PreQuip, a scientific instruments company, developed an aggregate project plan to address issues with late product development projects. The aggregate project plan helped identify needed changes and how those changes connected to product and process development. Developing an aggregate project plan provided benefits like building a capacity cushion to avoid overcommitting resources and improve productivity. It also allowed for dealing with unexpected opportunities that arose. Hill-Rom similarly gained improvements by developing two new platform products using an aggregate project plan, achieving lower costs, higher quality, and more satisfied customers. Companies used strategic criteria like market maturity when selecting and sequencing projects in their aggregate project plans.

1. CASE 2:
CREATING PROJECT PLANS TO FOCUS PRODUCT DEVELOPMENT
Group 5
HSIU-CHING, HO
CHENG-HAN, WU
CHEN-CHIA, HUANG
YA-TING, CHAO
YI-TING, PENG

2. BACKGROUND
PreQuip, a large scientific instruments company
 Problem: A rush of late product development project (during mid-1989).
 A late product development raise the development budget while the number of
completed projects declined.
Hence, many of the projects in the development pipeline no longer reflect the needs of
the market.
 Solution : Aggregate project plan.
Aggregate project plan: helps identify where companies need to make changes and how
those changes are connected to product and process development.

3. A. WHAT BENEFITS DID PREQUIP AND HILL-ROM GAIN BY DEVELOPING AN
AGGREGATE PROJECT PLAN?
PreQuip’s:
 PreQuip builds a “capacity cushion” into its plan to avoid over-committing
resources and improve productivity further.
 PreQuip takes advantage of unexpected opportunities to deal with arose-
crises by leaving a small percent of development capacity uncommitted.

4. A. CONTINUE
Hill-Rom :
 Improvement (by developing an aggregate project plan):
Introduce new technologies and new product features by developing two new
platform products- the Centra and Century.
 Result (gain by developing an aggregate project plan):
Lower unit cost, higher product quality, and more satisfied customers.
With an “ aggregate project plan,” companies map out and manage a set of
strategic development projects.

5. B. WHAT STRATEGIC CRITERIA DID THEY USE TO SELECT AND
SEQUENCE PROJECTS IN THEIR AGGREGATE PROJECT PLANS?
 PreQuip:
 Defining and putting existing projects into five types of aggregate project plan.
 Challenges:
1. Market and technology are mature.
2. Competitors performance (providing same capabilities but lower
price)
3. Customers considered more in price.
 Solution:
Focus on platform
Map out new product lines

6. B. CONTINUE
 PreQuip (sequence projects):
 Using steady stream sequencing strategy
 Example:
New mass spectrometer (C series)
C 101  C-1/X  C-1/Z

7. B. CONTINUE
 Hill-Rom
 Challenges:
1. Mature market
2. Stable technologies and changes are little
 Solution:
 Focus on platform (using in hospital)
 Limit product lines

8. B. CONTINUE
 Hill-Rom (sequence projects):
 Using secondary wave planning
 Example: the Centra and the Century

9. C. HOW DID PREQUIP AND (HILL-ROM) USE THE PROJECT MAP TO
MANAGE ITS DEVELOPMENT ACTIVITIES (INCLUDING ALLIANCES)
 Derivative projects
 Breakthrough Projects
 Platform projects
 Research & Development
 Alliances and Partnership projects

10. C. CONTINUE
 Prequip finally attain 20% to derivative projects, 50% to platform project,
and 10% each to breakthrough projects and partnerships.
 Hill- Rom focus on platform project by developing two new platform
products -- the Centra and Century

11. D. HOW DOES THE MATURITY OF THE MARKET FOR THE PRODUCT LINE
IMPACT THE PROJECT MAP?
In the beginning stage of growth:
 Products are different from previous
generations
 Adapt the breakthrough-platform
strategy
After the market position become
more maturity:
 Mainly focuses on the cost-reduced
 Enhancement to the exciting
products
 Adapt derivative project strategy

12. E. SHOULD THERE BE AN AGGREGATE PLAN FOR THE ENTIRE COMPANY OR FOR
INDIVIDUAL PRODUCT LINES? WHAT ARE THE PROS AND CONS OF EACH?
 For the entire company:
 Pros:
1. Enable to help company reach to its goal.
2. Prevent resources waste.
3. Integrate projects and allocate resources efficiently.
4. Improve overall market position.

13. E. CONTINUE
 Cons:
1. Need long period to do the analysis and execute the plan.
2. Cost on changing existing project plan to aggregate project plan.
3. Need high level management involved communication among
different projects.
4. Change management and company culture challenges.

14. E. CONTINUE
 For the individual product lines:
 Pros:
1. Improve higher capabilities of products.
2. Extend from previous product to alterative and new generation
products.
3. Reach closer to market and customers’ needs.
 Cons:
1. Training cost.
2. High level skills transfer required.

15. F. CAN THE CONCEPT OF THE AGGREGATE PROJECT PLAN BE APPLIED TO OTHER
PROJECT TYPES BESIDES PRODUCT DEVELOPMENT PROJECTS?
 To employee’s skill development.
 more efficient and effective
 advance research v.s. commercial development.
Derivative
projects
• Junior
engineer
Derivative
projects
• Senior
engineer
Derivative
projects
• principal
engineer

16. Thank you

17. Q & A