This Corporate Procedure (“Procedure”) shall be followed by Nortel Networks Corporation (“NNC”) and its subsidiaries and other controlled businesses globally, whether incorporated or unincorporated (collectively, “Nortel”).
1.0 Purpose
The purpose of this Procedure is to provide the operating requirements and functional responsibilities necessary to ensure the maximum effective use of process discipline for Product Life Cycle Management. This Procedure serves as a key element for implementation of Corporate Policy 700.02 – Product Design and Life Cycle Management.
2.0 Interpretation
The General Manager(s) of each applicable Product portfolio are responsible for implementing this Procedure in a consistent manner that fits the needs of their business and adheres to Corporate Policy 500.04 – Quality and Customer Satisfaction.
3.0 Definitions
- “Business Decision Point” is an event driven evaluation used to set common expectations on market-based goals, evaluate market performance, consider/ analyze Risks, make decisions on project/Product content, direction, quality, funding, schedule, and resource levels, and empower the project team to execute project plans in accordance with the Nortel Corporate Policies, Procedures and Standards.
- “Core Strategic Vision” articulates market and customer focus, Product and Solution focus, life cycle management considerations, and requisites for business success.
- “Corporate Policy” is a Nortel statement of a governing principle.
- “Corporate Procedure” is a Nortel document governing the implementation of a Corporate Policy and related processes.
- “Corporate Standard” is a Nortel document used to define the requirements necessary to meet industry standards and specific Nortel requirements. Corporate Standards shall be adhered to by Nortel, and where applicable, by suppliers, contractors and sub-contractors (see Corporate Policy 500.16 – Corporate Standards).
- “DCA” means Delivery Customer Assurance and is a process used to drive the delivery of Products and services to meet or exceed the customer’s expectations and to preserve margins.
- “Executive Investment Council” is a term used to describe the Nortel executive team that sets the vision, mission, strategy, and Product roadmap for portfolio investments, execution, and business results.
- “Intellectual Property Review” means review by a member of the IPT together with a member of the Intellectual Property Law Group to identify any patentable inventions associated with the project and to ensure that any appropriate invention disclosure submissions have been made to the Intellectual Property Law Group.
- “IPT” means Integrated Project Team and is a term used to describe a cross-functional team, chaired by a team leader, who is accountable for the success of the
project to meet customer/business needs, developing/implementing portfolio project plans, and is accountable to the Portfolio Management Team throughout the duration of the project. - “NPI” means New Product Introduction and is the interval during which all ideas through deployment phase activities are managed and completed for the design, test, and delivery of a Product or Solution to all intended markets.
- “Operational Support Processes” includes processes for any or all of the following
functions: order, configure, procure, manufacture, integrate, and test; move, install, train, repair, and technical support. - “Out-of-Bounds” means that the project parameters as originally defined will have a significant variance and potentially alter or impact the intended project outcome.
- “Portfolio Management Team” is a decision making team, chaired by the portfolio lead (i.e. General Manager or delegate), which is accountable for portfolio strategy,
resource allocation, and ongoing portfolio management/ decisions relative to market timing, customer need, and business priorities. This appropriate cross-functional team is accountable for the performance of all Products within the portfolio and to
ensure those Products are supported by an accountable IPT leader or Product owner. - “Product” is a term used to describe a single offering of hardware, software, documentation, services or any combination thereof.
- “Product Life Cycle Management” is a term used to describe all Product introduction,
Production, and Retirement activities. - “Production” is the interval during which all Production phase activities are managed and completed to meet delivery commitments, achieve return on investment, support/improve quality and performance, and meet/exceed targeted levels of customer satisfaction.
- “Retirement” is the interval during which all Retirement phase activities are managed and completed to stop Production, provide continued service and maintenance, and
eventually exit the market. - “Risk” is a term used to describe the possibility of an impact or loss – typically in
the form of diminished Product quality, increased costs, project delays, and/or failure to meet business objectives. - “Risk Management” is a disciplined practice – supported by process, methods, and
tools - used to proactively and continually identify, assess, prioritize, and mitigate Risks critical to project/business success. - “Solution” is a term used to describe a combination of multiple Products – typically from multiple portfolios (internal) and/or vendors (external) – designed to interoperate to satisfy a customer need.
