3. About New Product Process
Understand the characteristics of product
processes including:
Phases from concept to launch
Lifecycles
Decision points and gates
Required activities for each phase
A good new product process increases
chances of success and cuts losses from
losing products early
4.
5. Product Life Cycle
A way to trace the stage of a product’s acceptance
from its introduction to its demise.
A tool to help marketers understand, where their
product is now, what may happen, which strategies
are normally appropriate.
7. Introduction Stage
Cost are high
Slow sales volumes to start
Little or no competition
Demand has to be created
Customers have to be prompted to try the product
8. Growth Stage
Cost reduced due to economies of scale
Sales volume increases significantly
Profitability begins to rise
Public awareness increases
Competition begins to increase with few new
players in establishing market
Increased competition leads to price decreases.
9. Mature Stage
Costs are lowered as a result of production volume
increasing and experience curve effects
Sales volume peaks and market saturation is
reached
Increase in competitors entering the market
Price tend to drop due to the proliferation of
competing product
Brand differentiation and feature diversification is
emphasized to maintain or increase market share
Industrial profits go down
10. Decline Stage
Costs become counter-optimal
Sales volume decline or stabilize
Price, profitability diminish
Profit become more a challenge of
production/distribution efficiency than increases
11. The Life Cycle and Consumers
At the market level, the new product is first in the
marketplace:2.5% of the market.
Early adoptors:13.5% of the market
Early majority: 34% of the market
Late majority: 34% of the market
The laggards: 16%
12.
13.
14.
15. Five gambling rules:
Step 1: When the uncertainties of the new product
project are high (that is, when the prospects of
success are fuzzy), keep the amounts at stake low.
When you don’t know where you’re going, take
small steps. 當不確定性高時,別賭太大
16. Five gambling rules:
Step 2: As the uncertainties decrease, let the
amounts at stake increase. As you. Learn more
about where you are going, take bigger and bigger
steps. 當風險降時,逐漸加碼
17. Five gambling rules:
Step 3: Incrementalize the new product process
into a series of steps or stages. Treat it as a series
of options purchases. Each step should be more
costly than the one before. 分批加注
18. Five gambling rules:
Step 4: View each stage as a means of reducing
uncertainty. Remember that information is the key
to uncertainty reduction. Each step in the process
that creates an expenditure must reduce
.
uncertainty by an equivalent amount. “Buy a series
of looks” at the project‘s outcome. 看每個階段逐漸
降低不確定性,花小錢買資訊
19. Five gambling rules:
Step 5: Provide for timely evaluation, decision, and
bail-out points. These decision points pull together
all the new information from the previous stage
and pose the questions, .“Are you still in the game?
Should you proceed to the next stage, or kill the
project now?” 設定停損點,適時退場
20. Product Development
It is the overall process of strategy, organization,
concept generation, product and marketing plan
creation and evaluation, and commercialization of
a new product.一種新產品的整個流程的策略、組織、
概念代、產品/行銷計劃制定和評價,以及商業化。
21. New Product Process
A disciplined and defined set of tasks and steps
that describe the normal means by which a
company repetitively converts embryonic ideas
into salable products or services.
22. Seven Goals of a New Product
Process
Goal #1: Quality of Execution
Goal #2: Sharper Focus, Better Prioritization
Goal #3: Fast-Paced Parallel Processing
Goal #4: A True Cross-functional Team
Approach
Goal #5: A Strong Market Orientation with
Voice of the Customer Built In
23. Seven Goals of a New Product Process
Goal #6: Better Homework Up-Front
Goal #7: Products with Competitive Advantage
24. Goal #1: Quality of Execution
There exists the need for a more systematic and
quality approach to the way firms conceive,
develop, and launch new products.
The way to deal with the quality problem is to
visualize product innovation as a process and to
apply process management and quality
management techniques to this process.
Note that any process in business can be
managed, and thus it can be managed with a view
to quality.
25. Goal#2: Sharper Focus, Better Prioritization
A “new product funnel” builds in tough go/kill
decision points;
One funneling method is to build the new product
process around a set of gates or go/kill decision
points.
These gates are the bail-out points where we ask,
"Are we still in the game?"
