The Albright Strategy Group

Roadmaps and Roadmapping Technology Futures Strategy

www.albrightstrategy.com

Roadmapping and Portfolio Process

Pragmatic Portfolio Management for Product Development February 21, 2002 Phoenix, Az
realbright@albrightstrategy.com

Long Term Planning:

Richard E. Albright

v2

2002 The Albright Strategy Group, LLC

Key Points
Portfolio Management is a Process
The key link among strategy, product development, and operational processes. Multiple portfolios of markets, offers, products/platforms, and technologies.

Roadmaps and Roadmapping

Help product teams link business strategy, product plans, and technology development. Enable clear communication with customers and suppliers, and serve as a guide for the team.

Roadmaps and Portfolio Management

Roadmaps clarify the unknown future and provide information for intelligent decisions Roadmaps help manage offer, product and technology portfolios Roadmapping and Portfolio Management are continuing, cyclical processes.

2002 The Albright Strategy Group, LLC

Portfolio Management:
In the Context of Business Processes
Portfolio Management: a critical linking process Cross-functional responsibility:
Strategy + Marketing + Product Development.
Process View of Business Process View of aaBusiness
Marketing & Sales Process
Market Segmentation Create Offers and Mktg Plans Sales & Delivery

Portfolio Management Process

Shape Fit An unconstrained view of a target portfolio Decide on the portfolio constrained by financial and development resources and capabilities. Direct investment plans, market plans, and project plans in line with the approved portfolio.

Manage

Portfolio Management Process Strategy Creation & Management Process

Shape Fit Manage

Product Delivery and Services Process

Product Development Gates

Concept
Conceive Concept Define Proceed Develop Launch Deploy & Manage Exit

Develop prototype With development The product in the market The market

Proceed Launch Exit

Product Development Process R&D, Financial, HR Processes

2002 The Albright Strategy Group, LLC

A Corporations Several Portfolios

Marketing Market Market Segments Segments ~ Tens

Multiple portfolios Correlated elements Portfolio Measures

Value Balance Strategic Alignment

Marketing & Product Management

Offers Offers

~ Tens Hundreds

Roadmaps support portfolio management

Product Management Products/ Products/ Platforms Platforms ~ Hundreds

Technologies Technologies R&D Primary Responsibility ~ Thousand(s) (Order of Magnitude)

4

A roadmap defines a product with links to strategy, market, technology. Roadmaps for offers link products, markets, strategy. Roadmaps include the drivers and plans to manage the technology portfolio.

2002 The Albright Strategy Group, LLC

Roadmaps and Roadmapping

A Roadmap
is the view of a group of how to get where they want to go, or achieve their desired objective. (Discipline) helps the group make sure the capabilities to achieve their objective are in place at the time needed. (Focus)

Roadmapping
is a Learning process for the group. is a Communication tool for the group.

2002 The Albright Strategy Group, LLC

Product-Technology Roadmap
A Business Planning Tool
Feature Evolution Plan
Last Year Now + 1 Year +2 Years +3 Years VISION

Product Evolution Plan End User Value

Product Architecture
Antenna Display RF Battery

Risk Roadmap
Risk Categories
NOW
Risk m1 [.4] Risk m2 [.5]

+2Q

+4Q

+6Q

LONG-TERM
Risk m3 [.2]

Market
(growth,strategy, product attributes, etc.)

market events

Technical
(component or system performance) test events

Risk t1 [.2]

Risk t2 [.1]

Risk t3 [.5]

Experience Curves Competitive Strategy

Strategy Options
Best Product Basis of Competition Customer Solutions System Lock-In
Power Management Keyboard Housing PWB ICs Discretes Software

Baseband

Forward Cost Model

$200.00
Manuf acturing Cost Component #1 Component #2 Component #3 Component #4

Map to Investments
(deliverables) completion events

Schedule

Risk s1 [.3]

Risk s2 [.1]

Technology Category Component #1

1999 $89.21

2000 $79.21

2001 $60.00

2002 $45.00

2003 $39.00

Target $28

Source

Economic

Risk e1 [.2]

Risk e2 [.1]

(cost, contract, budget) completion events

Competitive Impact of Technology

Component #2

$20.00

$19.53

$18.00

$17.00

$15.00

$10

Disruptive Resource

Risk r3 [.4] Risk r1 [.1] Risk r2 [.6]

