Journal of Consumer Marketing

SPEEDING YOUR NEW PRODUCT TO MARKET

Milton D. Rosenau, Jr.
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To cite this document:
Milton D. Rosenau, Jr., (1988),"SPEEDING YOUR NEW PRODUCT TO MARKET", Journal of Consumer Marketing, Vol. 5
Iss 2 pp. 23 - 36
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(1990),"Speeding New Products to Market", Journal of Business Strategy, Vol. 11 Iss 5 pp. 34-37 http://dx.doi.org/10.1108/
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(1988),"COUPON REDEMPTION: A MOTIVATIONAL PERSPECTIVE", Journal of Consumer Marketing, Vol. 5 Iss 2 pp.
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SPEEDING YOUR NEW PRODUCT

TO MARKET
Milton D. Rosenau, Jr.
There are several reasons why new products
must be developed faster than before. This article
reviews this changing imperative and describes
several specific techniques that can help shorten
new product development durations.
Introduction
New products must be developed faster than
ever before. As is well known, new products
can be developed using an appropriate sequence
of phases. Accelerating this process requires
that each phase be shortened and that lost time
between phases be eliminated.
The Importance of Timely New
Product Development
Today, the development of a new product
must be completed faster than ever before. This
urgent need is primarily caused by increasingly
shorter product life cycles, as well as the
opportunity to both increase profits and to reduce
development costs, and the advantage of focusing
development work on a stationary target.

Milton D. Rosenau, Jr. is a Certified Management Consultant, and heads Rosenau Consulting Company, which he
founded in 1978. This company is a specialized management consulting firm helping clients move profitable new product
ideas to market as quickly as possible. Clients have included many Fortune 500 corporations. In addition to management
consulting services, Rosenau Consulting Company offers management training seminars, which have been acclaimed
internationally by thousands of participants; and many of his popular seminars are available in videocassettes.
Previously, Mr. Rosenau was Vice President of Science & Technology for Avery International. Preceding that, he was
Vice President & General Manager of Optigon Research & Development Corporation, and prior to that he spent seventeen
years in management, marketing, and engineering positions with The Perkin-Elmer Corporation. Rosenau's personal
background includes successful product development for consumer and industrial markets.
Mr. Rosenau's degree in Engineering Physics from Cornell University has been followed by management programs at
MIT, Cornell, and UCLA. He is the author of four books, including Innovation: Managing the Development of Profitable
New Products and Project Management for Engineers.

Vol. 5 No. 2 Spring 1988 23

 THE JOURNAL OF CONSUMER MARKETING

Consumer product companies, such as Sara

Shorter Product Life Cycles
Product life cycles are getting shorter.
The Evidence
First, there are research data. The clearest
evidence is summarized in Table 1, which
dramatically demonstrates increasingly short-
er product life cycles. 12 While this study
only measures the life cycles of 37 household
products, it is empirical, scientifically rigor-
ous, and covers a span of nearly six decades.
Two other research studies state "...life
cycles a r e getting s h o r t e r " 4 and " . . . t h e
life cycle for most product types is becoming
shorter." 1 1 Finally, a study of strategy and
market forces says "(Product life cycles)
are getting shorter...." 5
Reasons for Shorter Product Life Cycles
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Lee, Ralston Purina, and Frito-Lay, have omitted
the once sacrosanct test marketing to save
time. 1 At the other end of the technology
spectrum, Bobby Inman, the first head of
Microelectronics and Computer Corporation,
recently resigned to explore other means to
move laboratory research to the market more
quickly. Actions by other corporations under-
score the importance of timely new product
development. For instance, in February, 1986,
Eastman Kodak reorganized its research and
development operations in an effort to speed
product development. 2 Two years earlier, "to
get the machines to market quickly and at a
lower cost, Xerox gutted an overgrown bu-
reaucratic structure...." 2 1

Table 1 There is broad agreement that rapidly changing

technology and improved mass communications
are two important causes of shorter product life
Product Life Cycle Data cycles: "...rapid development of new technology,
aggressive marketing, and the willingness of
Number Introductory Growth buyers to try new products;" 5 "the rapid rate of
technological change, plus the easy availability
Of Stage Stage
of credit and the power of mass communications
Household Duration Duration
and advertising;" 7 " . . . t h e increasing pace of
Period Products (Years) (Years)
technological innovations and the rapid rate of
new product introduction;" 11 and "...the ever-
1922-1942 12 12.5 33.8 increasing pace of technological change means
these 'windows (of opportunity)' are opening
and closing at a faster rate. Not getting an early
jump can mean missing an opportunity." 25
1945-1964 16 7.0 19.5 Improved communications have an impact
because information about the newest n e w
product reaches the intended user or purchaser
faster, which promotes an earlier switch away
1965-1979 9 2.0 6.8 from the existing product. For example, modern
advertising (television or other) and more effective
public relations effort provide faster communi-
cation of features and benefits.

