CHAPTER 1
Opportunity Identification
Company within a Company
- a group of people who lead the
development of a new product
New Strategy Inputs and Identifying
Opportunities
- Explicit consideration of the role of new
products in the organization is strongly
related to success
Product Platform Planning
- A product platform is defined as a set of
systems and interfaces that form a
common structure. It is from this
common structure that a family or a
stream of products can be developed
efficiently.
- a platform can be a technology, a design
a subsystem, or anyone that can be
shared by one or more product families.
Bottom-up platform procedure
- a strategic way to consolidate
components within an existing family of
products to gain scale economies.
Top-Down platform procedure
- this platform was designed at the outset
to become the basis for a family of
products, possibly for years into the
future.- In other term, they started to
design a product that can
be in long-term use and can be the
basis of their product brand.
Brand platform
- a synthetic document designed to
compile all the elements that make up
the DNA of your brand, both visually and
ideologically
brand equity.
- the value of an established brand
- new opportunities can come from many
different sources: underutilized or new
resources, mandates originating
external to the firm
Identifying the “Greenfield Markets’’
1. Find another location or venue
2. Leverage your firm’s strengths in a new
activity center.
3. Identify a fast-growing need, and adapt
your products to that need.
4. Find a “new to you” industry
Recommendations for scouting for such
opportunities:
1. Recommendations for scouting for such
opportunities:
2. Find fringe markets that are becoming
mainstream
3. Find bottlenecks in the flow of trade,
and seek to eliminate them.
4. Look for “ripple effects” on business
opportunities.
Find Opportunities as Derived from Social
Trends
Trend 1: Just in Time Life
Trend 2: Sensing Consumers
Trend 3: The Transparent Self
Trend 4: In Search for ‘Enoughness’
Trend 5: Virtual Made Real
Trend 6: Co-Creation
Non-Corporate Strategic Planning
- comes from the heads of the functions
in the firm—marketing, technical,
manufacturing, and finance, and from
the planning of suppliers, customers,
and others. Such groups frequently
have the power to affect new product
work.
Miscellaneous Sources
- some inputs can start at the lower level
of activity and influence upward, as
when a new product is so successful it
drives corporate strategy to change.
The Product Innovation Charter (PIC)
- It is a document prepared by senior
management designed to guide the
business unit on the role of innovation.
Product Innovation Charter
1. Background - Key Ideas from the
situation analysis
2. Focus - One clear technology
dimension or one clear market
dimension
3. Goals-Objectives - What the project will
accomplish, either short-term as
objectives, or long-term as goals.
4. Guidelines - requirements imposed by
the situation or by upper management.
Sections of the Product Innovation Charter
(PIC)
● Background Section - answers the
question: “Why did we develop this
strategy, anyway?” To the extent
necessary, it recaps the analysis behind
it.
● The Arena (Area of Focus) Section -
In today’s competitive marketplaces, it
takes focus to unlock the necessary
power of innovation.
Focus is generally achieved by the use of four
types of strengths or leverage capabilities:
- Technology
- product experience
- customer franchise
- end-use experience
● Goals and Objectives Section - the
standard definition is that goals are
longer-range, general directions of
movement, whereas objectives are
short-term, specific measures of
accomplishment.
Both goals and objectives are of three
types:
● Profit
● Growth
● market status
● Special Guidelines Section of
the PIC - First to Market
State-of-the-art-Breakthrough - most recent
stage in the development of a product,
incorporating the newest technology, ideas, and
features.
Leverage Creativity - It is a technique whereby
a business investigates certain materials or
ingredients that are ideal for their product and
then develops a new product to meet the
demands of the target market
Application Engineering - Where the
technology may not be changed at all, but its
use is new.
Adaptive Product - It is taking one's own or a
competitive product and improving it in some
way.
Imitation / Emulation - The enterprise is
enticed by multiple factors, especially the fact
that pioneering innovators are profitable, then
they through learning, and imitation, take the
pioneering experience, method of innovators,
and lesson.
How to Prepare Product Innovation Charter
● Step 1: We are always looking for
opportunities, inside and outside the
firm. Each strategy can be traced to the
strength of the company involved. No
one firm can be strong in everything.
● Step 2: We have to evaluate, rate, and
rank them.
● Step 3: We simply begin filling out the
PIC from—focus, goals, and guidelines.
Product Portfolio Analysis
● The New Product’s Strategic Fit
- As noted in Chapter 1, virtually
all firms consider financial
criteria when selecting which
products to add to their portfolio.
But the best-performing firms
also include strategic criteria in
their evaluations.
While by no means an exhaustive list, some
common strategic criteria might include:
● Strategic goals (defending the current
base of products versus extending the
base).
● Project types (balancing fundamental
research, process improvements, and
maintenance projects).
● Short-term versus long-term projects.
● High-risk versus low-risk projects.
● Market familiarity (existing markets,
extensions of current ones, or new
ones).
● Technology familiarity (existing
platforms, extensions of current ones, or
new ones).
● Geographical markets (balancing
sales or profits in North America,
Europe, and Asia).

