Managers use organizational structures and processes like cross-functional teams and stage-gate systems to oversee new product development. Cross-functional teams are relieved from other duties and given budgets, timeframes, and informal workplaces to focus on developing new products through each stage. Stage-gate systems divide the innovation process into stages with gates at the end of each, requiring project leaders and cross-functional teams to deliver outcomes before advancing to the next stage. Budgeting strategies include funding as many projects as possible to achieve some winners, matching competitors' spending, or estimating required investment based on the number of successful new products needed.

1. What organizational structures and processes do
managers use to oversee new-product
development

2. An organizational structure defines
how activities such as
task allocation ,
coordination
supervision are
directed towards
the achievement of
organizational aims

3. Many companies use customer-driven engineering
to develop new products, incorporating customer
preferences in the final design

4. Some rely on internal
changes to develop
more successful new
products.

5. Budgeting for New-Product Development

6. finance as many projects as possible,
hoping to achieve a few winners.
spend what the competition spends.
decide how many successful new products
they need and work backward to estimate
the required investment
Mostly 3 strategies are followed

7. Stage
Number
of Ideas
Pass
Ratio
Cost
per Idea Total Cost
1. Idea Screening 64 1:4 $1,000 $64,000
2. Concept Testing 16 1:2 20,000 320,000
3. Product Development 8 1:2 200,000 1,600,000
4. Test Marketing 4 1:2 500,000 2,000,000
5. National Launch 2 1:2 5,000,000 10,000,000
$13,984,000

8. Organizing New-Product
Development

9. CROSS-FUNCTIONAL TEAMS
relieved from other duties and given a budget
, time frame and a informal workplace

10. Divide the innovation process into stages , with a gate at the end
of each
The project leader , working with a cross-functional team, must
bring a set of known deliverables to each gate before the project
can pass to the next stage.
STAGE-GATE SYSTEMS