Second, there are judgments of informed
people. A recent article 1 reports "Marketing
consultants say product life cycles are short-
ening every year." Another article 7 quotes
Illinois Institute of Technology's dean of the
business school: "I can't document it, but
every industry we look at seems to be under-
going shorter cycles." These comments are
typical.
Third, there are actions taken by practitioners.
Rapidly changing technology also makes it
easier to develop an innovative new product
that offers advantages to users. This change
can make the existing product obsolete. Some
companies have fallen into the "mature product
trap," which makes it more likely that others
will exploit changing technology. This trap can
arise when a company has a "cash cow" that it
is milking. However, when technology is changing
the company must make a choice: Stick with the
existing technology — in which case the company's

24
 SPEEDING YOUR NEW PRODUCT TO MARKET

cash cow may be made obsolete by a competitor to interest saving for a program costing $100,000
who successfully exploits the new technology; per month for various intended durations and
or adopt the new technology first, and make costs of money. Fast development is clearly
your own product obsolete sooner than you would less costly.
otherwise wish. Assuming there is a profitable
business available to a competitor exploiting
some new technology, that same business op-
portunity is available to you. If the new technology Table 2
is going to render your investment in some existing
technology obsolete, this can occur regardless Interest Expense Saved (In Thousands Of
of whether you or a competitor exploits the new Dollars) By Shortening A New Product
technology. Development One Month, Assuming
Program Expense Is $100,000 Per Month
Increased Profits and Reduced Costs
There are two financial reasons to develop
the new product quickly: You can earn more
money; and it is likely to be less expensive.
Increased Profits
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If you can develop and introduce your n e w 0.5 1.0 1.5

product quickly, you can obtain more total
sales, h e n c e more profits. Also, if there is
no initial competition, you may be able to
charge a premium price. W h e n a competitor
introduces a similar product or another way
to perform the same function, some sales
are lost. Thus, getting to the market before
there is direct or functional competition will
increase your total sales.
Reduced Costs
Consider the following specific case. You
have a n e w development effort for which
the expense is $100,000 a month (clearly
artificial, but helpful to simplify calculations),
which is planned for 30 months. Assume
money costs your company 1% per month.
At the end of 30 months, the interest expense
alone will be $513,270. An unplanned 31st
month adds $36,130 interest plus an addi-
tional $100,000 of expense.
The corporation's limited resources
have to be concentrated on the best
opportunities.
Even if the planned $3 million for the devel-
opment effort is not exceeded (that is, if it
is merely spread out over a longer period
of time), there is an increased penalty due
to the cost of money. Table 2 summarizes
the value of one month's time reduction due
1 6.16 12.68 19.59
2 12.72 26.97 42.95
3 19.67 43.08 70.91
4 27.05 61.22 104.35
Your company may be in the fortunate position
of not having to borrow money to fund its new
product development efforts. Even so, the line
of reasoning about the extra interest cost is
still pertinent because your company is fore-
going income that could be earned if the money
were freed up for investment elsewhere. The
key point is that a longer new product devel-
opment effort costs more than a short one.
Stationary Target
It is desirable to aim at a "stationary target."
That is, you don't want any big changes to occur
in the market for which your new product is
intended while you are still developing it, as
shown in Figure 1. Since many markets are
themselves subject to rapid change, it is important
to develop your new product before these changes
render your new product obsolete or irrelevant.

