product
Aberdeen’s Product Portfolio Management benchmark shows that products development time per employee
less then two years old enjoy a significant margin advantage. Best in Class than average companies
companies are taking advantage of their increased efficiency, bringing
√ Best in Class manufacturers
products to market an average of 25% faster than their
bringing products to market an
competition (Table 2). average of 25% faster than their
competition
Table 2: Product Development Leadtime – BIC Advantages
Best in
Class
Product Development Benchmark Advantage
Minor revision to an existing product 14%
Major revision to an existing product 31%
New product, similar to existing products (or in existing
product platform) 25%

Entirely new product (or new product platform) 31%

Average product development advantage 25%

Source: Aberdeen Group, May 2007

Aberdeen Insights – Strategy

Product development teams have come under intense pressure to do more with less.
Driving revenue demands product innovation and rapid new product introduction.
Global markets and global competition, however, have driven down sales margins.
So designers must not only innovate on product performance, but also on ways to
reduce the cost structure of the product. This dual requirement of rapid product
innovation within cost constraints extends beyond product cost as well, with
companies faced with tight product development budgets and limited resources. To
succeed in this environment, companies are looking for lessons learned in other parts
of their organizations in the hopes of improving product development – resulting in
the application of Lean concepts to product design and development.
Lean concepts learned from manufacturing and supply chain initiatives are proving
valuable in product development. Some of the core principals of Lean include
streamlining processes and reducing non-value added effort known as “waste”
through processes such as value stream mapping. In addition to traditional Lean
approaches, there are also emerging Lean strategies that are specific to product
development such as the use of “design sets” to reduce risk and variability.

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Lean Product Development
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Chapter Two:
Benchmarking Requirements for Success
Lean Product Development is not a technology. It is a product development
philosophy that encompasses a number of core disciplines. Before Fast Facts
investigating the components of Lean, it is important to establish whether √ Best in Class companies are more
Best in Class companies owe their superior performance – at least in part – than two times as likely to have
to the use of Lean concepts. To this end, over 25%of Best in Class pursued Lean Product Development
companies indicated that they have had a Lean Product for more than 1 year.
Development program in place for five or more years compared √ Twenty-five percent (25%) of Best in
to less than 5% of average companies. In fact, Best in Class companies Class have had a Lean Program in place
are more than two times as likely as average companies to have had a Lean for more than 5 years versus 5% of all
Product Development program in place for more than one year (Figure 3). others.

Figure 3: Lean Product Development for More than 1 Year

Wells Manufacturing L.P.

70% 65% “We have established Lean practices as

regular part of development process. Our
60%
design reviews include Kaizen study of
50% assembly and test. We have a team
40% development and review process
27% 24% incorporating all disciplines, and we are
30%
value stream mapping our processes.”
20%
10% Glen Eichhorn,
0% Vice President Electronics
Best in Class Average Laggard

Source: Aberdeen Group, May 2007

Competitive Assessment
To analyze the Lean approaches that lead to enhanced performance, survey
respondents were classified into one of three categories – laggard, industry
average, or Best in Class — based on their performance. Then,
characteristics in five key aspects of their business: (1) business process; (2)
organization; (3) knowledge management; (4) use of enabling technology;
and (5) performance management were analyzed. The results of this analysis
were compared to average and laggard performers, and the most
differentiated approaches are highlighted below as a means to understand
what leading companies are doing differently from the rest (Table 3). For
more information on Aberdeen’s Competitive Framework, see Table 5 in
Appendix A.

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 Lean Product Development
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Table 3: Competitive Framework

