Aerospace

    Predictive Product Portfolio Planning Shortens Product Delivery Time

    Situation

    An aerospace manufacturer has a large, complex portfolio of projects and new products to manage. At times, winning new business can be helped by demonstrating to potential customers not only the ability to design and build the needed products, but also the capability to efficiently and cost effectively, run the project and portfolio management (PPM) process. In other words getting the product to market on time and on-budget. This organization is incorporating a predictive modeling based approach to their PPM process.

    Objective

    Develop a capability to improve management decision making agility and their ability to get it right the first time and achieve operational excellence and mission success with each project and each portfolio.

    Results

    • They have a more credible system in place for demonstrating life cycle costs and schedules to their DoD customers when trying to win new business.

    • Gained a much better understanding of the impact on a portfolio from variability and uncertainty in resource demand/ capacity, time lines and project costs.

    • Enabled them to do a better job of setting expectations and making recommendations for the program.

    • Increased their confidence and their customer's confidence in their project plans, program execution and the timeliness of product delivery.

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    Government

    Government Agency Uses Predictive Portfolio Simulation to Reduce Project Approval Cycle Time and Improve Resource Capacity Planning

    Situation

    A government agency whose responsibility involves overseeing and approving very long cycle time (years) and high risk construction projects was struggling with the complexity of managing multiple projects of this magnitude at the same time.  They were facing large resource constraints.

    Objectives

    • Shorten the contract approval cycle time

    • Develop a simplified, yet accurate way, of analyzing long-term resource requirements

    Results

    ProModel worked with the agency to develop a re-usable predictive project portfolio planning capability to help them achieve their objectives both now and in the future.  To date they have been able to achieve the following:

    • Understand more accurately their actual approval process and where the bottlenecks are

    • Test 'What-If" scenarios around potential different courses of action without interrupting their live process

    • Improve the process for forecasting their resource requirements over the next 5-10 years

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    Manufacturing

    Situation

    A leading manufacturer of optical electronics knew it was critical to their success to keep bringing breakthrough products to the market while also meeting corporate performance objectives. Leadership at this company was having a hard time analyzing and predicting the future financial performance of their product portfolio. They were also unable to test different combinations of products to get a good picture of how the combinations affected revenue, profitability, ROI, and resource requirements over their five year planning horizon.

    Objectives

    They have four product "categories" within their New Product Development Portfolio:

    1. Ongoing commercial products

    2. Current "in-flight" products in the development pipeline, but not yet in production

    3. Future products to which they are committed

    4. Potential future products in a "hopper" to which they are not yet committed

    They wanted a more confident way to visualize, analyze, and predict performance of these four product sets over a (6mo-5yr) planning horizon to achieve the following goals:

    • Optimize resource utilization, while staying within budget

    • Maximize long term overall portfolio profitability

    • Meet other corporate financial KPI's for example: 40% of OSD's revenue over the next 5 years must come from new products

    • Predict project attrition and associated impact to cost and revenue

    Results:

    Using this solution, New Product Development Leadership now has more confidence in their planning forecasts and can make more informed and insightful decisions such as:

    • Which of the potential future projects in the hopper should they actually invest in, and when?

    • What combination and sequencing of projects will maximize long term portfolio profitability?

    • What changes are required to stay within budget and on track for revenue goals?

    • How to ensure 40% of revenue over the next 5 years comes from new products?

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    Pharmaceutical

    Product Launch and Revenue Recovery Analysis

    Situation

    A large pharmaceutical manufacturing company was dramatically behind on the launch plan for its latest product. For every month they were late to market, they would lose nearly $2 million in projected revenue. They needed to accelerate their execution to get back to plan, with a limited budget, and were not sure how to get back on track. Based on prior success with ProModel, they asked us to analyze the situation with them in order to determine the best solution.

    Objective

    Determine the best course of action to regain projected lost revenue at the lowest cost

    Pharma Portfolio Planning

    Results

    • Determined the top three cost effective courses of action to recover lost time and revenue.

    • Implemented management's top choice to accelerate the projected launch date by a full month, resulting in $1.8 million in expected revenue for a total cost of approximately $600k.

    • Exceeded their IRR and ROI requirements for investing in this type of recovery project.

    • Learned that had they invested in the particular resource from the start, the product could have launched as much as 8 months earlier, resulting in additional revenue of close to $15 million.

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