There are several stages in the new product development process...not always followed in order:
1. Idea Generation (The "fuzzy front end" of the NPD process, see below)
- ideas for new products can be obtained from customers (employing user innovation), the company's R&D department, competitors, focus groups, employees, salespeople, corporate spys, trade shows, or through a policy of Open Innovation
- formal idea generating techniques include attribute listing, forced relationships, brainstorming, morphological analysis, problem analysis
2. Idea Screening
- the object is to eliminate unsound concepts prior to devoting resources to them.
- the screeners must ask at least three questions:
- will the customer in the target market benefit from the product?
- is it technically feasible to manufacture the product?
- will the product be profitable when manufactured and delivered to the customer at the target price?
3. Concept Development and Testing
- develop the marketing and engineering details
- who is the target market and who is the decision maker in the purchasing process?
- what product features must the product incorporate?
- what benefits will the product provide?
- how will consumers react to the product?
- how will the product be produced most cost effectively?
- prove feasibility through virtual computer aided rendering, and rapid prototyping
- what will it cost to produce it?
- test the concept by asking a sample of prospective customers what they think of the idea
4. Business Analysis
- estimate likely selling price based upon competition and customer feedback
- estimate sales volume based upon size of market
- estimate profitability and break even point
5. Beta Testing and Market Testing
- produce a physical prototype or mock-up
- test the product in typical usage situations
- conduct focus group customer interviews or introduce at trade show
- make adjustments where necessary
- produce an initial run of the product and sell it in a test market area to determine customer acceptance
6. Technical Implementation
- New program initiation
- Resource estimation
- Requirement publication
- Engineering operations planning
- Department scheduling
- Supplier collaboration
- Resource plan publication
- Program review and monitoring
- Contingencies - what-if planning
7. Commercialization (often considered post-NPD)
- launch the product
- produce and place advertising and other promotions
- fill the distribution (business) pipeline with product
- critical path analysis is most useful at this stage