$150.00

Specialized Labor Installation Misc. TA RGET

Component #3

$10.50

$9.38

$8.45

$4.37

$2.05

$2

Potential to change the (e.g., organizational, basis of execution)competition completion events

Monitor
Risk Consequence:

Component #4

$15.40

$14.11

$12.30

$8.50

$8.30

$8

Attack

Minor

Major

Show Stopper

Implications

Scope
(what can be varied in the product)

Product Driver/Targets
KEY DRIVERS: KEY DRIVERS: 1. Product Driver #1 1. Product Driver #1 2. Product Driver #2 2. Product Driver #2 3. Product Driver #3 3. Product Driver #3 SECONDARY DRIVERS SECONDARY DRIVERS 4. Secondary Product Driver 4. Secondary Product Driver 5. Secondary Product Driver 5. Secondary Product Driver 6. Secondary Product Driver 6. Secondary Product Driver
D river #1

Specialized Labor

$5.00

$4.50

$4.30

$4.10

$3.10

$5

COGS

Competitive Landscape
Metric

C p ometitor S gth (+ a d tren s ) n Bonding (sh base) are; w n ea (how to gaink esses(-) C pn oma y
(x% y ) ;%
advantage)

C C p cy ore ometen

S tegicG ls tra oa

V eP osition alu rop

XX X

Current Current Position Position lag lag lag lag Parity Parity

Goal Goal Parity Parity Lead Lead Lead Lead

Reqd Reqd Invest. Invest. M M H H M M

1 .0 0

Map to Elements
Installation $9.43 $8.33 $7.95 $6.58 Misc. $4.67 $4.35 $4.23 $4.21

$100.00

Differentiating
Product/Process Differentiation

$6.34

$4

$4.15

$5

Product Drivers

$50.00

$154 $139 $115 $90 Technology Roadmap Product$15 Elements$5 Manufacturing Cost $25 $7 Material Cost

$78

$62

Action Summary
Product & Technology Strategies: : Product & Technology Strategies Base
Lead in: Lead in: Lead in: Lead in:
Widespread and Shared

Defend

$4

$5

Architectural Fit
$0.00 1999 2000

TOTAL COST

$179

$154 TE1 $150

$122

$95

$82

$67 From product plan with 70% learning curve

Ease of training and use

2001 2002 2003 Target

COST TARGET

$170

$104

$75

$67

$67

TE2 TE3

Tech. Area
Area #1 Area #2

Now

Acquire
Driver #1

+2Q

+4Q

Partner

+6Q
Driver #1

Develop

Vision

Product #1 Product #1

red = World Class red = World Class

D er# riv 2

1 .0 19 97

19 98

19 99

20 00

20 01

20 02

20 03

20 04

Value Functionality

Technology Source
Product E1

$?M/ ?HY
Driver #1, Driver #2

C p ometitor #1
(x% y ) ;%

Increasing switching costs

Baseband circuit

Customer Drivers
C p ometitor #2
(x% y ) ;% Cmetito C ustom er Driver #1 op r #3 (x% y% ; )

MaptoProductDrivers
*, * Best Other Vendor
$10.00
1.0 0

Dashed lines represent improvement rate expected from 80% slope on learning curve

Technology Roadmap
TE4 TE5 TE6
ACA 1 83 2 CM O S B ip ola r d iscretes 8 bit C IS C 1 6 bit C IS C m icro co n troller 1.4m m 6 la ye r 1m m 4 -lin e L C D N a vig a tio n k eys M en u d rive n N iC d - 4.8V L inea r - 5 0% effic ie n t M o du le T rip le con ve rsio n D u al b and , H ig h g ain V c elp E xp an d e r P iez o ele ctric D ou ble co nv ersion D iv ersity IT U , Q ce lp 1 3 IS -99 D a ta B E R Im p rov em ent/e c ho c a nc el. F irs t o rd er g rad ien t (F O G ) N oise c an ce lling e arpiec e, m iniatu riz e d F un ding sta tu s: S taffe d S tee ring array CF CF C o nfigu ra ble N iM H - 3.6V S w itch ing (80 % eff.) M M IC -3 V H o m od y ne T u na ble , H om o dy n e 1 .7m m th ic k 6 la ye r 1.5 m m 2-lin e L C D In teg rate d C a ll sig na l proc . CF

Area #3
.

