Setting a price for your product is one of the most important decisions a medical device startup will ever make. A recent A16Z podcast reminds us that “There’s no other single number that ties to the valuation” of your company.
Once set, prices are hard to raise. If you price too low, you can leave millions of dollars of revenue and profits on the table, starving your company of the funds it needs to re-invest in growth. If you price too high, product adoption will suffer.
I’ve been tracking first-time venture financing of medical device companies in New England since 2005. Whew!
Startups are where innovation really happens. It takes the dedicated focus of a startup to drive real change to our healthcare system. A first venture funding is a validation of technology, market and business model. A key metric of the health of our local medical device innovation economy is the rate of new startup funding.
I also track startups because I want to provide a list of funded startups to the local community – job seekers, venture investors, and service providers. Startups have a hard time finding the right connections in the community, and vice versa. Maybe I can make it a little easier.
I’ve counted nine venture-funded medtech startups in 2015, of which one is a restart, one has no medical device products (but may), and one is a Ukrainian company with a Boston-area office. Given the venture funding environment, 2015 was a respectable, thought not stellar, year for venture funded medical device startups in New England.
Managing concept phase projects is challenging with any project management tool or technique, because you start with almost no certainty about the tasks that will be needed. We can surely imagine some work on concept brainstorming, preliminary requirements definitions, market research, component ordering, prototyping, concept testing, and report writing. But it’s really hard to be much more granular than that, when we haven’t even defined requirements or brainstormed concepts yet.
Vendors have lead times. New custom components can have really long lead times. Long lead components are the most incompressible of project tasks, so you need to manage them closely.
I’ve seen all the screw-ups: parts and orders misplaced, fires at vendor plants, incoming inspection backlogs, you name it. As a project manager, it’s your job to prevent these errors and keep the trains running on time.
Your project is capacity limited, but without a Critical Action Plan, you don’t know how limited. You may think you need another engineer or technician, but a Critical Action Plan can really help you define and justify hiring needs.
Scopes change. It’s practically a law of physics. Even if the overall project goals don’t really change, we often find that the project is harder to accomplish than we originally thought. During the project we often discover a need for new features, or our regulatory strategy changes.
Critical Action Planning makes it easy to incorporate and quantify scope changes. In fact, simple quantification of scope and progress is one of the key benefits of the Critical Action Planning approach. It’s a by-product of the technique, that requires virtually no extra work.
Within a medical device project, “division of responsibility” among project team members is usually the default. “Division of responsibility” enables team members to feel ownership of major components of product design and simplifies accountability for project managers. What’s not to like?
New day, new data, new priorities. Like all Agile approaches, overall project execution is optimized when the highest priority tasks are performed in each “Select-Perform-Assess” cycle. So great project performance depends on great prioritization.
The project manager should expect to spend significant time every week re-prioritizing the Project Backlog, with the help of the team, incorporating project learnings and new information from the outside world into the existing project plan.
I’ve identified seven keys to Project Task prioritization, which actually can be used with any type of project management. For example, while dependencies in Gantt charts create a natural sequence of many project tasks, Gantts provide no prioritization when multiple tasks are ready to be started.
While perfection is surely the enemy of the good when it comes to task prioritization, an analytical approach can reduce errors and help the team achieve consensus on priorities. Here are the seven keys I recommend.
Capacity is king. You can’t do more than one week’s worth of work this week. Sounds obvious, right?
Most of the time, though, we take on too much, and end the week in frustration with lots of work still in process. When project teams take on too many tasks at the same time, everyone struggles with the ambiguity and morale is endangered.
Critical Action Planning uses the kanban technique of limiting work-in-process (WIP) to get things done.
How does the Select-Perform-Assess Cycle work in practice?