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Product • precise description of what the product

has to do.
Product • Customer needs are generally expressed
in the “language of the customer.”
– is something sold by an enterprise to its
customers. Some firms use the terms below to refer to key
design variables of the product
Product development

– set of activities beginning with the • product requirements or engineering

perception of a market opportunity characteristics
– ending in the production, sale, and • specifications or technical
delivery of a product. specifications

Characteristics of Successful Product A specification (singular) consists of a metric

Development and a value.

For example, “average time to assemble” is a

From the perspective of the investors in a for-
profit enterprise successful product metric, while “less than 75 seconds” is the value
development results in products that can be
produced and sold profitably, yet profitability is
often difficult to assess quickly and directly.

• Product quality - market share and

price willing to pay
• Product cost - determines how much
profit
• Development Time - firm’s
responsiveness and econ. return
• Development Cost - fraction of
investment
• Development Capability -future
improvements of this metric.
Duration and Cost of Product Development Process of establishing the target
specifications

1. Prepare the list of metrics.

2. Collect competitive benchmarking
information.
3. Set ideal and marginally acceptable
target values.
4. Reflect on the results and the
process.

Challenges of Product Development:

• Trade-offs – opportunity cost

• Dynamics – changes
• Details – choices
• Time pressure – decision making
• Economics – reasonable ROI

Product Specifications

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Sample Metrics Product Development Process (Generic)

• Product-centered
• Information-Processing System
• Risk Management System

0 – Planning

• This phase begins with opportunity

identification

• guided by corporate strategy and includes

assessment of technology developments
and market objectives.

• Output: Project Mission Statement -

specifies the target market for the product,
Needs- Metrics Matrix business goals, key assumptions, and
constraints.

1 – Concept Development

• the needs of the target market are

identified, alternative product concepts are
generated and evaluated, and one or
more concepts are selected for further
development and testing

• Output: Concept - description of the form,

function, and features of a product and is
usually accompanied by a set of
specifications, an analysis of competitive
products, and an economic justification of
the project.
Development Process
2 – System-level Design
Process
• the definition of the product architecture,
– is a sequence of steps that transforms a decomposition of the product into
set of inputs into a set of outputs. subsystems and components, preliminary
design of key components, and allocation of
Product development process
detail design responsibility to both internal
– is the sequence of steps or activities and external resources.
that an enterprise employs to
• Output: Geometric layout of the
conceive, design, and commercialize a
product, a functional specification of
product.
each of the product’s subsystems, and a
A well-defined development process is useful preliminary process flow diagram for the
for the following reasons: final assembly process

• Quality Assurance - phases & checkpoints 3 – Detail Design

• Coordination - roles & delegations
• complete specification of the geometry,
• Planning - schedule
materials, and tolerances of all of the
• Management - benchmarking
unique parts in the product and the
performance
identification of all of the standard parts to
• Improvement - documentation & review