25
 THE JOURNAL OF CONSUMER MARKETING
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Consider car model redesign, which typically
requires several years. The 1987 models of
General Motors's luxury cars became available
for consumer purchase when gasoline was selling
for less than $1 per gallon. However, the models
were specified and designed years earlier, at a
time when gasoline prices were forecasted to
be $2 per gallon for the period in which the
models would be sold.9
Phases that Permit Fast New
Product Development
A phased approach is basically a logical flow
of carefully sequenced activities that move a
new product idea or concept toward successful
market introduction.8,10,23 To facilitate fast new
26
product development, it is necessary to stress
speed during each phase and to avoid wasted
time between the phases. The general concept I
advocate employs four main phases — feasibility,
development, launch and maintenance — each
of which has specific goals.
What Is A Phased Approach?
It is easier to introduce this notion by turning
the question around. The phased approach is
not some magic template that you can blindly
copy and apply to your company's new product
development process. However, you can construct
your company's phased approach from the ideas
here, but it will have to be tailored to your
situation.
 SPEEDING YOUR NEW PRODUCT TO MARKET
The goal of a phased approach is to obtain
profitable product sales quickly and with the
lowest possible risk. A concomitant of a phased
approach is that there has to be a way to discard
less promising new product development efforts
so that your company's limited resources can be
concentrated on the few most promising efforts.
Most phased approaches to new product
development have time sequences as depicted
in Figure 2A. In this situation, there is a time
gap between phases (whatever their specific
content). In those situations where a shorter
development duration is desired, phases are
frequently overlapped, as shown in Figure 2B.
Obviously this overlap increases risk. Recently,
even overlap of several phases has been advo-
cated,22,24 as shown in Figure 2C; this approach
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only seems practical where the development
team has previously developed a product similar
to the one now being produced.
In distinction to these three concepts, I propose
shortening the total new product development
process by having short, sequential phases, as
illustrated in Figure 2D. This has lower risk
than overlapped phases. "Dead time" between
phases is eliminated to shorten the overall
process. The shorter phases, in which the
required work is completed very quickly, are
realistically achievable by using the techniques
described below.
Finally, I propose separating the feasibility
work and the maintenance work from the time-
critical new product development process. These
27
 THE JOURNAL OF CONSUMER MARKETING
two phases are important, but the first — feasi-
bility — cannot be rigidly scheduled. The latter
— maintenance — does not start until the new
product is introduced.
How Can A Phased Approach Be Fast?
There are four hallmarks of a fast phased
approach: management authorizations at the start
of each phase (and every three months for phases
longer than that); a series of shorter phases
with clear and limited objectives; specific actions
to make each phase as fast as possible, including
shortcuts, the use of appropriate project man-
agement techniques, installation of productivity
enhancements, proactive promotion of interde-
partmental teamwork, and undistracted dedica-
tion of the team working on the new product
development program; and prompt approval to
initiate a subsequent phase at the successful
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conclusion of the previous phase (or disapproval
and discontinuance of the new product devel-
opment program).
Management Authorization
The first component is management authori-
zation for each new product development
effort. The level of management that provides
this approval must have discretionary com-
mand of enough corporate resources to
provide a reasonable assurance of success.
This is important for two separate reasons.
First, the corporation's limited resources have
to be concentrated on the best opportunities.
Second, management authorization to start
a new product development effort should
assure that that effort will continue to have
support as long as adequate progress is being
made.
If management must authorize
the initiation of a new product
development effort, there has to be an
awareness of how much effort is
presently under way.
There is another aspect of management
authorization, namely involvement and aware-
ness. That is, if management must authorize
the initiation of a new product development
effort, there has to be an awareness of how
much effort is presently under way. The
visible involvement of management in the
new product development process can pro-
28
vide stimulation and may increase motivation.
Short Phases
A short phase contains a collection of some
— but not all — of the many development
activities required for ultimate success. The
larger total effort is thus subdivided into a
series of smaller undertakings, each of which
is a phase. Each phase has specific and
very limited objectives; only those activities
required to accomplish the immediate phase
objectives are included. Conversely, there
is usually some imprecision in the goal of a
new product development when it starts, as
shown in Figure 3. The idea is to start a
phase with high confidence that it can be
completed successfully and quickly.
A short phase can be more sharply focused
and better planned than a long phase or an
un-phased program. When a long period of
work is authorized, there inevitably are people
who invest time in tangential efforts, and there
is less sense of urgency.
Specific Actions To Make Each Phase Fast
There are five actions that can shorten the
length of each phase: shortcuts; the use of
project management tools; productivity en-
hancements; proactive promotion of inter-
departmental teamwork; and dedication.
First, shortcuts include steps you can skip,
elaborations you can avoid, and similar
omissions that reduce the work you must
do. There is always some risk when using
shortcuts. It is also obvious that some