4.0 Responsibility
- 4.1 The General Manager for each Product portfolio shall:
- (a) Establish and hold a Portfolio Management Team accountable for making strategic business decisions that optimize Nortel’s investment in that portfolio.
- (b) Develop and maintain a Core Strategic Vision in conjunction with the Portfolio Management Team – ensure alignment to and execution of the investment strategy and Product roadmap as defined by the Executive Investment Council.
- (c) Clearly distinguish between higher level platforms and single point Products within the portfolio and include other portfolio leaders in platform level business
decisions that may impact their Products, and ensure the required level of interoperability is defined. - (d) As mandated by the executive leadership team, ensure accountability to the responsibilities outlined in this Procedure in support of Corporate Policy 700.02 - Product Design and Life Cycle Management.
- (e) Assume responsibility for achieving targeted levels of customer satisfaction and all aspects of Product performance.
- (f) Establish assurance programs, including regular audits by an independent party, to ensure:
- i. all Products in the portfolio are supported by an appropriately staffed IPT or, as business/Product needs dictate, at least a single, accountable Product owner;
- ii. process discipline is being applied across the entire portfolio through use of
documented life cycle management processes, inclusive of measurement of process effectiveness, root cause analysis, applied best practices, and continual process improvement as a result thereof; - iii. minimum requirements for Business Decision Point content, documentation, approvals,storage, and accessibility must be defined and consistently met;
- iv. Product life cycles are being managed to meet investment and/or business objectives;
- v. Product quality plans and performance targets are defined, progressive, consistently measured, and documented - in the Business Decision Points for each Product - to demonstrate use of documented design and life cycle management processes (reference the phase by phase activities and exit criteria requirements of Corporate Procedure 505.32 - Product/Solution Design and Test);
- vi. customer interaction programs are established to regularly measure customer perceived quality and track the top issues, by account, in collaboration with the key account teams; and
- vii. all aspects of Product design, delivery, safety, maintenance, and potential Product recovery from customers meet applicable legal, contractual, environmental and regulatory requirements - in all applicable global markets - and intellectual property associated with said Product(s) is adequately protected.
- (g) On a regular basis, report findings of assurance programs to Nortel’s executive
leadership team.
- 4.2 The Portfolio Management Team for each portfolio shall:
- (a) Ensure alignment to the Core Strategic Vision.
- (b) Determine if business and/or Product needs justify the formation and continuing support of IPTs for all Products in the portfolio.
- (c) Establish and hold IPTs accountable for Product development, introduction, Production, and/or Retirement to meet market, customer, and/or business needs
- (d) Ensure an accountable team leader is assigned to each IPT.
- (e) Ensure an accountable Product owner is assigned to any Product in the portfolio not supported by an IPT.
- (f) Ensure the maximum effective use of available resources across the entire portfolio.
- (g) Ensure consistent application and measurement of documented Product Life Cycle Management processes (idea through Retirement) and implementation of root cause analysis, best practices, and continuous process improvements as a result thereof.
- (h) Ensure that when a Product introduction cycle is completed, ongoing Product management responsibilities are clearly defined and remain with the same team or transition to another IPT or transition to the Product owner.
- (i) Review the applicable criteria for each business decision in a Product’s life cycle, ensure the minimum Business Decision Point requirements are documented - inclusive of Product quality and performance, give approval to proceed, do not proceed, redirect as appropriate based upon assessment of Risks in achieving business objectives, and ensure the approval of all accountable functional primes is captured and documented.
- (j) Review all Out-of-Bounds conditions, the associated Risk analysis, recommended actions plan, and proceed/do not proceed/redirect as appropriate. General Manager approval required.
- (k) Manufacture discontinue and/or end all projects/Products that do not meet business objectives, are no longer profitable, have been replaced by a better alternative, and/or have reached the end of their intended life. All projects/Product data and information shall be securely stored and labeled in accordance with documented Product Life Cycle Management processes.