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 TECHNO I Midterms )
be purchased from suppliers; a process plan
is also established
• Output: Control Documentation for the
product - the drawings or computer files
describing the geometry of each part
and its production tooling, the
specifications of the purchased parts, and
the process plans for the fabrication and
assembly of the product
4 – Testing and Refinement
• the construction and evaluation of multiple
preproduction versions of the product
• Output: Prototype (Alpha and Beta) of
the product – Alpha prototypes are tested
to determine whether the product will work
as designed and whether the product
satisfies the key customer needs, while
beta prototypes is usually created to
answer questions about performance and
reliability to identify necessary engineering
changes for the final product.
5 – Production Ramp-up
• the purpose of the ramp-up is to train the
workforce and to work out any remaining
problems in the production processes.
• Output: Postlaunch Project Review -
includes an assessment of the project from
both commercial and technical perspectives
and is intended to identify ways to improve
the development process for future
projects.
Product Development Process Flows
Prototyping
– Product development almost always
requires the building and testing of
prototypes.
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Prototype
– an approximation of the product on one or
more dimensions of interest.
Prototypes two dimensions:
(1) the degree to which they are physical
as opposed to analytical and
(2) the degree to which they are
comprehensive as opposed to focused.
Prototypes are used for learning,
communication, integration, and milestones.
While all types of prototypes can be used for all
of these purposes :
• Physical prototypes are usually best
for communication
• Comprehensive prototypes are best for
integration and milestones.
Prototyping Principles
• Analytical prototypes are generally more
flexible than physical prototypes.
• Physical prototypes are required to detect
unanticipated phenomena.
• A prototype may reduce the risk of costly
iterations.
• A prototype may expedite other
development steps.
• A prototype may restructure task
dependencies.
Prototyping Steps
four-step method for planning a prototype is:
1. Define the purpose of the prototype.
2. Establish the level of approximation of
the prototype.
3. Outlinean experimental plan.
4. Create a schedule for procurement,
construction, and testing.
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Financial Plan and Resource Generation
Cost Estimation
Cost estimation and budgeting
– allows businesses to make informed
decisions about whether or not to proceed
with a given project.
– If the estimated cost of a project
exceeds the available budget, the business
may decide to scale back the scope of the
project or even cancel it entirely.
– If the estimated cost of a project is lower
than the available budget, the business
may choose to invest additional resources
in order to increase the likelihood of
success.
Key Elements of
Cost Estimation
• Materials
• Labor
• Overhead
• Equipment
• Permits
• Fees
• Taxes
• Contingencies
Methods of Cost Estimation
• Bottom-up estimating
estimating the cost of each individual
component of a project and then
summing those estimates to get a total
project cost estimate.
• Top-down estimating
estimating the total cost of a project and
then allocating that cost to individual
components based on some rational
basis.
• Three-point estimating
estimating the most likely cost, the best-
case cost, and the worst-case cost of a
project.
• Analogous estimating
estimating the cost of a new project by
comparing it to similar projects that
have been completed in the past.
Breakeven Analysis
effort of comparing income from sales
to the fixed costs of doing business.
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• seeks to identify how much in sales will
be required to cover all fixed costs so that
the business can begin generating a profit.
• leads to calculating and examining the
margin of safety for an entity based on
the revenues collected and associated
costs.
• A demand-side analysis would give a seller
significant insight into selling capabilities.
• Unit Contribution Margin
= Sales Price – Variable Costs
• Break-even quantity
= Fixed costs / (Sales price per unit –
Variable cost per unit)
Break-even analysis example:
• Beth has dreams of opening a gourmet
cupcake store. She does a break-even
analysis to determine how many cupcakes
she’ll have to sell to break even on her
investment. She’s done the math, so she
knows her fixed costs for one year are
$10,000 and her variable cost per unit is
$.50. She’s done a competitor study and
some other calculations and determined her
unit price to be $6.00.
Payback Period
• length of time it takes to recover the
cost of an investment or the length of
time an investor needs to reach a
breakeven point.
Shorter paybacks mean more attractive
investments, while longer payback periods are
less desirable.
• calculated by dividing the amount of the
investment by the annual cash flow
• Account and fund managers use the
payback period to determine whether
to go through with an investment.
• One of the downsides of the
payback period is that it disregards
the time value of money.
Financial Planning
– comprehensive overview of your
financial goals and the steps you need
to take to achieve them.
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– process of estimating the capital
required and determining the its
competition. It is the process of framing
financial polices in relation to
procurement, investment and
administration of funds of an
enterprise.
Financial plan
– gives a clear vision of the overall
