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Summary ISE New Products Management, ISBN: 9781260575088 Product Innovation Processes (1ZV30) $7.53
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Summary ISE New Products Management, ISBN: 9781260575088 Product Innovation Processes (1ZV30)

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  • Course
  • Product Innovation Processes (1ZV30)
  • Institution
  • Technische Universiteit Eindhoven (TUE)
  • Book
  • ISE New Products Management

Summary of the lecture notes, slides, and course material for the course 1ZV30 in the academic year 2019/2020.

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  • Yes
  • April 6, 2023
  • 48
  • 2019/2020
  • Summary

Subjects

  • product development
  • launch planning
  • sales forecasting
  • testing
  • learning curves

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  • Technische Universiteit Eindhoven (TUE)
  • Industrial Engineering
  • Product Innovation Processes (1ZV30)
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Samenvatting 1ZV30
Inhoud
Chapter One – The Strategic Elements of Product Development ......................................................... 2
Chapter Two – The New Products Process ........................................................................................... 3
Chapter Three - Opportunity Identification and Selection: Strategic Planning for New Products ........ 7
Chapter Four - The Product Concept and Ready-Made New Product Ideas ....................................... 11
Chapter Five - New Product Ideas: The Problem Find-Solve Approach ............................................... 13
Chapter Six – New Product Ideas: Analytical Attribute Approaches ................................................... 16
Chapter Seven – Concept Evaluation and Testing ............................................................................... 17
Chapter Eight – The Full Screen .......................................................................................................... 21
Chapter Nine – Sales Forecasting and Financial Analysis .................................................................... 22
Chapter Ten – Product Protocol.......................................................................................................... 24
Chapter Eleven – Design ..................................................................................................................... 27
Chapter Twelve – Development Team Management ......................................................................... 29
Chapter Thirteen – Product Use Testing ............................................................................................. 32
Chapter Fourteen – Strategic Launch Planning ................................................................................... 34
Chapter Fifteen – Implementation of the Strategic Plan .................................................................... 37
Chapter Sixteen – Market Testing ....................................................................................................... 39
Chapter Seventeen – Launch Management ........................................................................................ 41
Article, Part I Chapter One – TRIZ Tools for Creativity and Clever Solutions ....................................... 43
Article, Part II Chapter Five – Uncovering and Solving Contradictions ................................................ 44
Chapter 1 – Introduction..................................................................................................................... 46
Chapter 2 – Organizational Learning Curves ....................................................................................... 47
Chapter 3.1 – Frameworks for Understanding the Variation in Learning Curves ................................ 47
Chapter 4.1-4.3 - Relative Effectiveness of Experience vs. Deliberate Learning as Sources of Learning
............................................................................................................................................................ 48

,Chapter One – The Strategic Elements of Product Development
Setting
New products can be tangible goods or services. New products can be destined for the consumer
market, the business-to-business market, or both. New product management: managers face the world
as it is, not as they would it to be – downsizing, regulatory actions, competitive moves, the impact of
the new Internet technologies, and even personal problems such as illnesses.

The Importance of New Products
New products are big business. Many managers realize that radical innovation is critical to future
growth and even the survival of the firm. Here, we are defining radical innovation as innovation that
displaces or obsoletes current products and/or creates totally new product categories. The reason firms
invest this much in new products is that they hold the answer to most firms’ biggest problems.
Competitors do the most damage when (1) there is so little product differentiation that price-cutting
takes everyone’s margins away or (2) when they have a desirable new item that we don’t. Another
reason for studying about new products is that the new products process is exceedingly difficult. After
many years of research, we know many of the most important reasons why products fail. The firm
doesn’t understand the customer, or underfunds the required research and development, or doesn’t do
the required homework before beginning development (sometimes called the ready—fire—aim
approach), or doesn’t pay enough attention to quality, or lacks senior management support, or chases
a moving target.

Globalization and New Product Development
Like all aspects of modern business, product development has become more challenging due to
increased globalization. Many multinational firms seek to leverage their product development skills
across their subsidiaries and gain competitive advantage by setting up global new product teams. The
best research available on this topic finds that firms with a global innovation culture have the most
effective global new product programs. Having a global innovation culture means that a firm is open to
global markets, mindful of differences in customer needs and preferences, and respectful of different
national cultural and business environments.

How Product Development Is Different
The new products team ideally is cross-functional, comprising personnel from marketing, R&D,
engineering, manufacturing, production, design, and other functional areas as well. Unlike other courses
you may be taking, we spend much time in this text on how you interact with people from other fields
of study. The tough creativity is to how best to develop and market new product concepts. Process
innovation: usually applies to functions, especially the manufacturing or distribution process, and every
new product benefits from this type of innovation. Product innovation: applies to the total operation
by which a new product is created and marketed, and it includes innovation in all of the functional
processes. Objective: create value for customers by leveraging internal learning and knowledge in order
to have marketing (company visibility, brand availability, advertisement) and economic success (Sales,
Revenue, ROI, Profit). Process of Product Innovation: Stage-gate process provides the blueprint for
structuring the process of product innovation.
Advantage of Stage-Gate
- Better planning and scheduling through short-term goals
- Ensuring the continuous reduction of uncertainty
- Managing uncertainty and risk by a step-wise resource allocation




2

,What Is a New Product, and What Leads to Success?




