New Product Development

Question: Write a report on new product development. Answer: Reflection After understanding the different models, theories and frameworks, I can appreciate that new product development is a strategic decision that can going to have a long lasting effect and can make or break the company and thus has to be taken very carefully. Also, each organization is different in terms of its vision, mission, strategy towards innovation, culture, learning environment and thus there is no single theory that fits all. Each organization uses the new product development in their own way aligned to their strategy (Cooper, Sommer, 2016). For example, General Electric and 3M both innovate but in their own way. GE has implemented Six sigma and when few senior folks from GE joins 3M, they also tried to implement six sigma in 3M which killed the innovation in 3M. It is because 3M does have six sigma and variation was there in processes, Post-it was invented which is a he success in the market (Woodside, 2013). Thus, I understood, each organization has to take its own path in its journey to innovation. Also, Each theory has pros and cons with respect to the organization and also organizations mould the models such that it is convenient for them to use model and to get the maximum out of these models. Motivation for New Product Development Also, I understood that new product development is very important for the enterprises if they want to survive in this age of competition, globalization and digitalization. I have studies numerous case studies that simply demonstrate why new product development is required and what is the motivation for it. For instance, big organizations like Xerox, Kodak, Lucent technologies failed to keep up the pace with the pace of introducing new products and innovation and suffered badly (Cuthbertson, Furseth, Ezell, 2015). Not only this, there are organizations like 3M, Apple and Dell that constantly innovates and thus are the leaders in their areas. Idea to launch Model I will be sharing my views on one of model called Idea to launch model. This model has benefitted many companies like Emerson Electric, 3M, GE and PG. Dell is also one such company where this model is implemented. There are 7 stages in this model including discovery and Post-Launch review and each stage has an entry and exit criteria, well defined deliverables and outputs. Output can be like Go, Stop, Hold. Deliverables can be in form of documents (Cooper, Edgett, 2012). I think this model is quite effective and powerful tool for the organizations if implemented properly. It can definitely reduce the product failure rates, fewer errors and accelerate the time to market the products. But some organizations increased the stages in this stage gate method and also put more restriction in entry and exit criteria of each gate. I feel though this is a good way of reducing the chances of failure, it can also bring in bureaucracy that can be discouraging for the key employees in this process of new product development. I feel organizations must achieve balance here. If Organizations become too lenient, it is possible that product failure is determined at a later stage and thus wasting more resources and costs of the organizations. However, if organizations become demanding, it will defeat the purpose of innovation as people feel pressurized. For instance, Earlier Johnson and Johnson has deliverables consisting of 30-90 page presentation for each of the gates which is obviously takes lot of time and sideline the original idea of innovation. But now they introduce lean stage gates where deliverables are shrinked to 1 page document. One way of achieving this balance is that Organizations should take mortality curve of ideas into account (Makham, Lee, 2013). To understand this better, let us suppose there are 40 ideas and only 1 is implemented and 39 are rejected. Then maximum ideas (75%) will be rejected during screening. Then when ideas are subjected to rigorous economic evaluation, another 15% will be died and very few will die say 5-6% during the development. And then again during testing, there are some casualties but the no. is very few. As a result, most of the ideas die down at the beginning. So, there will be too much discussion, requirements and criteria for the first 2 stages and criteria should ease down afterwards. Also, this model is very high level model and should be coupled with other theories and models at each stage. For example, Stage 1st talks about discovery of idea but not how ideas can be discovered. Some of the sources of the ideas can be customer needs, Vendors, subcontractors, Top management, new technologies, cost cutting ideas, changing lifestyles and Sales and marketing department. Similarly, Stage 2 talks about the screening and viability of the ideas but the criteria and tools to do this is left open for the organizations to decide for themselves. Subsequent stages discuss about turning the selected idea into the exact product specifications but how this is done is ignored. For instance, companies use Quality function deployment (QFD), value analysis, Computer Aided design, Taguchi method, prototyping for these purposes. Dell has been using this process for new product development from last 20 years and has quite benefitted from it (Bayus, 2013). Emerson electric and 3M also benefitted from it. However, there are some organizations also where this model has not shown any results. Model is same however its application differs from organization to organization. As a result, I think it would be improper to say that model is success or failure. It is actually how effectively the management uses it that makes it success or failure. For instance, In ITT, manufacturing giant, different stakeholders demands huge documentation from the project team without understanding that this non value added work can also be done later and not required in the initial stages. Management should mould this model according to their organizations culture such that this model should only smoothen new product launches and avoid failure instead of killing the innovation (Saattayaraksa, Boon-itt, 2014). Reference Bayus, B. L. (2013). Crowdsourcing new product ideas over time: An analysis of the Dell IdeaStorm community.Management Science,59(1), 226-244. Cooper, R. G., Edgett, S. J. (2012). Best practices in the idea-to-launch process and its governance.Research-Technology Management,55(2), 43-54. Cooper, R. G., Sommer, A. F. (2016). The AgileStage Gate Hybrid Model: A Promising New Approach and a New Research Opportunity.Journal of Product Innovation Management. Cuthbertson, R., Furseth, P. I., Ezell, S. J. (2015). Kodak and Xerox: How High Risk Aversion Kills Companies. InInnovating in a Service-Driven Economy(pp. 166-179). Palgrave Macmillan UK. Markham, S. K., Lee, H. (2013). Product development and management association's 2012 comparative performance assessment study.Journal of Product Innovation Management,30(3), 408-429. Sattayaraksa, T., Boon-itt, S. (2014, January). The roles of CEO transformational leadership on product innovation. InISPIM Conference Proceedings(p. 1). The International Society for Professional Innovation Management (ISPIM). Woodside, J. M. (2013). MANAGING IT INNOVATION: RECESSIONARY AND POST-RECESSIONARY SERVICE AND STAFFING MODELS.International Journal of Managing Information Technology,5(3), 1.