Product #1

$?M/?HY
Product #1

Interoperability
Now

Area #4
$?M/?HY
Product #4

Customer or Complementor Drivers

Mz H

Product Drivers (Attributes)

PD1

P ro du ct d riv ers C o re tec hn olog y A re a W e ig h t/siz e In te rfa ce A S IC DSP A u dio co de c A u dio f ro nt en d M ic roc ontro ller

Last Yr

$/unit

Service/Support
57 35 C hip

+1 Year

+2 Year

+3 Year

V IS IO N

Im po rt.

C o m p et. P o sition

Area #5
CF C F C F C CF CF CF CF C F CF CF F C CF CF CF CF C F C F CF C F CF CF CF CF CF C F CF C F CF F C F CF CF C CF M o lde d-in V oic e Interfac e F CF

$?M/?HY
Product #4

Architectural Fit
$1.00 1997 1998 1999 2000 2001Ease of training 2002 2003 2004
1 .0 19 9 19 9 and7use8 19 99 20 00 20 01 20 02 20 03

TE7S in glend B as e ba
C h ip

S o ft R ad io

Area #6
$?M/?HY

20 04 PD2

H ou sin g PW B E ase o f u se D isp lay U ser in te rf ac e S oftw are T alk tim e B attery P ow e r sup ply P o w er a m p R a dio

Prioritize top tombottom 1.2 m

4 lay er 0.8m m F lex 1 /4 V G A T ou ch S e ns itive

C ustom er Driver #2 C ustom er Driver #3

Comp etitor #2 Comp etitor #1 O urCo

Intellectual Property & Standards Strategies

Product #1

Driver #1 Driver #2 Driver #3

Value Functionality

PD3 PD4 PD5 PD6

Version 3.1 (upgrade)

Product Roadmap
Interoperability

C u st. a da ptiv e A lte rn . tec h . ~ 10 0% effic.

Market Definition
C ustom er Driver #4 C ustom er Driver #5
Market Size
250 Market Size ($M) 200 150 100 50 0
-1 0 +1 Segment/Product Segment/Prod

Last Year

NOW

+ 2Q
Service/Support

+4 Q
Version 2. 1 (defeatured)

+6 Q

+8 Q

VISION

A nte nn a A u d io q u ality V oic e c od ers

PD7

Market Description: Product, Customers, Segmentation, Geography,

Software Products
1

Version 1.0 Version 2.2 (full-featured) Version 2.3 (evolvable)

Version 4.1 (defeatured) New SW Platform (Chicago)

D S P n oise a lgo rithm s M ic ro ph on e R ec eiv ers

Prioritize top to bottom

-1 25 O urCo Lags
Revenue ($M) 20 15 10 5 0
+5 -1 0

Market Share ($)

0
Fraction of market captured

Market Share (qty)

(segment #1)

O urCo Leads
20% O urCo rel. position
Segment/Product

25%

Version 4.2 (evolvable)

L E G E N D : T ec h no lo gy S o urc e : D ev el. S u pp lier S up plie r

L M H L ag Le ad C = c urre nt, F =future P lann ed U n pla nn ed

Inte rnal

R e sea rc h

Summary and Action Plan

15% 10%

New Platform Architecture (Bernini) Machiavelli

-1 0 +1 +2 +3 +4 +5

RF

Segment/Product B Segment/Product C +1 +2 +3

5%

Segment/Product +2 +3 +4

+4

+5

Time

Time

0% Time Segment/Product A Segment/Product B Segment/Product C Overall Market Share

250

Market (Units)
Segment/Product A Segment/Product B Segment/Product C

25

Market Share (Units)

200

20

System Products
(segment #1)

Leonardo

Medici

Galileo

150

15

Michaelangelo

Technology Roadmap

100

10

50

-1

+1

+2

+3

+4

+5

-1

+1

+2

+3

+4

+5

Time

Time

Market and Competitive Strategy

Product Roadmap

2002 The Albright Strategy Group, LLC

Roadmap Planning in Four Steps

Know-why
Market and Competitive Strategy
Understand customer buying behavior (customer drivers) and feasible strategies. Target key segments. Identify competitors, complementors, and partners.