operating income and expenses of
the business to distinguish
– if the company will gain profit and will
be successful in the business world.
Objectives of Financial Planning
• Determining capital requirements
–depend upon factors like cost of
current and fixed assets, promotional
expenses and long-range planning.
• Determining capital structure
– the capital structure is the
composition of the capital, i.e., the
relative kind and proportion of capital
required in the business.
• Framing financial policies
– with regards to cash control, lending,
borrowing etc.
A finance manager ensures that the scarce
financial resources are maximally utilized int eh
best possible manner at least cost in order to get
maximum returns on investment.
Importance of Financial Planning
1. Adequate funds have to ensured.
2. Financial planning helps in ensuring
a reasonable balance between
outflow and inflow of funds so that
stability is maintained.
3. Financial Planning ensures that the
suppliers of the funds are easily
investing in companies which
exercise financial planning.
4. Financial planning helps in making
growth and expansion programs
which exercise financial planning.
5. Financial planning reduces
uncertainties which regards to
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changing market trends which can
be faced easily through enough
funds.
6. Financial planning helps in reducing
the uncertainties which can be a
hindrance to growth of the
company.
Types of Investors
Angel investors
– are individuals willing to make high-risk
investment in early stage ventures.
Public funding agencies
– mandate and authority to fund business
ventures to achieve economic
development, environmental , cultural,
and etc.
Venture capital companies
– invest in high-risk ventures that offer
potentially high returns.
– VCs raise funds to capitalize investment
funds that they managed.
Private equity (PE) firms
– in relatively mature ventures that
have at least a modest
financial or operational track record
– while offering relatively attractive
terms in an immediate time frame.
Strategic investors
– investment intentions more that
any other factors.
– could be a member of any of the
previous types of investors
– often they are larger companies
operating or investing in the same
industry or a complementary one or
market as your venture.
Banks
– reached financial nirvana, as bank offer
the lowest cost of capital,
Other Options to Raise Capital
1. Funding your own idea.
2. Crowdfunding
3. Friends and Family
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4. Taking a Loan
5. Enter Competitions
Intellectual Property Rights
REPUBLIC ACT NO. 8293
An Act Prescribing the Intellectual Property
Code and Establishing the Intellectual Property
Office, Providing For Its Powers and Functions,
and for other Purposes.
Lays down the rules and regulations that grant,
and enforce patents in the Philippines
Intellectual Property (IP)
– refers to creation of the mind, such as
inventions, literary and artistic works
designs; and symbols, names and
images used in commerce.
• IP is protected in law by,
for example, patents, copyright and
trademarks, which enable people to
earn recognition or financial benefit
from what they invent or create.
• By the striking the right balance
between the interest of innovators and
the wider public interest, the IP aims to
foster an environment in which
creativity and innovation can flourish
Types of IP:
Copyright or Author’s Right
– Is a legal term used to describe the
rights that creators have over their
literary and artistic works.
– Works covered by copyright range from
books, music, paintings, sculpture and
films, to computer programs, databases,
advertisements, maps, and technical
drawings.
Copyright
– as a person’s exclusive right to
reproduce, publish, or sell his or her
original work of authorship as a
literary, musical, dramatic, artistic,
or architectural work.
The primary goal of copyright law :
is to protect the time, effort, and creativity of
the work’s creator.
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Copyright Act
– gives the copyright owner certain
exclusive rights
including the right to:
• Reproduce the work
• Prepare “derivative works” (other works
based on the original work)
• Distribute copies of the work by sale,
lease, or other transfer of
• ownership
• Perform the work publicly
• Display the work publicly
One need to fill out an application form attach a
copy of their work, and pay the basic filling fee
of Php 625 at the IPO.
Types of IP:
Patents
• A patent is an exclusive right granted
for an invention, which a product or
a process that provides, in general, a
new way of doing something, or offers
a new technical solution to a problem.
To get patent, technical information
abut the invention must be disclosed to
the public in a patent application
Types:
• Utility patents – cover anyone who
invents a new and useful process,
article of manufacture, machine, or a
composition of matter.
• Design patents – include an original,
new, and
ornamental design for a manufactured product.
• Plant patents – go to anyone who
produces, discovers, and invents a new
kind of plant capable of reproduction.
Patents Application:
1. One need to fill out a Request Form for a
Grant of Philippine Patent, as well as
submit descriptions and drawings of the
invention or process.
2. Once the application has been filed, it
will be published in the IPO Gazette.
During the period of its publication,
anyone can write in or contest the
application.
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3. Corresponding filing fees amount to Php – If you don’t register your trademarks, you
3,600 and Php 1,800 for big and small may be prohibited from using it by
inventions, respectively someone who has.