Gates are analogous to the quality-control
checkpoints in the new product process
26. Goal #3 Fast-Paced Parallel Processing
In marked contrast to the relay or sequential
approach, with parallel processing many activities
are undertaken concurrently rather than in a series.
Due to cross-functional and multidisciplinary in
entire NPD process, players run down the field
with much interaction, constantly passing the ball
laterally.
27. Goal #4 A True Cross-functional Team
Approach
The multifunctional nature of innovation coupled
with the desire for parallel processing means that a
true cross-functional team approach is mandatory
in order to win at new products.
The project team is cross-functional to release
time from their normal jobs to spend on the project
is provided to team members.
The project team has a clearly defined team
captain or leader.
28. Goal #5 A Strong Market Orientation with Voice of
the Customer built in
If superb new product success rates are the goal,
then a market orientation executing the key
marketing activities in a quality fashion must be
built into the new product process as a matter of
routine, rather than by exception.
Marketing inputs must play a decisive role from
beginning to end of the project.
29. Goal #6 Better Up-Front Homework
The up-front homework helps to define the product
and to build the business case for development.
The ideal new product process ensures that these
early stages are carried out before the project is
allowed to proceed before the project enters full
fledged Development.
30. Goal #7 Products with Competitive Advantage
Ensure that at least some of the criteria at every gate
focus on product superiority.
Require that certain key actions designed to deliver
product superiority be included in each stage of the
process.
Demand that project teams deliver evidence of product
superiority to project go/kill reviews; make product
superiority an important deliverable and issue at such
meetings
31. 8 points of A Systematic New Product Process
The new product process must be a quality process.
There is a dear need for a systematic new product
process to guide and facilitate the new product project
from idea to launch.
2. The process or game plan must be designed to manage
risk; a multistage and gate framework is most
appropriate.
3. Gates are central to the new product process.
4. Parallel processing balances the need for a complete
and quality process with the desire for a speedier process.
1.
32. 8 points of A Systematic New Product Process
The process requires a cross-functional, empowered
team headed by a team leader with authority.
6. The process is market-driven and customer-focused.
7. Up-front or predevelopment homework is crucial to
success, and these activities must be built into the game
plan in a consistent and systematic way.
8. The quest must be for superior differentiated products
that offer value to the user.
5.
33. Essential up-front activities
Initial screening 初步篩選
Preliminary technical assessment 初步技術評估
Preliminary marketing assessment 初步行銷評估
Detailed technical assessment 詳細的技術評估
Manufacturing or operations assessment製造或業務評估
Detailed market studies詳細的市場研究
Resource and capabilities assessment資源和能力的評估
Financial and business analysis 金融和商業分析
Product definition and business case產品的定義和業務案例
Decision on business case決定商業案例
34. Nine integral and mandatory marketing actions
Customer-based idea generation
Preliminary market assessment
Market research to determine user needs and
wants
Competitive analysis: an assessment of competitors
Concept testing
Customer reaction during development
User tests
Test market or trial sell
Market launch
35. New Product Process
PDMA Process
Discovery
Development
Commercialization
Phase Process
Opportunity
Identification/
Selection
Concept
Genera
tion
Concept/
Project
Evaluation
Develo
pment
Launch
Stage-Gate Process
Idea
Discovery
Screen
Goto Testing
Scop
ing
Testing and
Validation
2nd
Screen
Build
Business
Case
Goto Launch
Go to
Develop
ment
Launch
Develop
ment
36. Phase 1: Opportunity Identification and Selection
Generate new product opportunities as spinouts of
the ongoing business operation, new product
suggestions, changes in marketing plan, resource
changes, and new needs/wants in the marketplace.
Research, evaluate, validate, and rank them (as
opportunities, not specific product concepts). Give
major ones a preliminary strategic statement to
guide further work on them.
37. Phase 2: Concept Generation
Select a high potential/urgency opportunity, and
begin customer involvement. Collect available new
product concepts that fit the opportunity and
generate new ones as well.
38. Phase 3: Concept/Project Evaluation
Evaluate new product concepts (as they begin to
come in) on technical, marketing, and financial
criteria. Rank them and select the best two or
three. Request project proposal authorization
when have product definition, team, budget,
skeleton of development plan, and final PIC.
39. Phase 4: Development
A. Technical tasks
Specify the full development
process and its deliverables.