activities, such as obtaining regulatory
approvals, cannot be omitted, in fact, the
time for this may be outside your control or
even your influence.
Second, project management tools can help
achieve a performance objective within a
time schedule and a cost budget. Since each
new product development phase has a spe-
cific objective, project management method-
ologies can be adopted. That is, each phase
is a project. Unfortunately, at least in the
minds of some people, project management
connotes massive construction projects or
costly overruns on elaborate aerospace pro-
jects. Nevertheless, project management
methodologies can be applied to new prod-
uct development with low cost and low
complexity.13
 SPEEDING YOUR NEW PRODUCT TO MARKET
As an example, a critical path network
schedule (which is sometimes mistakenly
called a PERT chart or PERT schedule) will
almost always help shorten the phases of a
new product development effort.6 A critical
path network schedule — in distinction, for
instance, to a bar chart schedule or list of
scheduled milestones — is so valuable that
its use is almost essential to the accomplish-
ment of fast product development and in-
troduction.18 Clearly, there is a cost to using
these, but as long as that cost is less than
the cost of misapplied resources or a late
new product development project, then it is
a favorable tradeoff. Today, you can use
microcomputer-based project management
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software to help assure that each phase is
completed quickly.15,16,17
Third, there are a variety of productivity
tools that can shorten the new product
development process. Computers and various
computer-controlled tools provide the means
to greatly improve personal and manufac-
turing productivity, which can help your
staff do more in less time. As a practical
matter, productivity tools are themselves
rapidly developing new capabilities and
utility, so you must investigate the state-of-
the-art when you consider their adoption.
Fourth, proactive promotion of interdepart-
mental teamwork is important. It is well
29
 THE JOURNAL OF CONSUMER MARKETING
known that the existence of disharmony
among different functional departments is
correlated with new product failure.1920 Also,
where relations are uncooperative or hostile,
more time must be spent working on "people
problems," which reduces the time and
energy available to make progress on the
new product development program itself.
Thus, active prevention (or reduction) of
disharmony is useful.
When a long period of work is
authorized, there inevitably are people
who invest time in tangential efforts,
and there is less sense of urgency.
Fifth, a dedicated team that has no other
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assignment will not be distracted from the
new product development effort. This is one
reason why a separate maintenance phase
is helpful, since it removes "fire-fighting"
activity from immediate attention. A special
group (typically called the sustaining or
continuing engineering group) can be es-
tablished to support existing products, thus
reducing the intrusion on people working
on the introduction of additional new prod-
ucts. Also, the development team can be
isolated from distraction in a "skunk works,"
which may also enhance motivation.
Prompt Initiation of Subsequent Phases
Normally, timely approval to initiate a sub-
sequent phase is provided at the successful
conclusion of the previous phase. Fast new
product development requires that the ap-
provals be granted (or denied) promptly.
Thus, when a short phase is authorized, not
only is there a schedule for the phase, but
also a schedule for the review meeting that
will conclude the phase.
Other Benefits of a
Fast Phased Approach
Urgency
The phased approach reduces the time to
introduce a new product because of increased
urgency. Not only are the participants more
likely to have a better schedule plan for a short
phase, they are also less likely to let the clock
run without making progress. It is hard to let
the first month of a three month or six month
30
phase slip by without making progress. Con-
versely, participants often exhibit low schedule
urgency at the start of a three year new product
development effort.
Improved Understanding
Comprehension of the participants is improved.
It is much easier to understand a short-term
program and the steps in it than to understand a
much longer, and necessarily more complex,
program. Only certain things have to be accom-
plished in a single phase. Distraction is reduced
because it is not necessary to deal with unrelated
future activities. Thus, a short phase is easier to
understand than the entire new product devel-
opment process.
Focus
A phased approach helps concentrate a cor-
poration's limited resources on a small number
of prospectively important new product devel-
opment efforts, as illustrated in Figure 4. It does
this by providing a specific understandable focus
for work or effort. The phased approach provides
limits to open-ended commitments. Thus, it helps
everybody make the toughest new product
development decision of all, namely the decision
to kill or suspend less promising efforts. If only
a phase or two has previously been approved,
rather than the entire effort, it is easier not to
approve a subsequent phase. Then, resources
can be reallocated and applied to more rewarding
efforts.
Reduced Risk
Short phases have lower risk. Not only is the
schedule riskless, but the financial risk is also
less. Only small development increments are
approved at any given time. Consequently, the
work that has been approved is a limited, specific
effort, so there is less temptation to change
specifications in a short phase. Approving a
phase does not guarantee that subsequent phases
must be approved. Clearly, one does not approve
a phase without an expectation that subsequent
phases will be approved. However, if the goals
of an approved phase can not be achieved, then
subsequent phases do not have to be approved.
In fact, the goals of a specific phase on a particular
new product development effort might, in fact,
be achieved satisfactorily, but approval of the
next phase can still be withheld to reallocate
resources. This is in contrast to approving the
entire development project at the beginning. In
the latter case, there is both a long period of