Best in Class Average Laggards
Product Development using “Design Sets":
Process 18%
50% 19%
Exmark Manufacturing Co. Inc.,
Value Stream Mapping: a division of The Toro
67% 39% 52% Company
“We have fostered a Lean
Standardized Work Methods:
culture through “top down”
88% 64% 54% and “bottom up” corporate
Lean objectives. We have
Concurrent Design (Integrated Product / Process Design): robust new product
77% 54% 48% development (NPD) processes
that are documented and
Lean Change / Process Improvement Enabled at All Organization Levels: continuously evolve as we
Organization learn, enabling us to reduce
70% 35% 35%
non-value-added steps or
Information Flow Aligned with Process Flow: processes.”
Knowledge
60% 29% 27% Dave Converse, Director of
Engineering
Centralized / Documented Engineering Knowledge:
63% 55% 45%
PLM related technology currently in use: Raytheon Company
Technology • 53% Advanced Search • 23% Advanced • 18% Advanced Search “One of the major wastes is
Technologies Search Technologies Technologies waste of knowledge. If the
• 62% Knowledge • 25% Knowledge • 27% Knowledge Based value that isn’t stored and
Based Engineering Based Engineering Engineering captured, or can’t be retrieved
• 53% Digital • 34% Digital • 16% Digital easily, the next person will have
Manufacturing Manufacturing Manufacturing to waste time in finding or
• 61% Specialty Tools • 26% Specialty Tools • 43% Specialty Tools for recreating it.”
for Lean for Lean Lean Mark Edmondson
• 72% Product Portfolio • 51% Product • 30% Product Portfolio Director, Enterprise Lean
Management Portfolio Management
Strategy
Management
Product Development Results Measured with Timely Metrics:
Performance 73% 46% 41%
Source: Aberdeen Group, May 2007

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 Lean Product Development
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Organizational Capabilities and Technology Enablers

The benchmark is not intended to be a comprehensive overview of Lean or
even Lean Product Development. The items in the Competitive Framework
above, and detailed below, are instead the components of Lean that have Industrial Equipment Manufacturer
the largest impact on improving performance. To validate designs earlier, we have made
team design review, approval and review
• Product Development Using Design Sets – Developing products documentation part of standard work.
from designs sets that are functionally interchangeable enables
,
r innovation with minimal risk. These individual designs are developed as
functional “modules” with standardized interfaces that buffer the rest of
the product from dramatic changes. As a result, engineers can explore a
wide variety of new options in parallel without introducing risk to the
schedule of the project at large.
Aerospace and Defense Manufacturer
• Value Stream Mapping – The process of analyzing the steps of a
process in order to detect inefficiency, unnecessary actions, and wasted “We use value stream mapping to look for
effort. It is central the concept of a Lean enterprise. The activities that lessons learned and find ways to make
continuous improvements. Every time we
do not contribute to achieving customer value are redefined or
do a job we try to find ways to make the
removed, shortening the overall product development process. As a procedures for our custom projects more
result, the process is streamlined. scalable.”
• Standardized Work Methods – Standardization of processes and
deliverables. Primarily intended to increase efficiency, reduce variability,
and allow for continuous improvement.
• Concurrent Design – Executing design activities for related
components and manufacturing in parallel in order to shorten time to
market. In addition, concurrent design helps to prevent rework because
design decisions are not “locked in” before downstream processes and Industrial Manufacturing
related components are designed. “We model every part into the system
• Lean Change / Process Improvement Enabled at All in order to assure that the
manufacturing of the product is fully
Organization Levels – An organizational philosophy that advocates
accounted for, and we have developed
that people responsible for executing a process have the greatest insight concurrent product cost estimating
into how the process could be improved, and should be given the ability tools and methods. We use cross-
to experiment with new approaches to improve efficiency. functional teams to perform DFMA
• Information Flow Aligned with Process Flow – Ensuring that (design for manufacture and assembly)
activities at various phases of the design
alongside a Lean process, individuals at all steps of the process have the
stage, from sub-assembly level all the
right information to do their jobs without the waiting, excessive way to complete machine.”
searching, or rework of data. Aimed at reducing cycle time and
improving efficiency.
Dave Converse, Director of
Engineering

