Weve Got Rhythm!

Medtronic Corporation
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Presented By, DIVYA & SUJITH

Medtronic Corporation

Medtronic was founded in 1957 in Minneapolis. Cardiac Pacemaker major invention Pacemakers for 2 disorders: v Bradycardia- For not enough pulses v Tachycardia- For too many pulses

WHY they LOST RHYTHM ??

Key Issues Faced by Medtronic

Lack of coordination within functional units Every idea generated was put into action even

before completing the previous project. No project got focus and attention needed to get it done right Marketing and Production were out of sync. Competitors introduced new improvements Lengthy product development cycle

Key Issues Faced by Medtronic

2 major product recalls related to quality problems Employee attrition they develop pacemaker

product ideas in new start ups . Market share dropped from 70% in 1970 to 29% in 1986

Breakthrough for Medtronic

Rate responsive pacemaker Activitrax

How it become success??

v v v

Single chamber design was easy to be implanted Good response from the users Serious product recall by a competitor

How they GOT BACK RHYTHM ??

Processes Introduced by Stevens

Speed Platform Strategy Project Documentation Phase Definition Rhythm Market Inputs

Speed
Formulated well-defined strategy Assessment of environment and technology

To define the business objectives To estimate the financial and competitive contributions of the new product

Platform Strategy
Ideas from disparate parts being funded

independently Not enhancing any product with derivative lack of effective product line
For overcoming this product planning team

First Element
1) Initial product Top end model

Derivatives models with lesser features

Second Element
Perfected the design and implementation in single

chamber platform

The features were enhanced for dual chamber platform Clearly defined the product line and target market

Simple devices for the low end of the market and high

performance fully featured models at the high end.

Leadership role in higher end of market via functionality and features Strengthened the position in lower end with low priced products

Third Element
Changed the way platform has been designed Physical architecture Hybrid circuit Latest tech could be incorporated in hybrid circuits MicroRel Outsource only those parts that are standardized Decision making by project managers instead of

functional heads.

Project Documentation
Lack of synchronization between marketing and production

dept

How the problem was solved. ??

q

Two Documents need to be prepared 1. Product Description Marketing 2. Product Specification Engineering

Product Description

Customer Requirements Product Definition Performance Expectations of the product To be signed off by engineering

Product Specification

Technical and Cost specifications To be signed off by marketing

Phase Definition
Business Analysis Phase Product description is written and financial benefits is estimated Demonstration Phase Technological feasibility of the project is estimated Rapid prot0typing is emphasized Commitment Review Review of technological potential, competitive activity, profits and ROI Commitment/Development Phase

Rhythm

Scheduled a date each month for phase review

Prepared a schedule on new product launches Structured the way new ideas were being handled

Market Inputs
For getting inputs from customers

Physician review board. Physician Inputs on performance of existing models Suggestions on new features Review boards will meet twice every year

PROCESS OUTCOME

RESULTS
Market share increased from 29% in 1986 to 51% in

1996. Time required to develop new platform products was reduced by 75 % Become Market leaders in every segment of the market.

FUTURE CHALLENGES

Challenges in Future
How to satisfy the already satisfied customer?

Figure out how to add values in different ways Need to define the product generations Price of the pacemaker need to be reduced significantly Reaching less developed regions Require advanced technology and enormous efforts from physician

Increasing the reach of dual chamber platforms from

50% to 70% Work closely with customers :- patients, surgeons, hospital management and buying groups

Learnings
How a new management team at Medtronic's Cardiac

Pacemaker business reversed a steep decline in market share . By 1) Clarifying current strategy 2) By proper project planning 3) Better Customer understanding