 SPEEDING YOUR NEW PRODUCT TO MARKET
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time for the entire development cycle as well as
a large amount of money, with less assurance
that the time and money will be efficiently used.
Risk is also reduced because there is a separate
feasibility phase. With a phased approach,
subsequent development phases are not de-
pendent upon making inventions on a pre-set
schedule. That is, the feasibility phase efforts
are designed to produce a series of proven
concepts and demonstrations. The inventions
are made in the feasibility phase and then
stockpiled, awaiting use in subsequent develop-
ment activities. In some cases, the development
phase may have to be deferred until a clear and
convincing feasibility effort is successfully
concluded; but it is less costly to postpone a
new product development program until there
is proven technology upon which to draw.
Proposed Phases
In broadest overview, I suggest four main
phases in the development of a new product:
feasibility, development, launch, and mainte-
nance. Obviously, this sequence of phases must
be preceded or initiated by an idea for a new
product. This idea may range anywhere from a
vague notion to a specific and detailed con-
struction. Generating this idea may require time
and effort, but I am dealing only with the process
and time following an idea's articulation. In fact
one expert, Theodore Levitt, has said, "The fact
that you can put a dozen inexperienced people
into a room and conduct a brainstorming session
that produces exciting new ideas shows how
little relative importance ideas themselves actually
have."3
A general view is shown in Figure 4 (in which
31
 THE JOURNAL OF CONSUMER MARKETING
the specific numbers at the bottom depicting
the number of ideas and relative cost are meant
to be conceptual rather than exact). This high-
lights four other aspects of the phased approach:
you filter out less promising efforts as you move
progressively through the phases, which helps
concentrate your company's limited resources
on the better opportunities; you can afford this
selectivity because the earlier phases have much
lower costs than the later phases; all departments
or functions may be involved in each phase; and
higher levels of management approval are re-
quired as the cost risks increase. Three other
points are also illustrated: ideas can arise
anywhere; you might (although rarely) kill a
new product effort that was in the launch phase;
and there is usually a gap after the launch phase
ends and a maintenance phase project starts.
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Table 3 indicates these phases, but also shows
a total of six phases. The reason for the two
extra phases (or, more precisely, sub-phases) is
that I believe it is helpful to divide the total
development phase, which is frequently lengthy,
into two shorter sub-phases, namely optimiza-
tion and design, to provide sharper focus.
Similarly, it will often be helpful to separate the
launch phase into preproduction and production
sub-phases.
A tightly scheduled new product development
effort is one in which the allowable schedule
for each of the phases is as short as possible
and where there is no time gap between the end
of one phase and the start of a successor, as
was illustrated in Figure 2D. To put this somewhat
differently, one of the activities during a phase
is to be assured that appropriate management
personnel are suitably aware of the project's
status so that only one management meeting is
required to both approve the end of one phase
and authorize the initiation of the successor.
Authorization of a feasibility phase effort is
not a commitment to launch a new product or
even to undertake the development phase. The
optimization sub-phase is separated from the
design sub-phase, within the overall development
phase because it is impractical, if not impossible,
to schedule or budget the design work until the
product specifications have been set. Clearly, it
is possible to omit the optimization sub-phase if
the product specifications are obvious and no
market research is required before design work
is initiated.
32
Undertaking the optimization sub-phase is
normally — but not necessarily — a commitment
to undertake the design sub-phase. However,
undertaking the development phase does not
constitute a commitment to launch the product,
even though there may be a schedule for a
proposed market introduction. Preproduction
activity normally is a commitment to produce.
The phased approach reduces the time
to introduce a new product because
of increased urgency.
The crucial phases for fast new product
development are the development and launch
phases in the sense that these can easily be
shortened. The feasibility phase, as vital as it
may be, may require an invention or technical
breakthrough, which cannot be scheduled. The
most that can be done is to identify that re-
quirement, provide resources, and develop a
sense of urgency.
When you establish a phased approach such
as this, you must always permit an "escape
clause" if the new product itself can't fit this
exact methodology. For instance, any phase can
be extended or "recycled" even though this may
be a signal indicating the effort is seriously off
track. Similarly, any phase can be omitted. In
your own company, because of your market
situation, competition, or corporate culture, the
proposed phases can be combined and/or divided
differently to provide a procedure which is most
useful in your own organization. In some situa-
tions, the risk versus schedule trade-off may
favor increased risk to try to achieve a shorter
schedule. For example, it may be desirable to
authorize the purchase of certain long-lead items
required for the next phase before the current
phase is concluded. When this purchase is
authorized, it is not authorization for the entire
next phase; in fact, the next phase might not be
authorized despite the previously authorized
purchase.
Feasibility Phase
The goal of the feasibility phase is to eliminate
technical unknowns. Technological investigations
are authorized, typically in the research and
development (R&D) department, consistent with
overall corporate strategy and especially the
market strategy for the business areas in which
 33
Table 3
Overview: Moving Profitable New Product Ideas To Market As Quickly As Possible