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Lean Product Development
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• Centralized / Documented Engineering Knowledge – A common

repository, whether logical or physical, that provides ready access to
accurate, current product data to promote efficiency and encourage
design reuse.
• Advanced Search Technologies – Technology that allows
components or designs to be accessed by different methods, including
search by parameters, part characteristics, metadata, or 3D information.
Reduces time wasted waiting for information from others or in
inefficient searches.
• Knowledge Based Engineering – The capture of engineering
knowledge and the use of design automation to standardize and
automate routine or complex engineering tasks. Used to promote
efficiency, reduce errors, and reduce variability.
• Digital Manufacturing – The use of simulation technologies and
manufacturing process planning solutions to design, validate, reuse, and
communicate manufacturing processes. To improve efficiency, enhance
manufacturability, and reduce design rework by eliminating errors prior
to releasing the design to manufacturing.
• Specialty Tools for Lean – Tools used to execute process
improvement, communicate standardized work processes, or support
Lean events. These tools are business approaches that have been
automated by many companies to promote consistent execution of
Lean activities.
• Product Portfolio Management – Solutions used to determine
which product development initiatives should be funded. Helps to target
product development on products and requirements aligned with
customer value.
• Product Development Results Measured with Timely Metrics –
The use of performance measurements to identify variability and
opportunities for improvement during execution, in order to correct in-
progress projects and continuously improve processes.

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Lean Product Development
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Aberdeen Insights – Capabilities

Lean Product Development is not a single thing, but a collection of approaches that
can help companies significantly improve product development performance. Some
of the approaches, such as product portfolio management, standardized work
methods, and performance measurement, are not unique to a Lean approach. They
are, in fact, established best practices for product development. The same can be
true for proven engineering approaches such as digital manufacturing, concurrent
design, and knowledge based engineering. Other techniques are tried and proven
concepts of Lean initiatives, such as value stream mapping and enabling change at
all levels of the organization. Finally some are new concepts that are being classified
into a new definition of Lean, which include designing using design sets.
In combination, these techniques are becoming the new standard for product
development. They encapsulate the current best practices in product development
and engineering, integrate them, and then extend them with Lean techniques. Best in
Class companies have embraced these processes, and are achieving significantly
better performance in product development as a result.

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Chapter Three:
Required Actions
Whether a company is trying to move its performance in product
development from “Laggard” to “Industry Average,” or “Industry Average”
to “Best in Class,” the following actions will help spur the necessary
performance improvements using Lean Product Development techniques: Fast Facts
Best in Class manufacturers are
Laggard Steps to Success adopting Lean Product Development
1. Streamline processes. Put in place cross-departmental product strategies faster than their peers.
development processes, and streamline them to reduce wait times and Leading companies have leveraged a
combination of current best practices
other waste.
in new product development, Lean
2. Reduce wasted effort. Identify and reduce all effort that does not principals from manufacturing, and
provide direct value to the customer (or is an unavoidable cost of doing new Lean concepts specific to Lean
business). Prevent time wasted in search by making information readily Product Development
available in a central location and providing advanced search capabilities.
3. Reduce variability. Reduce waste in the form of variability which
provides unpredictability and prevents continuous improvement by
standardizing work processes and deliverables.
4. Validate designs early. Ensure the designs are correct early in the
development process. Co-develop products to find problems earlier
when they can still be corrected or avoided by utilizing concurrent
design.
5. Develop a Lean culture. Teach employees the fundamentals of Lean
and begin to adopt Lean thinking. Incorporate metrics to measure and
improve product development processes.

Industry Average Steps to Success

1. Streamline processes. Improve the flow of cross-departmental
product development processes to reduce wait times and other waste,
using tools such as value stream mapping. Align information flow with
process flow to further streamline and enhance product development
performance by ensuring that people have the right information, at the
right time, to execute their steps in the process.

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Lean Product Development
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Reduce wasted effort. Identify and reduce all effort that does not
provide direct value to the customer (or is an unavoidable cost of doing
business). Automate redundant tasks using tools like workflow and
Knowledge Based Engineering (KBE) or automated publishing solutions.
Prevent time wasted in search by making information readily available in
a central location and providing advanced search capabilities. Finally,
focus development efforts on projects with high customer value and
prevent expending resources on “dead” projects using product portfolio
management (PPM).
2. Reduce variability. Reduce waste in the form of variability which
provides unpredictability and prevents continuous improvement.
Standardize work processes and deliverables across the enterprise.
While variability is inherent to innovation, reduce the schedule risk
associated with this variability by introducing the use of design sets.
3. Validate designs early. Ensure the designs are correct early in the
development process. Co-develop products to find problems earlier
when they can still be corrected or avoided by utilizing concurrent
design and tools like digital manufacturing (DM) and manufacturing
process planning. Validate cost and supply chain performance in advance
to ensure profitability using product cost management (PCM).
4. Develop a Lean culture. Teach employees the fundamentals of Lean,
and allow them to help identify and execute Lean improvements in the
product development process. Incorporate metrics to measure and
improve processes.