- 4.3 The IPT leader or Product owner for each product shall:
- (a) Team Leader - Ensure that an IPT is formed and remains appropriately staffed - including, but not limited to design, delivery, and service representation - to meet all Product Life Cycle Management objectives. Escalate resource issues to the Portfolio Management Team.
- (b) Product Owner - Identify business and/or Product needs to the Portfolio Management Team that justify formation of an IPT.
- (c) Ensure that the documented Product Life Cycle Management process is followed, including root cause analysis and the use of documented best practices. Identify areas for continuous process improvements to the Portfolio Management Team.
- (d) Coordinate, document, and present business decision recommendations to the Portfolio Management Team for each phase in a Product’s life cycle – ensure alignment and successful completion of the applicable design and test phases (reference Corporate Procedure 505.32 – Product/Solution Design and Test).
- (e) Ensure Risk Management practices are continuously and effectively utilized throughout a Product’s life cycle.
- (f) Ensure all known Product applications are identified and the accountable IPT leaders and/or Product owners are informed of decisions that may impact another Product or Solution.
- (g) Identify Out-of-Bounds project/Product conditions. Research and deliver Risk analysis and recommendations to the Portfolio Management Team for approval to proceed/do not proceed/redirect.
- (h) Ensure Portfolio Management Team decisions, as captured and documented for each Business Decision Point, are effectively implemented.
- (i) Ensure all project/Product data is securely stored and labeled in accordance with documented data management processes.
5.0 Process
- 5.1 To achieve a basic level of process consistency, the following phases and key activities shall be included in the supporting Product Life Cycle Management process documentation.
- Phases
- Phase 1 – Idea
- Phase 2 – Opportunity
- Phase 3 – Definition
- Phase 4 –Implementation
- Phase 5 – Deployment
- Phase 6 – Production
- Phase 7 –Retirement
- Primary Phase Objective
- Approve project concept
- Approve Product concept and initial project schedule
- Approve final Product definition and project plan
- Complete Product/process validation and approve formal release of Product
- Approve volume Production and deployment
- Achieve return on investment and approve plan to stop Production
- Execute plan to stop Production. Monitor/support installed base and approve plan to exit the market
- Key Phase Activities--Phase 1
- (a) Identify and scope the market opportunity.
- (b) Develop preliminary Product concept, Solution, and/or alternatives.
- (c) Develop a rough business case and strategic rationale.
- (d) Initial Intellectual Property Review.
- (e) Business Decision Point to assess strategic readiness.
- Key Phase Activities--Phase 2
- (a) Evaluate the global market opportunity and ability to service proposed geographies.
- (b) Confirm strategic fit and assess business capabilities.
- (c) Capture customer and functional requirements (reference Customer Requirements Analysis Phase of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (d) Define system architecture – include administrative and maintenance requirements (reference Design Phase 0 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (e) Identify commercial (sellable Products, models, services, and associated pricing) and operational (order, configure, procure, manufacture, integrate, and test; move, install, train, repair, and technical support) requirements.
- (f) Identify legal, contractual, environmental, and regulatory requirements - give special consideration to security and export controls.
- (g) State the Product concept and project boundaries - include interoperability requirements with other Nortel and 3rd party Products.
- (h) Identify strategy for Product quality, performance, and associated release over release improvements – include in business case.
- (i) Identify strategy for Product/ Solution delivery – see Corporate Procedure 505.33 – Product/ Solution Delivery.
- (j) Identify any Products being replaced.
- (k) Define the business case and plan definition phase needs – include estimated project and R&D costs, resources, capital, Product cost, margins, return on investment targets, and revenue potential.
- (l) Review and consider lessons learned from previous projects/Products.
- (m) Conduct Intellectual Property Review.
- (n) Ensure all conditions are met for customer requirements analysis and completion of Design Phase 0 as outlined in Corporate Procedure 505.32 – Product/Solution Design and Test.
- (o) Business Decision Point to assess market readiness.
- Key Phase Activities--Phase 3
- (a) Clearly define the Product based on global customer needs.
- (b) Clearly define all markets, the rollout strategy, and associated legal, contractual, environmental, and regulatory requirements - give special consideration to security and export controls.
- (c) Capture commercial requirements (sellable Products, models, services, and associated pricing).
