1. NEW PRODUCT & SERVICE DEVELPMENT GH New York University SPCS Spring 2007

3. Background Dalumi is a leading diamonds manufacturing company based in Israel, with more then 600 employees all over the world. Dalumi have offices in Israel, USA, Hong Kong, China, Japan, Belgium, Spain and France. History 1960 Founded by Asher Dalumi 1989 Second generation join the company 1993 DTC Sight granted 1995 Received Outstanding exporter reward 1996 Recognized as one of the top five manufactures in Israel 2000 Established Jewelery division in Hong Kong 2005 Received outstanding exporter award to Japan 2006 No. of employees exceeded 600 2007 Received a second sight from DTC and opening new diamond manufacturing facility in Botswana

4. Mission & Vision Our mission is to maintain and enhance our role as a leading, global diamond and Jewelery business operating from rough to polished to fine diamond Jewelery. We Strive to be the first choice of our strategic customers. We Aspire to continue our profitable growth while maintaining our personalize touch. Our corporate believes & values Honesty & Integrity Personal Responsibility Professionalism Excellence Teamwork & Cooperation

5. Overview Diamond Mines De Beers DTC Dalumi Diamonds Rough Department Factory Polished department Assortment Pricing Inventory data Europe USA Asia

6. Distribution in the U.S Dalumi N.Y Office Diamond Dealers Wholesalers Jewelers manufactures Jewelry Retail Stores

7. How can Develop New Products and Services ideas?

8. Stage gate process Gate 1 Scoping Gate 2 Build Business Case Gate 3 Development Gate 4 Testing Gate 5 Post Launch review Discover y

9. Ideation / discovery Action are in use through this stage: Ideas are generated, following company vision & mission guides Front line Sales people input. A focus group of sales people is created, in which they asked to brainstorm about potential new services with the intention of increasing their sales volume, and reaching to new clients. Front line management input. A survey is given to Management to find out there ideas for increasing revenues, cutting expenses, and utilize sales people. Customer input. Interviews with clients to find out their expectations and feedbacks from our sales people, and from company availability. Discovery Gate 1 Scoping Gate 2

10. Ideas Bank (Brainstorm/gather ideas) Open an Online Diamond store Venture together with the fashion industry Hire new sales representatives Open a new Dalumi office in another city Open a retail Jewelery chain stores Start selling different shapes and sizes of diamonds Give bigger and longer credit to our clients. 120, 150 days Venture together with the toys industry Start selling to the retail stores market Brainstorming more ideas………………………..

11. Gate 1: initial screen Testing each idea generated during brainstorming session. To confirm whether each one is suitable to the needs of the company, that we found during the research & discovery stage, and whether it meets the following criteria? Discovery Gate 1 Scoping Gate 2

12. Is there market attractiveness to open a new office ? Yes=Go N0=Kill Discovery Gate 1 Scoping Gate 2

13. Open a retail Jewelery chain stores Yes=Go No=Kill Discovery Gate 1 Scoping Gate 2

14. Venture together with the fashion industry Yes=Go No=Kill Discovery Gate 1 Scoping Gate 2

15. Go/Kill Ideas Kill Open a retail jewelry chain stores Venture together with the toys industry Start selling different shapes and sizes of diamonds Start selling to the retail jewelry stores market GO Open a new office in another city Venture together with the fashion industry Hire new sales representatives Give bigger and longer credit to clients

16. Stage 1: Scoping the spirit of this stage is to spend a little money, gather some information, so that project can be re-evaluated at the next gate. This stage is a quick and inexpensive assessment of the technical qualities of the project and its market prospects. Preliminary market assessment Preliminary technical assessment Preliminary business & financial assessment Discovery Gate 1 Scoping Gate 2

17. Scoping Preliminary market assessment: Involve a quick and dirty market study. The purpose is to determine whether the proposed product has any commercial prospects. Internet research Your own library Internal Reports Key customers Preliminary Technical Assessment: What will the product requirements be? Do we have the technological capability to develop it? Preliminary Business and financial Assessment: Do we have what it takes to win here? Do we need a partnering or outsourcing relationship? Estimates of expected sales and costs Discovery Gate 1 Scoping Gate 2

