Hmmmm … the 4 – 1 seems very dangerous. It would seem that for the first 1 – 2 years ( I am assuming a 2 year timeframe to get a product out the door) , revenue is 0 and cost is everything. There was no way to guage the revenue side of the equation until the product was released. Is this correct? ….
You are right.
A critical part of the job, for myself, and for the studio head, was to make the decision as to when to override the designer on a project – or in some cases, to completely shut down a project. As I said, I generally liked to side with the designer. How far I let a designer go without pulling in the reigns had to do with their track record.
For designers who had several hits in a row, I would go out on a limb more for them, than for a designer on their first or second project.
Throughout a projects ‘life’ there were constantly revised revenue estimates coming in from marketing and sales. We always had a pretty good sense what the advance ‘buzz’ was on a product. If a product had a 10 million dollar revenue forecast one month, and then 5 million the next — this could dramatically affect the permitted R&D budget. A project that was looking fine could ship a dog of a demo, and see their project budget go from comfortable to something much tighter. In some cases, the designer would be upset about this — and, claim it was a self-fulfilling prophecy — and, sometimes they were right. I had to make a lot of decision calls, as to when to ‘stick with’ a designer even when it might seem that their budget and revenue forecast were out of sync.