Know-what
Push (capabilities)

Product Roadmap
Pull (requirements, drivers)

Decide how the product will be differentiated to win in key segments. Translate overall customer drivers into product drivers for this specific product. Set multi-year targets.

Know-how

Technology Roadmap

What technologies are most important? Link product drivers to hardware, software, and manufacturing technologies. Identify multi-generation technology investments to maintain competitiveness.

To-Do

Summary and Action Plan

What resources and investments are needed? Plan projects with the highest priorities. Are technology investments in the most important areas? Identify and track risk areas.

Time
(Sources: Tom Kappel; Phaal, R., Farrukh, C., and Probert, D., Fast-start Technology Roadmapping; Richard Albright.)

Know-when
7 2002 The Albright Strategy Group, LLC

1. Market and Competitive Strategy:

Wireless Handset Example
Competitive Landscape
Competitor (Market share annual %; cumulative share %)
OurCo (20%; 10%)

Wireless Handset Example

Strengths (+) and Weaknesses (-), Competitive Advantages

Core Competencies Partnerships, Alliances

DSPs and algorithms Speech recognition RF

Strategic Direction: business goals/targets, value proposition

+ + Intellectual property + RF design - Brand name- Manufacturing cost

Market Share and Growth

Addressable Market
40 Internet Msging Lucent units sold (millions) Digital Units sold (millions) 30 Analog

First to market with CDMA Low-cost GSM phone Mass market (retail outlets) Low size and weight Personalized terminal Strategy Global wireless leadership Defend market share Continue quality program Increase US capacity Fast follow new technol. #2 in everything Make CDMA dominant Control standard Countermeasures Move market to be style/feature based

Our share of market Competitor A

10 9 8 7 6 5 4 3 2 1
(?%; ?%)

Internet (40%; 30%) Msging

Competitor B Digital

+ Wireless focus + Brand name recognition 50% + Quality focus + Low cost advantage + Supplier management 40% + Low cost manufacturing

Our market share RF

Analog Custom IC's Digital Quality/reliability Msging Vision/commitment
Low cost mfg structure TOTAL Expertice in all standards Product realization potential CDMA technology

Internet

Analog

Fraction of units sold

(25%; 25%)

Move to outsourced manufacturing. Partner with chipset suppliers Bring new internet features to market early

Competitor C

20

+ Consumer brand name + CDMA capability/IP - Manufacturing experience

30%

20%

Customer Drivers
120

10

10%

0
-1 yr now +1 yr +2 yr +3 yr +4 yr +5 yr

0
-1 yr now +1 yr +2 yr +3 yr +4 yr +5 yr

0%

-1 yr now +1 yr +2 yr +3 yr +4 yr +5 yr

Antenna RF Battery

Display
100
TARGET GROWTH SEGMENTS: Digital and Internet TARGET GROWTH SEGMENTS: Digital and Internet

80

Market %

60

40

Market Segment Trendsetters Mobile Professional Mobile Home Emergency Convenience

KEY/TARGET CUSTOMERS: Carrier 1, SvcProv 2, Pink KEY/TARGET CUSTOMERS: Carrier 1, SvcProv 2, Pink

Baseband

20

Talk Time

Price

Style

In Touch

Real Time Info

Power Management Keyboard Housing PWB ICs Discretes Software

Customer Driver

2002 The Albright Strategy Group, LLC

2. Product Roadmap:
Wireless Handset Example
Customer Drivers
Price Style Talk Time In Touch Battery Life Info Access
Antenna Display RF
$1,000 $800 $600

Wireless Handset Example

Product Drivers link Customer Needs to Technologies and Targets

Target Cost and Price

Product Drivers
Cost: Materials Assembly time Size Weight
1000

$400 $300 $200

200 gram

$100 $80 $60 $40 $30 $20 $10 -1 Yr

150 gram 100 gram 3721 3725 70 gram

Price Range Cost

Now

+1 Yr

+2 Yr

+3 Yr

+4 Yr

SIZE AND WEIGHT

Lead in Size & Weight

Volume (cc), weight (g)