- (d) Select Product technology, complete high level design (including strategy for administration, maintenance, environmental compliance, and release over release improvements), and commit to design reliability and delivery (reference Design Phase 1 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (e) Clearly identify interoperability requirements with other Nortel and applicable 3rd party Products.
- (f) Capture operational requirements (order, configure, procure, manufacture, integrate, and test; move, install, train, repair, and technical support).
- (g) Identify intervals for Production and Retirement - ensure contract alignment.
- (h) Identify strategy for Product recovery and recycle.
- (i) Identify the phase out strategy for Products being replaced.
- (j) Establish plan for Product life cycle quality and performance – include consideration of release over release improvements and update business case as required.
- (k) Ensure all customer and functional requirements have been accepted and included in the commitment to design delivery – identify exceptions.
- (l) Fully plan the remainder of the project for NPI - include customer commitments; Product release management requirements (reference Corporate Procedure 505.34 – Product Release Management); commercial/ operational requirements for Product sales, supply, and support; and the associated Product design, test, and delivery schedule (reference Corporate Procedure 505.32 – Product/Solution Design and Test) – identify critical project Risks and Risk Management plan.
- (m) Refine and validate the business case – include updates – as required – to all project and R&D costs, resources, capital, Product cost, margins, return on investment targets, and revenue potential.
- (n) Review and consider lessons learned from previous projects/Products.
- (o) Conduct Intellectual Property Review.
- (p) Ensure all conditions are met for completion of Design Phase 1 as outlined in Corporate Procedure 505.32 – Product/Solution Design and Test.
- (q) Business Decision Point to assess business readiness.
- Key Phase Activities--Phase 4
- (a) Complete hardware and software design and test (reference Design Phase 2 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (b) Complete hardware and software design integration testing (reference Design Phase 3 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (c) Complete Product verification and system validation testing, including large system overload limits and interoperability (reference System Test Phases 1 and 2 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (d) Finalize documentation, ensure alignment to the commercial requirements (sellable Products, models, services, and associated pricing), and formally release the hardware and software design (reference System Test Phase 2 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (e) Develop and/or update the Operational Support Processes – validate through initial implementation and execution thereof.
- (f) Ensure legal, contractual, environmental, regulatory, and export requirements have been satisfied for deployment phase markets and applications.
- (g) Ensure customer and functional requirements have been satisfied for deployment phase markets and applications.
- (h) Prepare plans for Product introduction, deployment, validation, and support in each intended market - consider unique requirements and relationships needed to satisfy key customers.
- (i) Identify and begin execution of the DCA process for any applicable customer order (reference Corporate Procedure 506.01 – Delivery Customer Assurance (“DCA”) Process).
- (j) Update the business case – include updates – as required – to all project and R&D costs, resources, capital, Product cost, margins, return on investment targets, and revenue potential.
- (k) Conduct Intellectual Property Review.
- (l) Ensure all conditions are met for completion of Design Phases 2 and 3 and System Test Phases 1 and 2 as outlined in Corporate Procedure 505.32 – Product/Solution Design and Test.
- (m) Ensure Product vintage and release controls are established.
- (n) Capture and document the parameters for managing the initial Product release – identify critical deployment Risks and Risk Management plan - gain approval and communicate to operational support primes (reference Corporate Procedure 505.34 – Product Release Management).
- (o) Business Decision Point to assess customer readiness.
- Key Phase Activities--Phase 5
- (a) Validate the formally released Product in a live customer environment - ensure that each new feature is validated (test coverage) and the in-service (soak time) target is met (reference System Test Phase 3 of Corporate Procedure 505.32 – Product/Solution Design and Test).
- (b) Ensure the Operational Support Processes can fulfill the commercial requirements (sellable Products, models, services, and associated pricing).
- (c) Update - as needed - and implement the Operational Support Processes for volume Production - ensure consideration for the planned Production phase interval and associated supply/customer contracts.
- (d) Ensure compliance to all applicable export control regulations.
- (e) Ramp up Production to support unique requirements by market.
- (f) Identify and execute the DCA process for any applicable customer order (reference Corporate Procedure 506.01 – Delivery Customer Assurance (“DCA”) Process).