PHASE FEASIBILITY DEVELOPMENT LAUNCH MAINTENANCE

OPTIMIZATION DESIGN PREPRODUCTION PRODUCTION

GOAL Proven technology Understanding of product Working prototype and Ready for actual production. Product ready for sale. Problem resolved.
feature versus price largely finished design
tradeoffs. data.
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START Basic corporate business Marketing and technical Top management decision Top managment approval Satisfactory end of User, customer, or sales
POINT strategy and priorities. decision that there Is an based on marketing and of joint recommendation preproduction work. problem.
Markets, products and attractive market technology recommen- from marketing, tech-
SPEEDING YOUR NEW PRODUCT TO
technologies known. MARKET
opportunity. Plausible dation. nology, production.
Profit and sales targets idea for new product.
known.

KEY Technology Critical Secondary market research Product's promotion basis Final product name Initiate production. Limited quick fixes
ACTIVITIES Laboratory experiments, and test marketing or developed. selected. Advertising to where cost or quality
breadboards, analysis. primary market research trade and users planned. Complete service and justified.
completed. Musts and Preproduction prototypes Sales and distribution training manuals.
Process Critical wants clearly defined. built or pilot line plans completed.
Bench & pilot scale Market segments and operated.
trials. competition understood. Complete all sales
Completion of designs, support materials,
Production cost estimates parts list, scale up, advertising, and other
Market Critical Technical trade-off and schedule completed. formulas, quality promotion.
Exploratory market studies, including crude assurance plan, technical
research. production cost estimates. service requirements,
Discounted cash flow
analysis. test specificiations and
vendor qualifications.
Compare balance of
development investment Obtain final regulatory
to alternative resource compliance, if required.
use options, perhaps
using screens. Order long-lead tooling.

ROLE OF Critical path network Critical path network Critical path network Critical path network schedule Critical path network
PROJECT schedule of activities schedule and budget for schedule and development schedule and budget for
MANAGEMENT to be performed, entire phase. budget, including contin- each sustaining engineer-
typically should cover gency, to meet marketing ing or technical support
3-0 month segments. specifications. effort

KEY Continue to invest In or Select most attractive Whether launch phase is Production methods, Production rates, Authorization of a new
DECISIONS drop exploration. combination of product justified. tooling design, and inventory levels, product (improvement)
attributes for initial vendor selections. and similar issues. development program,
market introduction of when justified.
product.

