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Premature Parallel Development
In the last few posts I have been writing about what I call "Opportunity Wasting Behaviors" or "OWBs." Continuing that thread, this article is about "Premature Parallel Development."
I use the term "parallel development" to refer to the situation where an organization divides its development resources into teams and puts them to work developing two or more products concurrently.
Sometimes, this is done as a response to the reality of shrinking product lifetimes.
Let's say that a given product has a lifetime in the market of six months. That is, once it is introduced to the market it is expected to be viable for only about six months.
If the development of products of this type takes about one year then the company must begin the development of the replacement product for this market at least six months before the first product is launched.
Not only that, but the development team assigned to the development of the first product will have to begin development of the third product in this line as soon as it has launched its first product.
So this is one example of how the need for parallel development arises. When the product development lead time exceeds the product lifetime in the market, parallel development usually becomes a necessity.
Companies may embark on parallel development efforts for other reasons as well.
For example, the desire to enter a wholly new market with a significantly different product offering may spur the company to fork its development resources. One group will continue to develop the existing products, while the other will embark on the development of the product offering for the new market.
Alternatively, a company might take a fraction of its development resources and put them to work on a project that is designed to improve the company's product development process itself. This is also a kind of parallel development.
It seems clear that there are many reasons why a company may wish to undertake parallel development efforts. But I suggest that we should look a bit deeper before taking such a leap.
Consider the following.
JSoft is a leader in application servers. In this case, an application server is software that enables web-based enterprise applications to run on a server computer.
JSoft is in a highly competitive market. They are currently the market leader and are consistently releasing new products far more quickly than their nearest competitors. As such, most of their competitors are constantly forced to play "catch up" with JSoft. JSoft is also taking the hefty premiums that are paid for being first to market with problems that solve customer's serious problems.
One day, at a meeting of the JSoft Board of Directors, two of the directors point to a potential new market -- application servers for embedded devices. This is a significantly different market for JSoft and not one in which it has any significant expertise.
The issue is debated and, reluctantly, JSoft's CEO agrees that the company will investigate this new market.
Over the next few months, JSoft investigates the market. As the work proceeds, the investigation team becomes more and more invested in the idea. For some reason they have trouble seeing the "negative branches" that they are about to create for JSoft.
Eventually, a decision is made that JSoft will make the necessary investments to get into this market. Meetings are held and a new parallel development effort is launched.
The development teams are split into two groups. The largest of the groups will continue to develop and maintain the original product line. The smaller group -- consisting of about 30% of the development resources -- will begin work on the new product, "JSoft For Embedded."
Development proceeds and both teams eventually ship their products.
The team maintaining the original product shipped a couple of months late. This was expected as 30% of the resources assigned to the project were no longer available. There were also the effects of the reorganization of the Product Development group into the two teams. This was said to account for some lost time.
The team developing JSoft For Embedded also shipped its first release later than expected -- and with a reduced set of capabilities. In the post-mortem, the consensus was that the learning curve for this new area was larger than expected.
Over the next year both groups seemed to settle in to their new roles. Sadly, the market for JSoft For Embedded did not develop as quickly as forecast. The sales of JSoft For Embedded were somewhat disappointing and this business was not yet profitable.
Fortunately, the main business was still profitable, but it was also clear that some negative trends were developing. JSoft's nearest competitor, ASI (Application Servers, Inc.) was gaining ground in the market and had recently surprised JSoft by releasing a new version of their software that contained several features that JSoft's product did not have.
Over the next year the situation became even worse. The market for embedded application servers was not developing as hoped and JSoft was struggling to get sales in this space. From time to time, members of the JSoft For Embedded team were "borrowed" to help out on the development of the main product line. As this multitasking became more and more common the situation seemed to deteriorate even further.
Eventually, JSoft's management shelved the JSoft For Embedded project and reassigned the developers to the main product development team.
However, by this time, ASI had a firm lead in the market and it was JSoft that was forced into second-tier status. JSoft was also sued by some of its early customers in the embedded application server domain, when it could no longer honor the support agreements for JSoft For Embedded that it had extended to these customers.
Hopefully, the example given above makes clear the dangers of embarking on a parallel development effort before the company has the resources necessary to fully support it.
In the above example, JSoft did not have sufficient capacity to staff two large development efforts at the same time.
By diluting their efforts, they wound up delivering two new products, but their deliveries were so late that in their primary market they gave up the "high ground" of being consistently faster than their competitors. This gave their primary competitor, ASI, the chance they needed to take over first place.
The bottom line is this. Parallel development is ofen the right choice for an organization. It can and does make perfect sense under certain conditions.
One of those conditions, however, is that by embarking on a parallel development the company will not be forced to give up its leadership position in any significant markets. If this condition is not met then it is almost certainly only a matter of time before reality will catch up with the organization and force it into a situation where it is "CTD" -- a term paramedics sometimes use with a seriously ill patient who is said to be "Circling The Drain."
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