Best in Class Steps to Success

1. Streamline processes. Continue to improve the flow of cross-
departmental product development processes to reduce wait times and
other waste, using tools such as value stream mapping. Align
information flow with process flow to further streamline and enhance
product development performance by ensuring that people have the
right information, at the right time, to execute their steps in the
process.
2. Reduce wasted effort. Continue to identify and reduce all effort that
does not provide direct value to the customer (or is an unavoidable
cost of doing business). Automate redundant tasks using tools like
workflow and Knowledge Based Engineering (KBE) and automated
publishing solutions. Prevent time wasted in search by making
information readily available in a central location and providing advanced
search capabilities. Finally, focus development efforts on projects with
high customer value and prevent expending resources on “dead”
projects using product portfolio management (PPM).
3. Reduce variability. Reduce waste in the form of variability which
provides unpredictability and prevents continuous improvement.
Standardize work processes and deliverables if you have not already
done so. While variability is inherent to innovation, reduce the schedule

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Lean Product Development
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risk associated with this variability with the use of design sets, if you
have not already adopted this strategy.
4. Validate designs early. Ensure the designs are correct early in the
development process. Enhance co-development by utilizing concurrent
design and tools like digital manufacturing (DM) and manufacturing
process planning. Validate cost and supply chain performance in advance
to ensure profitability using product cost management (PCM).
5. Develop a Lean culture. Continue to educate the company on Lean,
and allow employees to become change agents to help identify and
execute Lean improvements throughout the product development
process. Ensure that metrics are being measured on a timely basis to
measure and improve product development processes, and make mid-
course corrections to projects.

Aberdeen Insights – Summary

Lean concepts are proving value in the form of Lean Product Development. Best in
Class companies have been adopting these approaches for some time, and are
reaping the benefits. The actions identified are intended to reduce waste of all kinds,
allowing companies to spend more of their design time on innovating and adding
value to their products for their customers, as opposed to waiting, searching, and
performing redundant tasks. Best in Class companies know this, and are spending
53% more productive time on product development than Average companies, and 1.6
times more than Laggards. As a result, they get products to market an average of
25% faster than their competitors. With results like this, Lean Product Development is
becoming the new standard for excellence in bringing profitable products to market.

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Lean Product Development
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Appendix A:
Research Methodology
In April 2007, Aberdeen Group examined the use of Lean Product
Development in over 400 manufacturing companies.
Responding executives completed an online survey that included questions
designed to determine the following:
• The degree to which Lean concepts are deployed in their product
development process
• Current and planned use of Lean to improve product development
performance
• The benefits, if any, that have been derived from Lean Product
Development initiatives
Aberdeen supplemented this online survey effort with telephone interviews
with select survey respondents, gathering additional information on Lean
Product Development strategies, experiences, and results.
The study aimed to identify emerging best practices in leveraging Lean in
product development and provide a framework by which readers could
assess and improve their own capabilities.
Responding enterprises included the following:
• Job title/function: The research sample included respondents with the
following job titles: senior management (10%); vice president (5%);
director (22%); manager (29%); staff at (24%); and others (15%).
• Industry: The research sample included respondents exclusively from
manufacturing industries. Industrial Equipment was the largest segment
comprising (26%) of the sample. Aerospace and Defense and Medical
Devices each accounted for (19%) of respondents, followed by
Automotive at (18%). Other sectors responding included
Pharmaceutical Manufacturers and Consumer Electronics at (10%),
Computer Equipment and Peripherals, Chemicals, and Consumer
Durable Goods.
• Geography: The majority of respondents (85%) were from North
America. Remaining respondents were from Europe (12%) and the Asia-
Pacific region (2%).
• Company size: About 31% of respondents were from large enterprises
(annual revenues above US$1 billion); 27% were from midsize
enterprises (annual revenues between $50 million and $1 billion); and
41% of respondents were from small businesses (annual revenues of $50
million or less).
Solution providers recognized as sponsors of this report were solicited after
the fact and had no substantive influence on the direction of the research.
Their sponsorship has made it possible for Aberdeen Group to make these
findings available to readers at no charge.