END Initiate development if Specification of optimum Authorize launch, or kill Marketing and production Routine shipping. Completion of effort or
POINT technology is proven, or product features. and document; or, in rare approval to produce, initiation of a product
continue exploration, or cases, extend dovelopment improvement development
kill and document work. phase for a short time. program.
 THE JOURNAL OF CONSUMER MARKETING
the corporation wishes to engage. Unfortunately,
some companies commit to a product introduction
date before feasibility is proven, and then miss
the date.
Because there are substantial technical un-
knowns during feasibility phase efforts, it is not
possible to schedule dates on which specific
results will be obtained. Rather, the activities
that are to be carried out are scheduled, but
there can be no assurance that any of these
experiments will be successful. A critical path
network improves scheduling these activities.
What you should expect to obtain from suc-
cessful feasibility work are varied and plentiful
proofs of concepts. These feasibility demonstra-
tions include development of new bench chem-
istry formulas, breadboard models, sample lots
of new and similar demonstrations. The key
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decisions which the head of R&D must make, in
conjunction with other executives, is how long
to continue a given line of exploration. Each
successful (and unsuccessful) result must be
documented clearly and completely, in language
that is comprehensible to both engineering and
marketing personnel, who must make use of it.
Development Phase
The development phase is undertaken only
when there is a belief that solutions exist to all
technical problems. If there are major unknowns,
it is impossible to schedule realistically a market
introduction date, so the sensible course of action
is to initiate a feasibility phase effort. Therefore,
when you undertake a development phase, it is
possible to have a schedule for product shipment;
however, the commitment to undertake the launch
phase is not, in fact, automatic. The development
phase is normally completed when the marketing
department agrees that the design is satisfactory,
even though the authorization for the launch
phase may require additional managerial approval;
ideally, no time is lost between the end of the
development phase and the start of the launch
phase.
The reason to break the development phase
into separate optimization and design sub-phases
is to assure that the much more expensive and
time-consuming design activity is focused on an
optimum combination of product features. Product
features, or attributes, include technical and/or
performance characteristics and the selling price
(which is frequently translated into an allowable
34
factory cost). The optimization sub-phase can
be initiated when there is a plausible idea for a
new product that will satisfy an attractive market
and for which there is no substantial unproven
technology.
One of the most important activities in the
optimization sub-phase is to define explicitly
the "must" and "want" attributes of the new
product. This requires a clear understanding of
the market and competition. Secondary market
research must be completed during the optimi-
zation phase, if not earlier, so that test marketing
or other primary market research can also be
completed.
Optimization work can be scheduled quite
precisely. Because this typically involves highly
interdependent work of the marketing and
engineering departments, a critical path network
schedule is usually very important to assure
that the phase is completed quickly. It may be
very important to have early crude models
(breadboards). These might be made with paper
or cardboard to help convey key working prin-
ciples of the product, to assure that the market
research is insightful.
Participants often exhibit low schedule
urgency at the start of a three year
new product development effort.
Assuming that there is an attractive combi-
nation of achievable product attributes at a
realistic production cost, it is then appropriate
to undertake the design sub-phase. While this
may require complex and challenging work, it
can and must be tightly scheduled. However,
because it typically has somewhat greater
complexity than the optimization sub-phase, it
is appropriate for the critical path network
schedule and development budget to have both
time and cost contingencies. The amount of these
contingencies are obviously a trade-off with the
risk that the development schedule or budget
will be missed. How this trade-off should be
made depends on the competitive situation and
the extent to which early commitments have to
be made to a specific introduction date.
The end of the design sub-phase can only
occur when there is sufficient information to
permit a discounted cash flow analysis. The
 SPEEDING YOUR NEW PRODUCT TO MARKET

really big expense usually occurs during the
launch phase, including such things as tooling
or even new production plants. The commitment
to dedicate corporate resources to these very
expensive undertakings should never be made
lightly. While there can never be any complete
guarantee of ultimate success, it is crucial to
minimize the likelihood of committing major
resources to a program that is unlikely to have
an acceptable financial return."
Launch Phase
The launch phase ends when the product has
achieved routine shipping status. The principal
reason to separate pre-production from production
is to minimize any premature expenditures, but
this depends on the specifics of the products.
The goal of the preproduction sub-phase is to
have absolutely everything in order so that the
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to dedicate talented resources to the maintenance
and support of a product. If your company has a
group of people separately dedicated to per-
forming this important function, you can avoid a
situation in which R&D, engineering and/or
manufacturing personnel are pulled away from
the forthcoming new products. Ideally you do
not want these other new product development
programs to be delayed to support existing
products.
Thus, it is probably better to have a separate
department charged with responsibility to support
products that have achieved routine shipping
status. Each time a problem with one of these
products is identified, a maintenance project
Authorization of a feasibility phase
effort is not a commitment to launch