The Strategic Elements of Product Development
New products process: the procedure that takes the new product idea through concept evaluation,
product development, launch, and postlaunch,
Product innovation charter: can be thought of as a strategy for new products. It ensures that the new
product team develops products that are in line with firm objectives and strategies and that address
marketplace opportunities,
Well-managed product portfolio: helps the firm assess which new products would be the best
additions to the existing product line, given both financial and strategic objectives.
A key point here is that all three of the strategic elements must be in place, and each is coordinated
with, and supports, all the others.

The Basic New Products Process
The idea behind the new products process is that the phases represent activities that are conducted by
the new product team. At these points the hard Go/No Go decisions need to be asked. The goal of a new
products process is to manage down the amount of risk and uncertainty as one passes from idea
generation to launch. Product development is truly multifunctional, where all functions work together
on a cross-functional team to accomplish the required tasks. One way that firms have been able to
avoid delays and speed up time to market is to streamline the evaluation tasks. Another one is that the
team must become involved as early as possible in the new products process. If some key information
is still missing or unavailable, a third option is possible, which we can call an “On decision.” This means
that the project will move forward (a conditional “Go,” if you will), but the missing information must
be gathered and the project could still be halted at a later phase. An evaluation task that includes
conditional Go decisions is sometimes called a fuzzy gate. A related problem occurs when teams
actually make a full “Go” decision, but fail to commit any resources to the project. This is known as a
hollow-gate problem and results in too many projects underway and, inevitably, cost overruns and
launch delays. Another consideration is that the new products process might look very different for
new-to-the-world, breakthrough products as compared to more incremental new products.

Chapter Two – The New Products Process
The Product Innovation Charter (PIC)
The starting point for the turnaround was a clear product innovation charter (PIC), which starts with an
honest situation assessment and opportunity identification. The important thing to know is that it is a
systematic way for managers to develop a new product strategy that considers the goals for their product
innovation efforts and how these efforts fit overall business strategy. It involves identifying a strategic
focus (which markets and which technologies will be targeted).


3

, The New Products Process
A second strategic element is the new products process, which is the path the new product takes from
idea to the time of launch and beyond. P&G’s Cosmetics SBU did not have an effective new products
process in place, with the result that product development often proceeded without clear inputs from
customers early in the process. Voice of the customer or VOC: Think back to this example and
consider how the VOC was used to drive product
development in the Cosmetics SBU.
The New Product Portfolio
In addition to a well-functioning new products process,
there needs also to be an assurance that the firm is
developing the right products with respect to its product
portfolio.

The Phases in the New Products Process
Phase 1: Opportunity Identification
Three main streams of activity:
• Ongoing marketing planning
• Ongoing corporate planning
• Special opportunity planning
From these activities, the opportunities identified sort
naturally into four categories
• Underutilized resource
• New resource
• External mandate
• Internal mandate; product innovation gap
The process of creatively recognizing such opportunities
is called opportunity identification. Once an
opportunity is approved, managers turn to various
techniques to guide new product people in exploiting it.
This we will call the product innovation charter (PIC).
Phase 2: Concept Generation
Creating new product ideas, usually called product concepts by new products people, is not the simple,
fun-and-games thing it might appear.
Phase 3: Concept/Project Evaluation
Before development work can begin on new ideas, they need to be evaluated, screened, sorted out. This
activity, sometimes called screening or pre-technical evaluation, varies tremendously. If the decision
is to go ahead, the evaluation turns into project evaluation, where we no longer evaluate the idea but
rather the plan we propose for capitalizing on that idea. This involves preparing a statement of what is
wanted from the new product. Firms using Quality Function Deployment (a method of project
management and control) see this as the first list of customer needs. A more common generic term is
product description or product definition. In this book it will be called product protocol. Protocol
means agreement, and it is important that there be agreement between the various groups before
extensive technical work gets under way. The lack of good hard information complicates all pre-
technical evaluation. In fact, the first three phases (strategic planning, concept generation, and,
especially, concept/project evaluation) comprise what is popularly called the fuzzy front end.
Phase 4: Development
This is the phase during which the item acquires finite form—a tangible good or a specific sequence of
resources and activities that will perform an intangible service. It is also the phase during which the
marketing plan is sketched and gradually fleshed out.
- Resource preparation: Without adequate preparation of the ball field, a firm doesn’t get much
home advantage.
- The Major Body of Effort: the actual development of, not one thing, but three—the item or
service itself, the marketing plan for it, and a business (or financial) plan that final approval will
require.



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