18. Gate 2: Second Screen Objective: Scoped idea are revaluated, and discuss information gathered during stage 1. Gatekeepers: Legal: Labor, Compliance Technical: Diamonds supply Sales: coordinate with N.Y sales manager Accounting and finance teams Discovery Gate 1 Scoping Gate 2

19. What was the feedbacks from the focus group? Discovery Gate 1 Scoping Gate 2 Kill Hire new sales representatives to the company Give bigger and longer credit to clients GO Open new office in another city Venture together with the Fashion industry

20. Stage 2: Build Business Case Proceedings: a detailed investigation and Business evaluation stage that defines the product and verifies the attractiveness of the project prior to heavy spending. Target market definition Description of the product/service concept Specification of a product/service strategy Determination the customers need, wants, and preferences. To help define the winning product Build Business Case Gate 3 Development Gate 4

21. Build business case Venture with the fashion industry Open new office in L.A The target market for this product is the High End fashion designers The product is diamonds for exclusive fashion designers( Shoes. Dresses and accessories) Strategy-to find fashion designers that use diamonds with their products, by the marketing department Brand and advertise Dalumi Diamonds Downtown L.A is the second biggest diamond market after N.Y The purpose of opening a new office in L.A is to provide better service for our clients by giving first and quick solutions to their needs. The goal is to increase profits by 15% in the first year and cut expenses.

22. Gate 3: Decision to Develop base on Business Case Objective : To choose one idea to develop, specific suggestion based on the business evaluation. Last point at which a project can get killed before entering heavy spending Gate 3 subject the project to the set of must-meet and should-meet criteria used at Gate 2 Results of financial analysis are an important part of this screen Build Business Case Gate 3 Development Gate 4

23. Gate 3: GO/Kill Decision Build Business Case Gate 3 Development Gate 4 KillGO

24. Stage 3: Development Here the business case plans are translated into concrete deliverables. One prototype product that meet the requirements of the Lab tests, in house tests, alpha tests and customers feedbacks is being chosen. Parallel Actions During this stage: physical Development- technical development Market analysis- Marketing operations Customer Feedbacks- Designing customer tests Operations activities Make time lines Detailed test plans Market launch plans Build Business Case Gate 3 Development Gate 4

25. Constant Iterations: Rapid prototype and test with customers throughout the development stage. Build Feedback Test Build Feedback Test Build Feedback Test

26. Development Set meeting with fashion designers that use diamonds within their products Market analysis- see what is the size of the market, how many designers use diamonds? Technical analysis- check the factory and technical people, make sure everyone on the same page Financial analysis Build Business Case Gate 3 Development Gate 4

27. Gate 4: Post-Development Review Objectives: Re-evaluate in opposition to Financial/ Budget restriction To decide what will be accepted as success and failure when testing are run at a larger level Deliverable: Gatekeepers: established financial analysis - Senior Management Determine value of services Criteria : Is the project within budget Build Business Case Gate 3 Development Gate 4

28. Stage 4: Testing & Validation this stage test and validates the entire project: The project itself, the production process, customer acceptance, and the economic of the project. In house product tests Field trials of the product Test market Business and financial analysis Testing Gate 5 Post Launch review

29. Gate 5: Business Analysis It is the final point at which the project can still be killed This gate is focused on the quality of the activities in the testing stage and their results Expected Financial return suitability of the launch and operations start up plans Testing Gate 5 Post Launch review

30. GO / Kill Will we be able to supply this amount of diamonds? Do we have enough man power at our company to keep with productions? Do we have the capability to manufacture specific orders for the clients Will we make any profit? Do we have enough clients? Will this project will help branding our company name? Testing Gate 5 Post Launch review

31. Stage 5: Market Launch This final stage involves accomplishment of both the marketing launch plan and the production operations plan. Testing Gate 5 Post Launch review

32. Post Launch Review: This is the point where the project and products is reviewed Latest data on revenues Costs Profits Timing What we learned from this project and how the next project can be done better Testing Gate 5 Post Launch review