- (g) Maintain Product vintage and release controls – update as needed.
- (h) Ensure changes to previously documented Product release management requirements are captured, approved, and communicated as needed – consider new Product applications, markets, customers, applicable Risks and management thereof (reference Corporate Procedure 505.34 – Product Release Management).
- (i) Finalize training and certification programs - ensure alignment to and validation of engineering rules and associated documentation.
- (j) Ensure legal, contractual, environmental, regulatory, and export requirements have been satisfied for general Product availability.
- (k) Ensure customer and functional requirements have been satisfied for general Product availability.
- (l) Ensure final Product design and quality meet requirements for general availability – validate quality plan and release over release improvements - update plan as needed.
- (m) Identify and assess Risks that may impact Product performance, customer perception, and/or overall business objectives – establish Risk Management plan and include for consideration in the parameters defined and approved for Product release management (reference Corporate Procedure 505.34 – Product Release Management).
- (n) Ensure plans are in place for Product recovery and recycle.
- (o) Ensure the phase out plan is in place for Products being replaced.
- (p) Validate business case – include project cost summary and any updates to targets for Product cost, support cost, margins, return on investment, and life cycle revenue.
- (q) Capture lessons learned and process upgrades.
- (r) Conduct final Intellectual Property Review.
- (s) Ensure all conditions are met for completion of System Test Phase 3 as outlined in Corporate Procedure 505.32 – Product/Solution Design and Test.
- (t) Capture and document Product release management requirements for the Production phase – identify any restrictions specific to Product application, market, and/or customer – gain approval and communicate to operational support primes (reference Corporate Procedure 505.34 – Product Release Management).
- (u) Business Decision Point to assess channel readiness.
- Key Phase Activities--Phase 6
- (a) Transition on-going business management to an accountable team or owner.
- (b) Begin and effectively manage volume Production to meet market demand.
- (c) Identify and execute the DCA process for any applicable customer order (reference Corporate Procedure 506.01 – Delivery Customer Assurance (“DCA”) Process).
- (d) Monitor market performance against the business case (examples include Product reliability, cost performance, market penetration/share, revenue, return on investment, and customer satisfaction).
- (e) Identify any Product offering inconsistent with commercial and/ or design intent (i.e. Out-of- Bounds) – take appropriate action to address/resolve issues and any associated Risks.
- (f) Changes to the previously defined parameters for Product release must be documented, approved, and communicated (reference Corporate Procedure 505.34 – Product Release Management).
- (g) Maintain Product vintage and release controls – update as needed.
- (h) Execute plans for Product recovery and recycle as needed.
- (i) Monitor quality plan - improve Product design, quality, performance, and/or cost as business/customer needs dictate.
- (j) Capture and analyze requirements to stop Production - including legal, contractual, environmental, and regulatory considerations - ensure consideration for the planned Retirement phase interval.
- (k) Establish plan to transition customer to the next generation alternative(s).
- (l) Define business requirements for Retirement phase support – include costs and potential for new and/or continued service revenue.
- (m) Business Decision Point to assess end of life readiness.
- Key Phase Activities--Phase 7
- (a) Execute manufacture discontinue plans and ensure all activities have been completed to inform customers and stop Production.
- (b) Monitor installed base, Product quality, and service performance against the original manufacture discontinue plan.
- (c) Execute plans for Product recovery and recycle as needed.
- (d) Changes to the previously approved parameters for Product release and support (i.e. market and/or application) must be documented, approved, and communicated (reference Corporate Procedure 505.34 – Product Release Management).
- (e) Capture and analyze requirements to stop Product service and support – include business considerations and impact.
- (f) Business Decision Point to end the Product life and all future service and support.
- (g) Communicate with customers and execute market exit plans.
- (h) Archive Intellectual Property.
- (i) Support customers/channels through transition/migration – continue Product recovery/recycle as required.
- Phases
- 5.2 In association with the key phase activities and associated critical path for completion of each phase, Business Decision Point dates shall be established, captured, and tracked as a plan of record for Product Life Cycle Management.