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Lean Product Development
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Table 4: PACE Framework

PACE Key

Aberdeen applies a methodology to benchmark research that evaluates the business

pressures, actions, capabilities, and enablers (PACE) that indicate corporate behavior in
specific business processes. These terms are defined as follows:
Pressures — external forces that impact an organization’s market position, competitiveness,
or business operations (e.g., economic, political and regulatory, technology, changing
customer preferences, competitive)
Actions — the strategic approaches that an organization takes in response to industry
pressures (e.g., align the corporate business model to leverage industry opportunities, such
as product/service strategy, target markets, financial strategy, go-to-market, and sales
strategy)
Capabilities — the business process competencies required to execute corporate strategy
(e.g., skilled people, brand, market positioning, viable products/services, ecosystem
partners, financing)
Enablers — the key functionality of technology solutions required to support the
organization’s enabling business practices (e.g., development platform, applications,
network connectivity, user interface, training and support, partner interfaces, data cleansing,
and management)

Source: Aberdeen Group, May 2007

Table 5: Competitive Framework

Competitive Framework Key

The Aberdeen Competitive Framework defines enterprises as falling into one of the following
three levels of practices and performance:
Best in class (20%) — Product development practices that are the best currently being
employed and significantly superior to the industry norm, and result in the top industry
performance.
Industry norm (50%) — Product development practices that represent the average or norm,
and result in average industry performance.
Laggards (30%) — Product development practices that are significantly behind the average
of the industry, and result in below average performance
In the following categories:
Process — What is the scope of process standardization? What is the efficiency and
effectiveness of this process?
Organization — How is your company currently organized to manage and optimize this
particular process?
Knowledge — What visibility do you have into key data and intelligence required to manage
this process?
Technology — What level of automation have you used to support this process? How is this
automation integrated and aligned?
Performance — What do you measure? How frequently? What’s your actual performance?

© 2007 Aberdeen Group, Inc. Telephone: 617 723 7890

www.aberdeen.com 052907
Lean Product Development
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Table 6: Relationship between PACE and

Competitive Framework

PACE and Competitive Framework How They Interact

Aberdeen research indicates that companies that identify the most impactful pressures and
take the most transformational and effective actions are most likely to achieve superior
performance. The level of competitive performance that a company achieves is strongly
determined by the PACE choices that they make and how well they execute.

Source: Aberdeen Group, May 2007

© 2007 Aberdeen Group, Inc. Telephone: 617 723 7890

www.aberdeen.com 052907
Lean Product Development
Page 19

Appendix B:
Related Aberdeen Research
Related Aberdeen research that forms a companion or reference to this
report includes:
• The Product Innovation Agenda Benchmark (September 2005)
• New Product Development: Profiting from Innovation (January 2006)
• Profitable Product Development for SME (March 2007)
• Digital Product Development (March 2007)
Information on these and any other Aberdeen publications can be found at
www.Aberdeen.com.

Author: Jim Brown, Vice President, Product Innovation & Engineering Research
jim.brown@aberdeen.com
Founded in 1988, Aberdeen Group is the technology- driven research destination of choice for the global business
executive. Aberdeen Group has over 100,000 research members in over 36 countries around the world that both
participate in and direct the most comprehensive technology-driven value chain research in the market. Through its
continued fact-based research, benchmarking, and actionable analysis, Aberdeen Group offers global business and
technology executives a unique mix of actionable research, KPIs, tools, and services.
This document is the result of research performed by Aberdeen Group. Aberdeen Group believes its findings are
objective and represent the best analysis available at the time of publication. Unless otherwise noted, the entire
contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, stored in a retrieval
system, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc.

© 2007 Aberdeen Group, Inc. Telephone: 617 723 7890

www.aberdeen.com 052907