There’s no central brain trust at Executive Risk. Product ideas spring from sources inside and outside the company. “It’s everyone’s responsibility to look for new opportunities,” declares CEO Stephen Sills.
But creative commotion requires some discipline. In 1997, Sills felt the need to deploy a system to identify and develop ideas. He also realized that if the new system became too cumbersome, it would discourage innovation. He asked Pat Caudill, 42, manager of underwriting operations, to design a best-of-both-worlds framework.
Phase I: of the framework involves outlining a new product: Is this an underserved market? Do we see a loose brick here?
Phase II: requires a more detailed cost-benefit analysis, in which the idea’s promoter sets performance goals for the product.
Phase III: corresponds to the development and implementation of the idea. The maximum time frame for these three phases is 90 days, with go/no-go decisions taking place between each phase.
Phase IV: kicks in once a product is on the market. The people in charge of it look at its impact on the company’s business: Is this running as smoothly as predicted, or are there issues we need to resolve?
Phase V: begins at the six- to nine-month mark, when members of the product team review their original assumptions: Is the new product generating the profits we expected? Does the pricing seem right? How has the market reacted?