Undertake to design
prototypes; test and validate
prototypes against protocol;
design and validate
production process for the
best prototype; slowly scale
up production as necessary
for product and market testing.
• B. Marketing tasks
• Prepare strategy, tactics,
and launch details for
marketing plan, prepare
proposed business plan
and get approval for it,
stipulate product
augmentation (service,
packaging, branding, etc.)
and prepare for it.
40. Phase 5: Launch
Commercialize the plans and prototypes from
development phase; begin distribution and sale of
the new product (maybe on a limited basis); and
manage the launch program to achieve the goals
and objectives set in the PIC (as modified in the
final business plan).
44. Gate
The point is at which a management decision is
made to allow the product development project
to proceed to the next stage, to recycle back
into the current stage to better complete some of
the tasks, or to terminate. The number of gates
varies by company.
45. Gate Input
Gates serve as quality-control check points, as
go/kill and prioritization decisions points.
1. A set of required deliverables :This is what the
project leader and team must bring to the decision
point (for example, the results of a set of completed
activities). These deliverables are visible, are based
on a standard menu for each gate, and are decided
at the output of the previous gate. Management's
expectations for project teams are thus made very
clear.
46. Gate Criteria and Output
2.Criteria against which the project is judged: These
include "must-meet" or "knock-out" questions (a checklist)
designed to weed out misfit projects quickly. There are also
"should-meet" criteria or desirable factors, which are
scored (a point count) and used to prioritize projects.
3. Defined outputs: These include a decision
(go/kill/hold/recycle), an approved action plan for the next
stage (complete with people required, money and persondays committed, and an agreed time line), and a list of
deliverables and date for the next gate.
49. Gatekeeper
The group of management serves as advisors,
decision-makers and investors in a Stage-Gate
process. Using established business criteria, this
multifunctional group reviews new product
opportunities and project progress, and allocates
resources accordingly at each gate. This group is
also commonly called a Product Approval
Committee or Portfolio Management Team.
Gatekeepers include Banker, Enforcer, Quality
Assurors, Mentors and Godfather.
50. Stage 0: Discovery
Discovery Stage builds in a defined, proactive idea
generation and capture system. Activities in the
Discovery Stage include undertaking directed but
fundamental technical research, seeking new
technological possibilities;
51. Gate 1: Idea Screen
The first decision to commit resources to the project:
The project is born at this point.
Criteria often deal with strategic alignment策略,
project feasibility可行性, magnitude of opportunity 市
場機會and market attractiveness市場吸引力, product
advantage產品優勢, ability to leverage the firm's
resources, and fit with company policies.
Financial criteria are typically not part of this first
screen
52. Stage 1: Scoping
This first and inexpensive homework stage:
objective of determining the project's technical and
marketplace merits
Concurrently a preliminary technical assessment is
carried out, involving a quick and preliminary inhouse appraisal of the proposed product.
53. Gate 2: Second Screen
Project is subjected to a second and somewhat
more rigorous screen at Gate 2.
The project is reevaluated in the light of the new
information obtained in Stage 1.
54. Stage 2: Build Business Case
opens the door to product development. It is also the
critical homework stage
The elements of this definition include target market
definition; delineation of the product concept;
specification of a product positioning strategy, the
product benefits to be delivered, and the value
proposition; and the spelling out of essential and
desired product features, attributes, requirements,
and specifications.
55. Business Case
Business Case: The results of the market, technical
and financial analyses, or up-front homework市場,
技術和財務分析,或前期功課的結果. Ideally defined
just prior to the "go to development" decision (gate),
the case defines the product and project, including
the project justification and the action or business
plan 構想的定義是在“走到發展”的決定(門)之前,
確定了專案的產品和項目,包括項目正當性和專案計
劃.
Key deliverable to Gate 3, the decision point that
opens the door to a full-fledged development project
56. Gate 3: Go to Development
This is the final gate prior to the Development
Stage, the last point at which the project can be
killed before entering heavy spending. Once past
Gate 3, financial commitments are substantial. In
effect, Gate 3 means "go to a heavy spend." Gate
3 also yields a "sign off" of the product and project
definition.
57. Stage 3: Development
Witnesses the implementation of the development
plan and the physical development of the product.
Lab tests, in-house tests, or alpha tests ensure that
the product meets requirements under controlled
conditions.
