What are the steps you need to have in place for a repeatable, successful new product development process?
Creating a repeatable system for creative ideation, idea screening, planning, development and product launch can mean the difference between a company that is commercially viable and a company that is losing money and momentum as they struggle to find and execute their ‘next big product idea’.
These are 8 steps that you can formalise into a product development process that will keep you innovating in the most flexible, sustainable, and profitable way:
Companies need to have a clear-eyed view of the challenges and feasibility inherent in certain ideas, but they need to have a range of creative wells to draw from as they think of their next big product idea.
Companies should always be ideating, finding ways to feed new product ideas into the organisation from across their internal teams and elsewhere. Formal and informal processes should funnel ideas into the mix, resulting in sound initial proposals for further exploration. These tactics and techniques include:
At the end of this process there should be a formal means of submitting proposals for further screening by your business. This will entail providing a minimum level of supporting evidence and documentation to share with key decision-makers.
Before further resources are allocated to any of these projects, the ideas must be filtered. This is often done by a panel of experts drawn from your internal teams. For each product concept, they should ask the following questions to assess initial feasibility:
After a number of initial ideas are approved for further development, detailed feasibility studies should begin. The business should be working on documentation that captures:
Businesses can help prove feasibility through virtual computer-aided rendering, and rapid prototyping.
Answering these questions and seeing a rapid prototype in the flesh, can help validate customer and market need, as well as your potential design and pricing strategy.
To help the company decide what ideas have the most promising future, you should create a potential marketing plan for each. A competitive marketing strategy comprises four key elements.
These are the hard-nosed calculations that you will need to feed into your stop/go decision-making at this critical stage of the product roadmap.
If the figures add up and there is a compelling business case for your new product - then the business can approve development to start.
Now, the detailed, exhaustive project requirements are assembled that will guide the design and development phase.
Formal engineering specifications are created. Verification and validation plans are developed for the future. These are the final quality checks that will systematically determine that all agreed deliverables are present and working in the final product. The product is then developed against designs, with regular checks made throughout the process to assess and mitigate the risk of its failure for the end-user and the project itself. Requirements for this process include:
When you have developed the product and the first complete prototype is available, you need to test it thoroughly:
Now is your opportunity to tweak the product based on market feedback, in readiness to bring it to market.
It might be time for your product launch, but the development work doesn’t stop there.
Your product manager needs to monitor the success of the product as it is rolled out. They need to plan for future upgrades and potential new additions to your suite:
To implement a successful process you need the right combination of skills available in your product management and marketing team to balance innovation with pragmatism.
You need a blend of maverick creativity, complete customer focus, a hard-nosed commercial outlook, and of course, a seamless commercialisation process.
And if that sounds like a hard trick to pull off, you’d be right. Estimates put the rate of new product failure at between 30 and 50%. And in a healthy, sustainable business those new products should be accounting for 30% of profits.
Risk of project failure is everywhere for the product teams and marketing departments hoping to bring innovation to a crowded marketplace.
VUCA - the famous futurist acronym - sums up these challenges perfectly. In the age of disruptive technology, business success is constantly threatened by Volatility, Uncertainty, Complexity and Ambiguity.
Even those with a suite of highly successful products on the market can be caught off guard as trends change rapidly, components and materials suddenly become unavailable, outmoded, or unprofitable to use.
Likewise, entirely new business models, technologies and design thinking can suddenly change customer demand in unexpected ways. You need to have agile teams in place to address these pressures.
The academic and consultant Bob Johansen has proposed a leadership response to the challenge of VUCA environment which he calls VUCA Prime. According to Johansen:
Developing a repeatable system for NPD like the one described above is the way to build-in protection from product failure; it provides a space for creativity as well as laser-focused requirements gathering and idea validation.
It formalises STOP/GO moments within the process, to assess evidence and decide whether to kill or continue with projects at critical moments depending on their changing potential for success.
If you develop the right structures to bring new ideas to the fore, filter and control them, you can embrace change and risk, while keeping your focus on your customers, profitability, and a sustainable future.
But you may require a complete revamp of your partner network and supplier chain to find this kind of agility.
For example, the potential for miniaturisation, IoT and app integration to change the use cases for your proposed product could make it much more valuable in the marketplace. But if you don't have the ability to design and prototype this technology you won't be able to explore the full potential of such a pivot.
For this you may need to partner with an Electronics Manufacturing Services (EMS) provider that can offer both product design and volume manufacturing services to give you the flexibility and confidence you need to develop new kinds of products in new markets.
The reality of a turbulent, ever-changing market demands a new kind of discipline to survive. Are you ready to embrace it?