Content of Description: Trademark

– is a corporate symbol that contributes

to the image of the company is trying to
build.
– mark of quality and excellence that
identifies that the company as the
manufacturer.
– Like a logo, a trademark can be a
combination of color, typestyle, and
shape, or it can be just shape and color
Examples: like McDonald’s golden arches.

Types of IP : TRADEMARKS

• Trademarks
– identify products
• Service marks
– promote a service
• Collective marks
– are used organizations or
Types of IP: associations to identify themselves
• Certification marks:
Trade Secrets – such as UL (Underwriters
– any practice or process of a company Laboratory)
that is generally not known outside of – used to certify that a particular
the company. product has met the manufacturing
standards of an important third-
– Information considered a trade secrets party regulatory group.
gives the company an economic • Industrial Designs
advantage over its competition and is – refers to the ornamental or aesthetic
often a product of internal research and aspects of an article.
development. – A design may consist of 3-D features,
– defined differently based on jurisdiction such as the shape or surface of an
article, or 2-D features such as patterns,
lines or color.
• Industrial designs are applied
but all have the ff. characteristics in common:
to a wide variety of
• They are not public information industrial products and handicrafts.
• Their secrecy provides economic benefit • The maximum duration of design
to their holder protection varies from country to
• Their secrecy is actively protected • country from 5 to 25 years.

Trademarks Design are concerned with the features, the

appearance of part or the whole product:
Trademarks/ Servicemarks
• Two-dimension features
– to distinguish them in the marketplace
– patterns, lines and/or color
– a value marketing tool, in some
• Three-dimensional features
circumstances.
– shape, texture and/or surface of
– prevents another person from offering a
an article are protectable
similar product or services confusingly
similar to yours.

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 TECHNO I Midterms )

– by design right if they are not
dedicated by functional
considerations.
Business Plan and Elevator Pitch
The Executive summary should address these
main points:
• Purpose – Make sure you have a
purpose when writing the summary

Business plan • Problem – What issue needs

– is a document that summarizes the
operational and financial objectives
of a business
– contains the detailed plans and
budgets showing how the objectives
are to be realized.
– It is the road map to the success of
your business .
– serve as a guide on what to do and it
will give a clear outline of the things
that need to be done.
addressing? Why is it an issue? Why are
you where you are?
• Problem Analysis – What can be
changed or improved?
• Results of Analysis –How do you know
your resources are valid, reliable, and
credible?
• Recommendations – What can you do
to address the issue? How will you
achieve your recommendations?

Importance of Business Plan • Company Description

A technopreneur should be involved in – company overview that includes

making the business plan because he or she
knows the content of the business proposal and
it explain it thoroughly to the audience.
Four Reasons Why You Need a Business Plan
1. To raise money for your business
2. To make sound decisions
3. To help you identify the potential
weaknesses
4. To communicate your ideas with
stakeholders
Benefits of a Business Plan
the history, mission statement,
vision goals, objectives, products
or services, management team,
organizational structure, and
location of the company or the
organization.
– significant to the business plan as
it provides the clients or
customers with the company’s
stability and credibility.
Product or Service - Your product and services
section should include:

1. See the whole business • A description of the products or

2. Strategic focus services you are offering or plan to
3. Set priorities offer
4. Manage change • How your products and services will
5. Develop accountability be priced
6. Manage cash • A comparison of the products or
7. Strategic alignment services your competitors offer
8. Milestones concerning yours
9. Metrics • Sales literature you plan to use,
10. Realistic regular reminders to keep on including information about your
tract marketing collateral materials and
the role your website, will play in
Business Plan Outline your sales efforts
Executive Summary • A paragraph or so on how orders
from your customers will be
– decision-makers will determine if processed or fulfilled
action is warranted on a particular • Any need you have to create or
action or idea. analyze a problem, draw deliver your products, such as up-
conclusions, to- date computer equipment
– recommend a complete but brief
synopsis course of action.