Messaging Web Connection

Battery

10

BATTERY LIFE/TALK TIME

Target: Size
Competitor

100 Hours.
Qcompetitor A Competitor B Good

Baseband

Target:Weight
10
-1 yr now +1 yr +2 yr +3 yr Vision

Power Management Keyboard Housing PWB ICs Discretes Software

1
-1 yr now +1 yr +2 yr +3 yr Vision

2002 The Albright Strategy Group, LLC

Wireless Handset Example

Using the Past to Forecast the Future

Experience Curves Capture Many Drivers
WIRELESS HANDSET PRICE
10,000
7,000

Culture: group, corporate, Culture: group, corporate,

professional, and industry professional, and industry behaviors behaviors

70% slope (Rate of Learning)

Market Price/unit (1996 $)

4,000 84 2,000 86 88 90 92 400 94 200 96 98 2000

Supply: technology that Supply: technology that

1,000
700

differentiates or disrupts, differentiates or disrupts, product platforms, product product platforms, product realization methods, realization methods, production production

Demand: marketplace, Demand: marketplace,

elasticity, competition level, elasticity, competition level, regulatory climate, market regulatory climate, market learning potential learning potential

100 0.1

0.2

0.4

0.7

1 10 Cumulative Units Sold (Millions)

20

40

70

100

Operating Operating Environment: system Environment: system

architecture, complex architecture, complex requirements, standards requirements, standards

10

2002 The Albright Strategy Group, LLC

3. Technology Roadmap:
Organized by Drivers
Price Style Talk Time
Product drivers Core technology Area Baseband circuit W eight/size Interface ASIC DSP Audio codec Audio front end Microcontroller 8 bit CISC 1.7m thick m 6 layer 1.5m m 2-line LCD Menu driven NiCd- 4.8V Linear - 50%efficient Module Triple conversion Dual band, High gain Vcelp Expander Piezoelectric Internal Double conversion Diversity ITU, Qcelp13 IS-99 Data BER Improvement/echo cancel. First order gradient (FOG) Noise cancellingearpiece, miniaturized Research Funding status: Staffed Planned Unplanned Steering array

Wireless Handset Example

Size/Weight Battery Life

Technology Roadmap
Last Yr Now +1 Year
ACA 1832 CMOS Bipolar discretes 16 bit CISC m icrocontroller 1.4mm 6 layer 1mm 4-line LCD Navigation keys Configurable NiMH- 3.6V Switching (80%eff.) MMIC-3V Homodyne Tunable, Homodyne 1.2mm 4 layer 0.8mmFlex 1/4 VGA Touch Sensitive Molded-in Voice Interface

Cost

Target Cost Breakdown

+3 Year VISION
Im port. Com pet. Position CF
$200
ICs RF

+2 Year
Integrated Call signal proc.

5735 Chip

CF Single Baseband Chip Soft Radio

CF CF CF CF C F C F CF CF CF CF CF CF CF CF CF FC CF CF CF CF CF CF CF

DISCRETES HOUSING DISPLAY

$150

BATTERY PWB MANUF.

Housing PWB Ease of use Display User interface Software Talk tim e Battery Power supply RF Power amp Radio

C ost

CF CF CF CF CF CF CF CF

TARGET

Cust. adaptive Altern. tech. ~100%effic.

$100

Antenna Audio quality Voice coders DSP noise algorithms Microphone Receivers

$50

CF CF CF CF CF
$0
Comp "A" Now +1 yr +2 yr +3 yr +4 yr Target

LEGEND: Technology Source: Devel. Supplier Supplier

L M H Lag Lead C=current, F=future

11

2002 The Albright Strategy Group, LLC

Roadmaps Drive Many Process Steps

Communicate vision and direction to customers Process View of Business Process View of aaBusiness
Marketing & Sales Process

Decision Support

Market Segmentation

Create Offers and Mktg Plans

Sales & Delivery

Portfolio Management Process Strategy Creation & Management Process

Shape Fit Manage

Communicate vision to Suppliers

Product Delivery and Services Process

Competitive Strategy

Conceive Concept

Define Proceed

Develop Launch

Deploy & Manage Exit

Product Development Process R&D, Financial, HR Processes

Product Roadmap

Action Plan
12

Monitor Risk Roadmap

2002 The Albright Strategy Group, LLC

Roadmaps and Portfolio Management

A Product-Technology Roadmap
Defines the measures for portfolio management
Value, Strategic Alignment, Balance
Roadmap of Roadmaps
Example: Wireless Solution Roadmap
CO NTENTS M a rk e t s h a re a n d g ro w th C o m p e t it i v e s t r a t e g y P ro d u c t R o a d m a p P r o d u c t a t t r ib u t e s a n d d r iv e r s P r o d u c t e v o lu t io n p la n T e c h n o lo g y R o a d m a p F o r w a r d c o s t in g m o d e l M a n u f a c t u r in g R o a d m a p T e c h n o lo g y a t t a c k s t r a t e g y