Whatever criteria are used, the objectives of

developing the product portfolio remain the
same:
• Strategic alignment
• Assessing portfolio value
• Project Balance
• Number of projects
CHAPTER 2
Finding the Right People
innovative product programs and are also known
for being staffed with highly creative
people—those that get original ideas with a high
degree of usefulness
Genius Thinking Strategies:
1. Geniuses find many different ways to
look at a problem
2. Geniuses make their thoughts visible
3. Geniuses produce
4. Geniuses make novel combinations
5. Geniuses force relationships
6. Geniuses think in opposites
7. Geniuses think metaphorically
8. Geniuses prepare themselves for a
chance
Manager’s Role in Creativity
Management has a role in getting the best out of
its “ideas people.” Some firms truly embrace
new ideas, treating them like corporate
initiatives, organizing learning sessions, and
importantly, sticking with them rather than
moving on to the “next big thing.”
Obstacles to Idea Generation:
● Group Think
● Targeting error
● Poor customer knowledge
● Complexity
● Lack of empathy
● Too many cooks (internal competition)
Activities to encourage creativity
Today’s managers recognize that innovators are
apt to be different and need special treatment.
“Accommodative” is the word. Some firms
deliberately create competitive teams and have
them race to a deadline.
Special Rewards
There is no question about the value of
recognizing creative achievement. But creative
people are usually unimpressed by group
rewards. But creatives do like personal
accolades preferably immediately.
Removal of Roadblocks
When an idea comes up, listeners must first cite
all its advantages. Then they can address the
negatives, but only in a positive mode.
The Product Concept
When we launch a product in the market, it is
still in tentative form, because changes are quite
apt to be necessary to make it successful.
Therefore we say it is still a concept, an idea
that still needs to be fulfilled.
3 Processes of Product Concept
1. Form: This is the physical thing created,
or in the case of a service, it is a
sequence of steps by which the service
will be created.
2. Technology: This is the source by
which the form was attained.
Technology is defined in product
innovation as the power to do work. In
most cases, there is one clear
technology that is at the base of the
innovation.
3. Need/Benefit: The product has value
only as it provides some benefit to the
customer that the customer sees a need
or desire for.
The Concept Statement
is a verbal and/or prototype expression that tells
what is going to be changed and how the
customer stands to gain (and lose). Early on, the
information is quite incomplete, but when
marketed the concept is (hopefully) complete
Importance of Sources of Ready-made
Product Ideas
Experience in the field of product innovation has
it that 40 to 50 percent of new product ideas are
ready-made, coming from a wide variety of
sources.
User Toolkits
are a user-friendly set of design tools that
customers can use, together with their
understanding of their own needs.
Crowdsourcing
Many firms have recently gone online to obtain
product ideas from their customers efficiently:
this kind of open idea solicitation is known as
crowdsourcing.

Lead Users
Lead users are especially helpful in giving new
product ideas because their work is of the
problem-find-solve type