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 TECHNO I Midterms )
• Any intellectual property (i.e.,
paten) or legal issues you need to
address
• Future products or service you plan
to offer
Market Analysis
– to know the market and customer needs.
– through surveys and interviews to know
the market trends and what the
customer needs for their daily activities.
– quantitative and qualitative assessment
of a market.
– Present your Iachibuchi framework or
SOSTAC framework and discuss here
comprehensively
– (Includes all the analysis tools such as
SWOT analysis or TOWS analysis and
others).
Strategy and Implementation
– A company should create its strategic
plan in a maximum span of t years to 10
years.
Implementation
– provide the company with ideas and
serve as a guide in achieving its goals
and objectives through
Strategy implementation
– is the translation of chosen strategy into
organizational action so to achieve
strategic goals and objectives.
– is also defined as how an organization
should develop, utilize, and
amalgamate organizational structure,
control system, and culture to follow
strategies that lead to competitive
advantage and better performance.
Management Team
– composed of the team members,
their strategies, and information.
– It is a group of individuals who
operate the organization.
– They have a day-to-day
responsibility in managing
different individuals and
maintaining their responsibility in
the business.
– ensures that the business strategy
and objectives are met because
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they will be liable to the company's
board of directors or top managers.
Financial Plan
• Cost Structure: List out all your fixed
and variable costs.
• Revenue Streams: Identify your
revenue model – subscription, ads,
freemium, etc. and outline your back-
of-the -envelop assumptions for
lifetime value, gross margin, break-even
point, etc.
Recommendations References
The Lean Canvas
– an adaption of the business model
canvas by Alexander Osterwalder,
– which adds a layer to the traditional
business model canvas that focuses on
problems, solutions, key metrics and
unfair advantage based on a unique
value proposition.
– Ash Maurya found the business model
canvas a bit too general for a lean
startup that is why he revised the key
partners, key activities, key resources,
and customer relationships and
substituted it with a problem,
solution, unfair advantage, and key
metrics, respectively.
The Lean Canvas
1. Problem
– A brief description of the top 3
problems you’re addressing in the
market. If there is a problem then
its is time to fine a probable
solution.
2. Customer Segments
– Who are the customers/users of
this system?
– can be done through market
analysis
– knowing your target customer is
like knowing what products or
services are suitable to that
location.
3. Unique Value Proposition
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– What is the product’s tagline or 5-Steps Elevator Pitch

primary reason you are different
1. Introduce your self. Start the
and worth buying?
elevator pitch with a brief easy-to
– What is the real essence of creating,
absorb sentence that includes your
making or developing a product?
name, your company name and the
4. Solution service you provide.

– What is the minimum feature set
(MVP) that demonstrate the UVP
up above?
– Based on the problem that has been
analyze then you will be able to
know the exact solution to help not
just your client but the society at
large.
5. Key Activity
– Describe the key action users take
that maps to revenue or retention?
6. Channels
2. Identify the problem your company
solves. What should the person care
what you do?
3. Announce your promise. What
product or service will provide the
client? Be clear on the results the
person can expect, but avoid selling.
4. Offer proof and a plan. How have you
delivered on your promises prior this?
5. Know when to stop and listen. If any
point in your pitch you find that the
listener is turning out, stop talking.

– List the FREE and PAID channels you
can use to reach your customer.
– Channels that could boost up the
products and services customer will
have an idea and be informed about
it.
7. Cost Structure:
– List out all your fixed and variable costs.
8. Revenue Streams:
– Identify your revenue model
– subscription, ads, freemium, etc.
– and outline your back-of-the envelop
assumptions for life time value, gross
margin, break- even point etc.
9. Unfair Advantage. Anything that is worth
copying will be copied.
Three Essential Components in a Pitch
1. Stimulate interest. Keep in mind that
people generally buy based on
emotion, using logical reasons as their
impetus for action. Make a point t
connect with them emotionally in order
to stimulate their interest.
2. Transition that interest. Making a
genuine connection can help you
transition interest. Learn to make your
self equal, then make yourself different.
3. Share a vision. Make the value that you
bring the table as clear as
possible. Tell others exactly what you
want it and what you’re willing to
give in return.
Elevator Pitch Final Tips

Elevator Pitch 1. Take your time

• quick presentation which can be deliver 2. Make it conversational

on the fly.
3. Avoid niche words and phrases
• concise that you can even pitch your
4. Express confidence
ideas before someone during an
elevator ride.

• This type of pitch is usually not more

than 30 seconds, or 2 minutes long.

• main focus of the formers to save time

and try to convince a potential lead
within a short period of time.

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