Wireless Services Roadmap Wireless Handset Roadmap

C o n tr ib u to r s /N o te s :

Wireless Infrastructure Roadmap

C o n t a c ts / R o a d m a p O w n e r :
Jane Q . R oadm apper + 4 4 -x x x - x x x - x x x x h a n d le @ lu c e n t. c o m e le c t r o n ic v e r s io n : h t tp :/ /B U .lu c e n t .c o m /r o a d m a p 9 9

Page 2 3 4 5 9 10 11 13 14

T h is is a n e x a m p le o f a r o a d m a p fo r a b u s in e s s p r o d u c in g w ir e le s s h a n d s e ts , d e s ig n e d to illu s tr a te f o r m a t a n d t h e r o a d m a p p in g p r o c e s s . T h is r o a d m a p h a s b e e n d e v e lo p e d fo r illu s tr a tiv e p u r p o s e s o n ly - - it d o e s n o t r e p r e s e n t a n a c t u a l L u c e n t b u s in e s s .

F o r a s s is t a n c e w it h r o a d m a p p in g , c o n t a c t th e L u c e n t T e c h n o lo g y O f fic e : R ic h A lb r ig h t + 1 9 0 8 -5 8 2 -3 5 8 6 r a lb r ig h t@ lu c e n t. c o m h tt p : // in fo v ie w .lu c e n t .c o m /lu c e n t/ c to

BB u snn e s sSS r a a e e g y :GG o o wL L u c e nssww ir e le s st e emm in a lb b u s in e s sfrfr o m4 4 Mu u n itsto 7 7 .5MMu u n itsinin4 4y e e as sww h ileh h o ld in g u s i i e s s t tr t t g y : r r w u ce nt t ir e le s s r in a l u s in e s s o m M n its .5 n its ar h ile o ld in g t r to y r

Wireless Solution Roadmap

C o n tr i b u t o r s / N o te s :
CO NTENTS M a rk e t s h a re a n d g ro w th C o m p e t it iv e s t r a t e g y P ro d u c t R o a d m a p P r o d u c t a t t ri b u t e s a n d d r iv e r s P r o d u c t e v o lu t io n p la n T e c h n o lo g y R o a d m a p F o rw a rd c o s tin g m o d e l M a n u f a c t u r in g R o a d m a p T e c h n o lo g y a t t a c k s t r a t e g y Page 2 3 4 5 9 10 11 13 14

2 0 % m k t s h a r e b y o ff e r in g s m a lle s t , lig h te s t p h o n e o n m a r k e t a t a v e r y , c o m p e t it iv e p r ic e . T a r g e t C D M A & G S M s e g m e n t s 2 0 % m k t s h a r e b y o ff e r in g s m a lle s t , lig h te s t p h o n e o n m a r k e t a t a v e r y , c o m p e t it iv e p r ic e . T a r g e t C D M A & G S M s e g m e n t s b b yb b e in gf ir ir t tt o omm ak e e tww h hlig h h tw e ig h tCC D M Ap p h o n ea a n du u ltr alolo wc c o s tGG S M p p h o n e . EE n te rmm a s smm ak k e t/e ea a il o ulele ts . y e in g f s s t a r rk t it it lig tw e ig h t D M A h o n e n d ltr a w ost S M hone. n te r ass a r r e t/ r r t t il o u t t ts . E v e n t u a lly e x it t h e a n a lo g p h o n e m a r k e t . E v e n t u a lly e x it t h e a n a lo g p h o n e m a r k e t .