The emphasis in stage 3 is on technical work, but
parallel marketing and operations activities are also
undertaken.
58. Gate 4: Go to Testing
This post-development review is a check on the
progress and the continued attractiveness of the
product and project. 開發階段後的檢視
Development work is reviewed and checked,
ensuring that the work has been completed in a
quality fashion and that the developed product is
indeed consistent with the original definition
specified at Gate 3. 確認開發工作的產出品質,及
符合原始設計規範。
59. Stage 4: Testing & Validation
This stage tests and validates the entire viability of
the project: the product itself, the production
process, customer acceptance, and the economics
of the project.
Provide final and total validation of the entire
project: the commercial product, production, and
marketing.
60. Gate 5: Go to Launch
This is the final gate opens the door to full
commercialization-market launch and full
production or operations start-up. It is the final
point at which the project can still be killed.
61. Stage 5: Launch
This final stage involves implementation of both
the marketing launch plan and the production or
operations plan.
The post-Launch monitoring plan kicks in early in
the Launch stage, while the project’s performance
on key metrics takes place, and the project team
responds with necessary action.
檢討產品上市後是否順利
62. Discovery Market Action
Customer-based idea generation: working with
lead users and key customers is to identify
problems, and to conduct strategic planning
exercises to uncover disruptions and gaps in the
marketplace leading to significant and emerging
opportunities for new solution.
從客戶觀點找出客戶的問題,成為自己的機會
63. Scope Market Action
preliminary market assessment: an early,
relatively inexpensive step design to assess
market attractiveness and to test market
acceptance for the proposed new product with an
Internet search, a library search, contacting with
key users, focus groups, and even a quick concept
test with a handful of potential users. 透過市場研究
過濾出較有可能機會
64. Build Business Case Market Action
market research to determine user needs, wants,
and preferences: in-depth, face to face, and onsite interviews with customers to determine
customer needs, wants, preference, likes, dislikes,
and buying criteria, as input to the design of the
new product. 透過市場研究找出需要,想要,和偏好,
寫成產品報告
65. Development Market Acton
Customer reaction during development: Continuing
concept and product testing through the
development phase, using rapid prototypes,
models, and partially completed products to gauge
customer reaction and seek feedback.
提出快速原型給客戶,讓客戶反映其意見
66. Test & Validation Market Action
User tests: Field trials or beta tests using the finished
product (or commercial prototype) with users to verify the
performance of the product under customer conditions
and to confirm intent to purchase and market acceptance
. 到使用者所在地真實測試看效能/市場接受度
Test market, or trial sells : A mini-launch or “soft launch”
of the product is a limited geographic regions or single
sales territory as a test of all elements of the marketing
mix in a very controlled manner, and measuring
consumer response to the product and its launch.
在特定/有限大小市場試著銷售看反應
67. Launch Market Action
Market launch: a proficient launch, based on solid
marketing plan, and backed up by sufficient
resource. 在完善的上市計畫及足夠資源下上市
75. The Design and Implementation of A New
Product Process
Stage 1: The Foundation: Defining the Process
Requirements
Stage 2: Designing the Stage-Gate New Product
Process
Stage 3: Implementation of Stage-Gate
76. Stage 1: The Foundation: Defining the Process
Requirements
1. Seek senior management commitment
2. Assemble a task force.
3. Hold a "kick-off" seminar/workshop.
4. Conduct an internal audit of current practices.
5. Benchmark other firms.
6. Conduct a thorough literature review.
7. Map the next steps.
8. Secure senior management sign-off.
77. Stage 2: Designing the Stage-Gate New Product
Process
addressed as your detailed Stage-Gate model
takes shape
1. Stage descriptions
2. Deliverables
3. Gate descriptions
4. Gate procedures
5. Organization
6. What’s "in" the process?
78. Stage 3: Implementation
Bringing Projects into the NPP
Getting Commitment and Buy-In
Communicating your NP Process
Provide Training
Develop IT Support for the Process
Metrics-How Well Are You Doing?
A Process Manager
80. Reference:
Cooper, Robert G., Winning at New Products
Crawford, C. Merle and Anthony DiBenedetto, New
Products Management
McQuarrie, Edward F.: The Market Research
Toolbox A concise Guide for Beginners