Product Development slide

1. An introduction to New
Product Development (NPD)
BM050-3-3 Innovation Management and New
Product Development (IMNPD)

2. Module Code and Module Title Title of Slides
Introduction
Personal Introduction- Please tell me a
little bit about yourself including your
 Name(by which you like to be called)
 Working Experience if any
 Nationality
 Tools or skills you would like to gain from this class

3. Module Code and Module Title Title of Slides
Class Structure
Course Level
 Semester 2 Year 4 (Engineering)
 Semester 2 Year 3
Prerequisites
 Creativity and Innovation
Course assessment overview
 In course assignment (60% )
 Final Exam (40% )

4. Module Code and Module Title Title of Slides
Learning Outcome
1. Demonstrate knowledge and understanding of
the widely recognized attributes necessary in
developing and successfully commercialising a
new product.
2. Develop coherent lines for argument and
suggested informed solutions to innovation
management scenarios.
3. Apply and evaluate innovation management
and new product development techniques for
launch planning, implementation and
management

5. Module Code and Module Title Title of Slides
Learning Objectives
 Recognise the importance of innovation
 Explain the meaning and nature of
innovation management
 Provide an introduction to a management
approach to innovation
 Recognise the need to view innovation as
a management process

6. Module Code and Module Title Title of Slides
Class 1- Introduction
Why is New Product Development
important?

7. Module Code and Module Title Title of Slides
New Product Development-
Introduction
“ New Product development is one of the riskiest, yet
most important, endeavors of the modern corporation.
Certainly the risks are high. You and your colleagues
have seen as large amounts of money spend on new
product disasters in your own firm. But then, so too are
the rewards.
New product currently account for a staggering 33%
of company sales on average. That is one third of the
revenues of corporations are coming from products, they
did not sell five years ago. In some dynamic industries,
the figures is as high as 100%!!!”

8. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Research in this area suggest that 65% of
new product launches succeed
 And this is only the success rate of those
products that actually make it to their actual
launch
 Some researchers have found that only 20%
of all products upon which development has
begun actually succeed.

9. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Rewards from Successful New Product
Development
 Astounding ROI: The average ROI for
successful new products is 96.9%
 Payoff very quickly: The average payback
period is 2.49 years
 Excellent market positioning: The average
market share in their defined target markets is
47.3%

10. Module Code and Module Title Title of Slides
New Product Development-
Introduction
“Innovation is not a single action but a
total process of interrelated sub process.
It is not just the conception of a new idea,
not the invention of a new device, nor the
development of a new market. The
process is all these things acting in an
integrated fashion”

11. Module Code and Module Title Title of Slides
Innovation vs Invention
 Innovation is concerned with the commercial
and practical application of ideas or
inventions.
 Invention is the conception of the idea into a
tangible new product or process. Innovation is
the subsequent translation of that idea into
the economy
 Innovation = theoretical conception +
technical invention + commercial exploitation.

12. Module Code and Module Title Title of Slides
Innovation as Management
process
 Innovation is the management of all the
activities involved in the process of idea
generation, technology development,
manufacturing and marketing of a new (or
improved) product or manufacturing
process or equipment.

13. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Rewards from Successful New Product
Development (median value)
 50% of successful new products achieve 33%
ROI or better
 Half of successful new products have a
payback period of two years or less
 Half of successful new products achieve a
market share in excess of 35%

14. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Why is there a need for organization to
innovate?
 Technology Advances
 Changing Customer Needs
 Shortening Product Life Cycles(PLC)
 Increased World Competition
Will these reasons be no longer relevant in
the next 40 or 50 years?

15. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Different Types of innovation
 Product Innovation
 Process Innovation
 Organization Innovation
 Management Innovation
 Production Innovation
 Commercial/Marketing innovation
 Service Innovation

16. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Why New Product Development?
 Increasing level of innovation in competitive
environment settings
 More resources are being dedicated into
innovating products
 Success of such resource allocation is
inconsistent at best
 A structured approach to new product
development is require to enhance success
rate

17. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Winning at New Products
 Speed yields competitive advantage?
 Speed yields higher profitability?
 Speed means fewer surprises?

18. Module Code and Module Title Title of Slides
New Product Development-
Introduction
Categories of New Products
1. New to the world products
2. New product lines
3. Additions to existing product lines
4. Improvements and revisions to existing products
5. Repositioning
6. Cost reduction

19. Module Code and Module Title Title of Slides
Questions?

20. Module Code and Module Title Title of Slides
Tutorial
1. What is wrong with the popular view of
innovation in which eccentric scientist develop
new products?
2. What is the difference between an
unsuccessful innovation and an invention?