PP oo d u c t&& TT e c h n o lo g ySS tr a e e g y : rr d uct e c h n o lo g y tr a t t g y : L e a d i n c e ll p h o n e c o s t a n d w e ig h t ( $ 5 0 / 7 0 g m b y 0 3 ) - A g g r e s s iv e ly r e d u c e c o s t s a n d lo w e r s iz e v ia r e m o v a l o f L e a d i n c e ll p h o n e c o s t a n d w e ig h t ( $ 5 0 / 7 0 g m b y 0 3 ) - A g g r e s s iv e ly r e d u c e c o s t s a n d lo w e r s iz e v ia r e m o v a l o f d is c r e te s , c o n s o lid a tio n o f Ic s , u s e o f s m a lle r , s u r f a c e m o u n t c o m p o n e n ts a n d n e w m a te r ia l d e v e lo p m e n ts ( s u c h a s n e x t d is c r e te s , c o n s o lid a tio n o f Ic s , u s e o f s m a lle r , s u r f a c e m o u n t c o m p o n e n ts a n d n e w m a te r ia l d e v e lo p m e n ts ( s u c h a s n e x t g e n e r a tio n b a tt e r ie s a n d P W B s ) . g e n e r a tio n b a tt e r ie s a n d P W B s ) . L e a d i n d a t a c o n n e c t iv it y b y b e in g fir s t to m a r k e t w ith a n IP b a s e d te le p h o n e u s in g a d v a n c e d e r r o r c o r r e c tio n L e a d i n d a t a c o n n e c t iv it y b y b e in g fir s t to m a r k e t w ith a n IP b a s e d te le p h o n e u s in g a d v a n c e d e r r o r c o r r e c tio n a lg o r ith m s . A c t iv e ly p r o m o te w ir e le s s in te r n e t s t a n d a r d s . a lg o r ith m s . A c t iv e ly p r o m o te w ir e le s s in te r n e t s t a n d a r d s .

T h is is a n e x a m p le o f a r o a d m a p fo r a b u s in e s s p r o d u c in g w ir e le s s h a n d s e t s , d e s ig n e d t o illu s tr a te f o r m a t a n d t h e r o a d m a p p in g p r o c e s s . T h is r o a d m a p h a s b e e n d e v e lo p e d fo r illu s t r a t iv e p u r p o s e s o n ly - - it d o e s n o t r e p r e s e n t a n a c t u a l L u c e n t b u s in e s s .

C o n ta c t s / R o a d m a p O w n e r :
Jane Q . R oadm apper + 4 4 -x x x - x x x - x x x x h a n d le @ lu c e n t. c o m e le c tr o n ic v e r s io n : h tt p : //B U .lu c e n t. c o m / r o a d m a p 9 9 F o r a s s is ta n c e w ith r o a d m a p p in g , c o n t a c t t h e L u c e n t T e c h n o lo g y O f fic e : R ic h A lb r ig h t + 1 9 0 8 -5 8 2 -3 5 8 6 r a lb r ig h t@ lu c e n t .c o m h tt p :// in f o v ie w .lu c e n t.c o m / lu c e n t/ c to

r w u c e n ts ir e le s s in a l u s in e s s o m M n it s . n its ar h ile o ld in g B u s i n e s s S t r a t e g y :GG o o wL L u c e n tsww ir e le s ste r mm in a b b u s in e s sfrfr o m 4 4 M u u n it st o o7 75 5MMu u n itsinin4 4y e e as sww h ileh h o ld in g r te r l t . y r 2 0 % m k t s h a r e b y o ff e r in g s m a lle s t, lig h t e s t p h o n e o n m a r k e t a t a v e r y ,c o m p e titiv e p r ic e . T a r g e t C D M A & G S M s e g m e n ts 2 0 % m k t s h a r e b y o ff e r in g s m a lle s t, lig h t e s t p h o n e o n m a r k e t a t a v e r y ,c o m p e titiv e p r ic e . T a r g e t C D M A & G S M s e g m e n ts b b yb b e in gf ir ir t tt o omm ak e e tww ithlig h h tw e ig h tCC D M Ap p h o n ea a n du u r a alolo wc o o t t G S Mp p h o n e . EE ne e rmm a s smm ak e e t/e ea a il o ulele ts . y e in g f s s t a r r k t ith lig tw e ig h t D M A h o n e n d lt lt r w c ss G S M hone. nt tr ass a r r k t/ r r t t il o u t t ts . E v e n t u a lly e x it t h e a n a lo g p h o n e m a r k e t. E v e n t u a lly e x it t h e a n a lo g p h o n e m a r k e t.