production sub-phase can be carried out in an

efficient and cost-effective way. Thus, all of the
work, such as detailed designs, test specifications,
chemical formulas, and similar items required
to permit a manufacturing release must be
completed. The pre-production sub-phase ends
when the marketing department specifies the
initial production lot sizes and the manufacturing
department accepts this.
Maintenance Phase
This phase is necessary because, inevitably,
there are user, customer or sales department
problems when a new product is introduced to
the marketplace. Unless your company's policy
is "use voids warranty," you are going to have
a new product or even to undertake
the development phase.
should be authorized, and a schedule and budget
for it should be made. In some cases, this will
lead to a "quick fix" with the present product,
and in other cases will also lead to the initiation
of a subsequent totally different new product
development effort.
Summary
New product development programs can be
completed faster if you adopt a phased approach
embodying the ideas and mechanisms described.

END NOTES
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July 10, 1986, p. 25.
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58-59.
3. Buttrell, F., Technology to Payoff: Managing The New Product From Creation to Customer.
Philadelphia: Cresheim Publications, 1984, p. 55.
4. Clark, W., H. Freeman, and D. Hanssens, "Opportunities for Revitalizing Stagnant Markets:
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4, December 1984, pp. 242-254.
5. Cravens, D. W., "Strategic Forces Affecting Marketing Strategy," Business Horizons, September-
October 1986, pp. 77-88.

35
 THE JOURNAL OF CONSUMER MARKETING

6. Dusenbury, W., "CPM for New Product Introductions," Harvard Business Review, July-August
1967, pp. 124-139.
7. Fraker, S., "High Speed Management for the High-Tech Age," Fortune, March 5, 1984, p. 62ff.
8. Management of New Products. Booz, Allen & Hamilton, 1968.
9. Mitchell, R., "GM's New Luxury Cars: Why They're Not Selling," Business Week, January 19,
1987, p. 94ff.
10. New Products Management for the 1980s. Booz, Allen & Hamilton, 1982.
11. Onkvisit, S., and J. J. Shaw, "Competition and Product Management: Can the Product Life
Cycle Help?" Business Horizons, July-August 1986, pp. 51-62.
12. Quails, W., R. Olshavsky, and R. Michaels, " Shortening of the PLC — An Empirical Test,"
Journal of Marketing, Vol. 45, Fall 1981, pp. 76-80.
13. Rosenau, M. D., Jr., Successful Project Management. Belmont, CA: Lifetime Learning Publications,
1981.
14. Rosenau, M. D., Jr., Innovation: Managing the Development of Profitable New Products.
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Belmont, CA: Lifetime Learning Publications, 1982.

15. Rosenau, M. D., Jr., "Microcomputer Software for Project Management." Atlanta: The Association
for Media-based Continuing Education for Engineers, Inc. (AMCEE), 1985.
16. Rosenau, M. D., Jr., "Software Can Help You Manage R&D Projects," Research & Development,
November 1985, pp. 86-88.
17. Rosenau, M. D., Jr., "Software Packages that Make Good Managers Better," Journal of
Management Counsulting, Vol. 3, No. 1, 1986, pp. 52-58.
18. Rosenau, M. D., Jr., "Planning Without Pain," Chemtech, May 1985, pp. 288-292.
19. Souder, W., "Disharmony Between R&D and Marketing," Industrial Marketing Management,
November 1981, pp. 67-73.
20. Souder, W., Managing New Product Innovations. Lexington, MA: Lexington Books, 1987, pp.
161-178.
21. The New York Times,"Kodak Alters Research Setup," February 27, 1986.
22. Takeuchi, H., and I. Nonaka, "The New New Product Development Game," Harvard Business
Review, January-February 1986, pp. 137-146.
23. Urban, G. L., and J. R. Hauser, Design and Marketing of New Products. Englewood Cliffs, NJ:
Prentice-Hall, 1980, pp. 31-60.
24. Uttal, B., "Speeding New Ideas to Market," Fortune, March 2, 1987, p. 62ff.
25. Warren, A., "The Innovation Traps," Industry Week, September 17, 1984, p. 48ff.

36
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