Performance to these dates – specifically the Customer and Channel Readiness Business Decision Points - shall be consistently reported as a key measure of process effectiveness and continuous improvement. BDP data capture, updates, and overall plan of record performance shall be the responsibility of the IPT Leader and/or Product Owner. - 5.3 Utilization of this Procedure in conjunction with aforementioned documented process requirements and the referenced documents listed below will be considered the “Nortel Product Life Cycle Model” as required by customer requirements, ISO 9001 and TL 9000.
6.0 Approvals
In addition to the Senior Executives listed on the title page of this Procedure, Senior Executives of the following operating entities have also approved and agreed to adopt this Procedure for implementation across the Product portfolios for which they are accountable:
- President – Carrier Networks
- President – Enterprise Networks
7.0 Reference Documents
- Corporate Policy 100.05 – Direct Government Financial Assistance
- Corporate Policy 100.07 – Federal Government Relations
- Corporate Policy 100.22 – Disclosure of Material Information
- Corporate Policy 200.05 – Corporate and Systems Security
- Corporate Policy 200.17 – Collection and Retention of Competitive Information
- Corporate Policy 200.18 – Intellectual Property Protection
- Corporate Policy 300.01 – Risk Management
- Corporate Policy 400.02 – Handling Unsolicited Disclosure of Ideas from Third Parties
- Corporate Policy 400.03 – Protection of Proprietary Software
- Corporate Policy 400.04 – Export Control and Trade Compliance
- Corporate Policy 400.06 – External Publication of Technology Information
- Corporate Policy 500.04 - Quality and Customer Satisfaction
- Corporate Policy 500.16 – Corporate Standards
- Corporate Policy 500.17 – Protection and Enhancement of the Environment
- Corporate Policy 500.22 – Acquisition of Goods and Services
- Corporate Policy 500.25 – Sales and Delivery Life Cycle Margin Preservation and Customer Delivery Assurance
- Corporate Policy 700.01 – Research and Development Investment
- Corporate Policy 700.02 – Product Design and Life Cycle Management
- Corporate Procedure 205.04 – Protection of Confidential Information
- Corporate Procedure 252.05 – Review and Approval of the Collection and Retention of Competitive Information
- Corporate Procedure 401.02 – Review and Approval Process for External Publication or Presentation of Technology Information
- Corporate Procedure 401.03 – Handling Unsolicited Disclosure of Ideas from Third Parties
- Corporate Procedure 402.01 – Export Control and Trade Compliance Procedure
- Corporate Procedure 501.02 – Intellectual Property
- Corporate Procedure 505.01 – Nortel Networks Quality Management System (“NNQMS”)
- Corporate Procedure 505.32 – Product/Solution Design and Test
- Corporate Procedure 505.33 – Product/Solution Delivery
- Corporate Procedure 505.34 – Product Release Management
- Corporate Procedure 506.01 – Delivery Customer Assurance (“DCA”) Process
- Corporate Procedure 601.01 – Research and Development Program
- Corporate Procedure 712.03 – Competitive Purchasing
- Corporate Procedure 712.05 – Purchase Requisitions
- Corporate Procedure 712.12 – Single and Sole Source Suppliers
- Corporate Procedure 712.17 – Environmental Procurement
- Corporate Standard 1505.00 – Contract Manufacturers Products Introduction Process
- Corporate Standard 1509.00 – Dependability Program
- Corporate Standard 1509.01 – Dependability Program Supplemental Documentation
- Nortel Corporate Policies and Procedures are available on the Nortel intranet: Services@Work - Corporate Policies & Procedures
- Nortel Corporate Standards are available on the Nortel intranet: Global Web - Global Quality-Corporate Standards
- Life Cycle Management information and templates are available on the Nortel intranet: http://lcm.ca.nortel.com
- Intellectual Property Law information is available on the Nortel intranet: http://navigate.us.nortel.com/imds?pg=/law/ip
8.0 Review
This Procedure shall be reviewed every three years, or earlier, as required.
9.0 Revision History
- June 3, 2003
- September 13, 2002
End of Document
- Issued by: Sue Spradley, President, Global Operations
- Approved by: Brian McFadden, Chief Technology Officer