NEW PRODUCTS — WHAT SEPARATES THE WINNERS FROM THE LOSERS AND WHAT DRIVES SUCCESS
Product Innovation is crucial to the survival and prosperity of the modern corporation. The PDMA Handbook New Product Development, summarizes what separates the winners from the losers and what drive success through Critical Success Factors at the Project and Business Level.
a. Striving for Unique Superior Products: The main driver to success ensure the success and new product profitability, is to deliver unique benefits and superior value to the customer. Evidence of this, is that the best innovators invest more resources (8x) in offer customer new & unique benefits than worst performers.
b. Creating Market — Driven Products and Building in the voice of the Customer (VOC): Contrary to myth, taking a little extra time to execute quality market analysis and market research does not add extra time; rather, it pays off, not only with higher success rates but also in terms of staying on schedule and achieving better time efficiency.
The management implication is that a market focus should prevail throughout the entire new product project, with best practices (Griffin and Hauser, 1996) such as: Idea generation, design of the product, testing prototype and verification of all assumptions about the winning design.
c. Predevelopment Work (the Homework): Countless studies reveal that the steps that precede the actual design and development of the product make the difference between winning and losing (Cooper, 2011a; Edgett, 2011). Successful firms spend about twice as much time and money as unsuccessful firms.
“The Homework” is based in the following activities: Decision to begin the project, initial market study, preliminary technical assessment, development of detailed market study, market research & VOC research and the analysis of business-financial plan. All of these activities will allow take the decision to go to development.
d. Sharp, Early, Stable, and Fact-Based Project and Production definition: To avoid the wasting time in new-product project is necessary perform “The Homework” adequately. The following activities will allow saving time and resources:
· Definition of the project’s scope (e.g., domestic versus international; line extension versus new product item versus platform development)
· Specification of the target market: exactly who the intended customers or users are.
· Description of the product concept and the benefits to be delivered to the user (including the value proposition).
· Delineation of the positioning strategy, including the target price.
· A list of the product’s features, attributes, requirements, and specifications (prioritized: “must have” and “would like to have”).
e. Spiral Development-Build, Test, Feedback, and Revise: Spiral development helps the project team get the product and product definition right. This is the way fast-paced teams handle the dynamic information process with fluid, changing information.
They build in a series of iterative steps or loops whereby successive versions of the product are shown to the customer to seek feedback and verification, as following:
· Build something, even if it’s only a model or representation of the product.
· Test it: get it in front of the customer or user and gauge interest, liking, preferences and purchase intent, likes and dislikes.
· Get feedback: find out the customer’s reactions firsthand and, most important, what must be fixed or changed.
· Revise: update the product definition based on this feedback, and get set for the next iteration of build test-feedback-and-revise, but this time with a product version one step closer to the final product.
f. The World Product — A global Orientation: In global markets, product development plays a primary role in achieving a sustainable competitive advantage (Kleinschmidt, de Brentani, and Salomo 2007).
A global orientation means defining the market as an international one and designing products to meet international requirements, not just domestic ones. The result is either a global product (one version for the entire world) or a glocal product (one development effort, one product concept or platform, but perhaps several product variants to satisfy different international markets).
g. Planning and Resourcing the Launch: To develop a new product is recommended don’t assume that good products sell themselves, and don’t treat the launch as an afterthought. Even though the launch is the last step in the project, never underestimate its importance. There are five requirements for an effective market launch plan, this will be completed developing: integral part of new product process, must begin early, market intelligence, define the launch with properly resource and execute the launch ensuring the valuable input.
h. Speed-But Not at the Expense of Quality of Execution: Speed yields competitive advantage — the first on the market; it means less likelihood that the market or competitive situation has changed. Some sound principles that project teams embrace in order to reduce time to market includes Do the “homework”, build in quality of execution all stages of the project, use parallel processing and spiral development, among others.