Innovation Advances Yield $50 Million in Savings
Faced with increasing competition from its rivals, a $20 billion global transportation services provider needed to revitalize its innovation practices for new services.
Though the company was prepared to elevate the quality of its research and development processes, management was troubled by the firm’s history of long time-to-market periods for new service launches compounded by the relatively weak productivity achieved with previous innovations.
To help remedy these concerns, the company turned to PRTM, who led an assessment of the company’s innovation and new service development practices. Through the assessment, PRTM identified opportunities to reduce time-to-market by 20%, improve innovation productivity by 40%, and reduce annual development expenditures by $50 million. To meet these targets, PRTM defined an operational blueprint that spanned new idea generation, concept-to-launch practices, project execution team organization, executive governance, portfolio management, training, and performance management.
Subsequently, PRTM helped to implement the operational blueprint across the 8,000-person organization during an 18-month rollout period, delivering 300 training sessions across four geographies. Voice of the Customer (VOC) and Six Sigma techniques were embedded into the company’s concept-to-launch processes, enabling small inter-departmental teams to efficiently manage individual projects through to market launch. More-actively involved executives actually cancelled 50% of development projects with limited prospects, making it possible for the company to focus its resources on the highest-value opportunities. PRTM also helped the company to ensure that new idea generation was more directly linked with overall business strategy.
Within a year of its program’s rollout, the company achieved the anticipated $50 million in cost savings through time-to-market improvements. Internal performance measures documented 30% reductions in time to market across 50 innovation projects, exceeding the company’s initial targets of 20%. Resource utilization improved by 35% across seven functional groups involved in innovation. Finally, enhanced abilities to systematically assess more than 250 new service ideas each year gave the company an even greater advantage in a crowded and highly competitive marketplace.
