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The Process

6 May, 2015 - 16:12

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