B u s in e s s S tr a te g y :

Links strategy, market, technology

PP oo d u c t&& TT e c h n o lo g ySS r a a e e g y : rr d uct e c h n o lo g y t t r t t g y : L e a d i n c e ll p h o n e c o s t a n d w e i g h t ( $ 5 0 / 7 0 g m b y 0 3 ) - A g g r e s s iv e ly r e d u c e c o s ts a n d lo w e r s iz e v ia r e m o v a l o f L e a d i n c e ll p h o n e c o s t a n d w e ig h t ( $ 5 0 / 7 0 g m b y 0 3 ) - A g g r e s s iv e ly r e d u c e c o s ts a n d lo w e r s iz e v ia r e m o v a l o f d is c r e te s , c o n s o lid a tio n o f Ic s , u s e o f s m a lle r , s u r fa c e m o u n t c o m p o n e n t s a n d n e w m a t e r ia l d e v e lo p m e n ts ( s u c h a s n e x t d is c r e te s , c o n s o lid a tio n o f Ic s , u s e o f s m a lle r , s u r fa c e m o u n t c o m p o n e n t s a n d n e w m a t e r ia l d e v e lo p m e n ts ( s u c h a s n e x t g e n e r a tio n b a tte r ie s a n d P W B s ) . g e n e r a tio n b a tte r ie s a n d P W B s ) . L e a d i n d a t a c o n n e c t iv it y b y b e in g fir s t to m a r k e t w it h a n I P b a s e d te le p h o n e u s in g a d v a n c e d e r r o r c o r r e c t io n L e a d i n d a t a c o n n e c t iv it y b y b e in g fir s t to m a r k e t w it h a n I P b a s e d te le p h o n e u s in g a d v a n c e d e r r o r c o r r e c t io n a lg o r ith m s . A c t iv e ly p r o m o te w ir e le s s in te r n e t s ta n d a r d s . a lg o r ith m s . A c t iv e ly p r o m o te w ir e le s s in te r n e t s ta n d a r d s .

Competitive Impact

Roadmaps Manage Multi-Product Offers Roadmaps are the basis for the technology portfolio

Technology Investment
Disruptive
Potential to change the basis of competition

Soft Radio Monitor

Antenna Integrated ASIC Attack

Differentiating
Product/Process Differentiation

Power Supply Radio Battery Defend

Widespread and Shared

Base

Voice Coder

LCD Display Acquire Partner Develop

Technology Source
13 2002 The Albright Strategy Group, LLC

Some Learnings from Roadmapping Experience

On Roadmaps Product-Technology Roadmaps. Linked (strategy to product to technology) roadmaps, not parallel marketing and technology roadmaps -- with increasing emphasis on strategy front end. Focus on the 2 - 3 most important drivers, technologies and investments/actions. Extend to joint roadmaps with customers and suppliers On Roadmapping The product manager (with P&L) owns and drives. A strong leader makes or breaks. Resource: Cross functional team. MATI (Management of Accelerated Technology A facilitator is important. Innovation): Best practices Use the roadmap to guide the journey. in Technology Management. http://mati.ncms.org Renewing the roadmap: Buy em lunch!
14 2002 The Albright Strategy Group, LLC

Why Roadmap?
Roadmapping is just good planning, with a heavy dose of technology (not just an afterthought). Roadmaps link business strategy and market data with product and technology decisions using a series of simple charts. Roadmaps reveal gaps in product and technology plans. Roadmaps prioritize investments based on drivers. Roadmapping helps set better targets: more competitive and more realistic. Sharing roadmaps allows strategic use of technology across product lines. Roadmapping communicates business, technology and product plans to team members, management, customers and suppliers. Roadmaps provide a guide to the team, allowing the team to recognize and act on events that require a change in direction.
15 2002 The Albright Strategy Group, LLC

Summary: Key Points

Portfolio Management as a Process
The key link among strategy, product development, and operational processes. Multiple portfolios of markets, offers, products/platforms, and technologies.

Roadmaps and Roadmapping

Help product teams link business strategy, product plans, and technology development. Enable clear communication with customers and suppliers, and serve as a guide for the team.

Roadmaps and Portfolio Management

Roadmaps clarify the unknown future and provide information for intelligent decisions Roadmaps help manage offer, product and technology portfolios Roadmapping and Portfolio Management are continuing, cyclical processes.

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2002 The Albright Strategy Group, LLC

Summary: Discipline & Focus Learning & Communications

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2002 The Albright Strategy Group, LLC