Open Innovation
has been defined as “the process a company
employs to externally search for. . . research,
innovation, new technologies, and products.”
The firm makes a strategic commitment to use
the knowledge in the external environment to
improve innovation performance.
CHAPTER 3
GATHERING THE PROBLEMS
Internal Records
most common source of needs and problems
that comes from an organization’s routine
contact with customers and others in the
marketplace.
Direct Inputs from Technical and Marketing
Departments
The only real problems with using in-house
people to report on customer problems are (1)
each suggestion is usually someone’s
perception of what the customer problem is, and
(2) there is usually a solution given with each
suggestion. In fact, sometimes we have to ask
what new product customers are asking for and
then ask why; the why is what we want to know
at this time.
Problem Analysis
is much more than a simple compilation of user
problems. Although the term problem inventory
is sometimes used to describe this category of
techniques, taking the inventory is only the
beginning—analysis is the key
If you then observe their subsequent behavior, it
becomes clear their problem list is a far better
predictor than the want list. Users verbalize their
wants in terms of current products, whereas
problems are not product specific.
Problem Analysis Procedure
● Step One: Determine the appropriate
product or activity category for
exploration. This has already been done
if the product innovation charter has a
use, user, or product category
dimension in the focus statement.
● Step Two: Identify a group of heavy
product users or activity participants
within that category. Heavy users are
apt to have a better understanding of
the problems, and they represent the
bulk of the sales potential in most
markets.
● Step Three: Gather from these heavy
users or participants a set of problems
associated with the category. Study the
entire system of product use or activity.
This is the inventory phase mentioned
earlier, but far more is involved than just
asking respondents to list their
problems. A good method of doing this
is asking respondents to rate (1) the
benefits they want from a set of
products and (2) the benefits they are
getting. The differences indicate
problems. Complaints are common and
often taken as requests for new
products.
● Step Four: Sort and rank the problems
according to their severity or
importance. Various methods can be
used for this. (1) the extent of the
problem, and (2) the frequency of its
occurrence.
Methodologies to Use
The generalized structure of problem analysis
still contains the question of how to gather the
list of customer problems. Many methods have
been used, but the task is difficult. The customer
or user often does not perceive problems well
enough to verbalize them
Published Sources - are frequently
useful—industry studies, the firm’s own past
studies on allied subjects, government reports,
investigations by social critics, scientific studies
in universities, and many others.
Stakeholder Contacts - The third, and most
productive, is to seek out the voice of the
customer (VOC)— that is, we will ask household
or business/industry customers directly, via
interviewing
● Interviewing - The most common
method by far is direct, one-on-one
interviewing. Sometimes this is a
 full-scale, very formal, and scientific
survey.
● Focus Groups - The focus group is
designed to yield the exploratory and
depth-probing type of discussion
required, and it can be easy and
inexpensive to set up and use.
● Observation - Observation methods are
rooted in sociological studies and
involve watching customers (or
noncustomers) using products in their
own environments.
communications medium such as online
social networking
● Discipline’s Panel - Their approach is
to assemble experts from all relevant
disciplines and have them discuss the
problem as a disciplines panel
Concept Generation Techniques in Action
creativity-stimulating techniques that can be
used to generate concepts
1. Using Props
2. Role Playing
3. Imitating Nature

● Role Playing - Though role-playing has

long been used in psychology to
enhance creativity, there is little
evidence of its successful use in
generating ideas for new products.

Scenario Analysis

Scenarios take several different forms. First, we

distinguish between (1) extending the present to
see what it will look like in the future, and (2)
leaping into the future to pick a period that is
then described.

Leap studies can be static or dynamic. In

dynamic leap studies, the focus is on what
changes must be made between now and then if
the leap scenario is to come about—the interim
time period is the meaningful focus

Solving the problems

Most problem-solving is probably done by
members of the new products group that has
been leading the concept generation work so
far. They do it instinctively, from the moment
they hear of a problem

● Group Creativity
● Brainstorming
● Online communities (or virtual
communities) have revolutionized
customer information gathering. An
online community can be defined as any
group that interacts using a
CHAPTER 4
Products are groups of attributes
A product is really nothing but attributes, and
any product (good or service) can be described
by citing its attributes.
Types of attributes:
1. Features (what the product consists of),
2. Functions (what the product does and
how it works)
3. Benefits (how the product provides
satisfaction to the user)
identify. These phantom attributes don’t show up
on the lists, are not included as map
dimensions, and by their absence distort the
analysis.
Comments on Gap Analysis
All gap mapping is controversial, but perceptual
maps are especially so. The input data come
entirely from responses to questions about how
the choices differ. Nuances and shadings are
necessarily ignored, as are interrelationships
and synergies.

Analyzing Product Attributes For Concept

Generation and Evaluation
Analytical attribute techniques allow us to create
new product concepts by changing one or more
of its current attributes, or by adding attributes,
and assessing the desirability of these concepts
if they were to be developed into products.

Gap Analysis
is a statistical technique with immense power
under certain circumstances. Its maps of the
market are used to determine how various
products are perceived by how they are
positioned on the market map.

Determinant Gap Map

Determinant gap maps are speedy and
cost-efficient but have the weakness of being
driven by only managerial judgment. Customer
perceptions may indeed be quite different. Plus,
brand perceptions might be more difficult for
managers to judge correctly.

Perceptual Gap Maps Based on Attribute

Ratings (AR)
Unlike the determinant gap map method,
attribute ratings (AR) perceptual gap mapping
asks market participants (buyers and users of
the product) to tell what attributes they believe
products have

Perceptual Gap Maps Based On Overall

Similarities (OS)
The problem was that users sometimes make
purchase decisions using attributes they cannot