Overview of Technology / Product Function / Markets Matrices

One of the most powerful technology planning tools is shown in the “Overview of Technology / Product Function / Markets Matrices” figure. This matrix is comprised of technology, product function, and market segments.

This matrix is a good tool for a company to use when understanding where its competency leverage points are. Listed in the columns of the left-hand matrix are the different Technologies that a company has. The rows down the center of the two adjoining matrices are filled in with the Product Functions that the Technologies or Competencies create. The columns of the right-hand matrix are labeled with the industry segments that utilize these Product Functions. These paired matrices were a significant improvement over the previous method of simply listing technologies vs. markets in a single matrix. This two matrix planning tool allows for planners to visualize new markets where technologies may be developed or licensed for additional business (via the Product Function coupling).

Technology / Product Function / Market Matrix (left half)

To explain this planning tool further, the “Technology / Product Function / Market Matrix (left half)” figure shows an example for one company their relevant Technologies and Product Functions. The order of the technologies is set according to their position in the value chain. In this example we see first the materials portion of the value chain, flowing into the manufacturing or fabrication methods. These are followed by the converting and printing operations. Lastly are the packaging systems at the end of the value chain.

The far left columns relate to the scientific disciplines or research infrastructure that are associated with underpinning the other technologies. In this example under technology infrastructure we see computer modeling, polymer characterization, databases and others.

Technology / Product Function / Market Matrix (right half)

The rows down the center of both matrices relate to the “Product Functions”. This concept was developed to BCG and Pugh Roberts Associates several decades ago. The power of “Product Functions” remains useful today, especially for larger corporations. Product Functions link technologies and markets together in a way that facilitates strategic planning. Product Functions are associated with the benefits a consumer or customer receives. Product Functions are best organized by Consumer Benefits as shown in the “Technology / Product Function / Market Matrix (right half)” figure. The “x’s” in the matrix elements indicate which Technologies can be used to create which Product Functions.

In this example matrix the Benefits shown are those related to green packaging issues, the convenience of the packaging, health concerns, aesthetics, packaging efficiency, serviceability of the product, and product quality. Specific Product Function features in each of these areas are shown as RCP levers or Product Features in the “Technology / Product Function / Market Matrix (right half)” figure. These are attributes that can usually be determined by market research or quality assurance investigations. As one example, in the case of the customer benefit being packaging efficiency the corresponding Product Functions are listed as surface friction, sealing temperature, and mechanical stiffness and strength.

The right-hand matrix of this tool ties consumer benefits to the different market segments that a company will serve. In this example, for consumer and food packaging, one sees these areas are snack products, cereal, candy, coffee, etc. The “x’s” in the matrix elements again indicate which Product Functions are of value in which Market Segments.

Shown by axes in this part of the figure which of these attributes are most important to a specific industry segment. Some models ask that the presence of the “x’s” be rank ordered on anchored skills of 1-5 or 1-10 gradients. It’s often found that it’s easier to just put in a place-holder “x” based on a simple determination of subject matter experts’ viewpoint, on whether or not it is an important interaction or not. Later for those areas initially showing the best opportunities, they can be refined from “x’s” to anchored scale values using quality functional deployment methodology (detailed below).

There are times when it is advantageous to really look at key customer accounts in each industry segment as shown in the upper right-hand matrix in the “Technology / Product Function / Market Matrix (right half)” figure. This becomes especially important if there are customers holding intellectual property rights which might impact if the consumer benefits can be offered exclusively or non-exclusively to particular group.

Tying this matrix back to the previous discussion of core competencies one can now see at a glance on one page how the core competencies from a technical standpoint tie to the marketing and sales competencies on the right-hand side. The matrix also allows the human eye to spot areas of leverage and areas where gaps need to be filled. Color coding the technology strategies (for either new programs or existing programs) associated with specific marketing and business strategies (for new business or existing business) again allows at a glance to see points of synergy and leverage.