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New Product Development (NPD)

New product to grow market share or within overall

strategic process of product life cycle

8 Stages

  • 1. Idea generation (research, SWOT, consumer trends, R&D, competitors)

  • 2. Idea screening phase (eliminate unsound concepts by asking questions)

  • 3. Concept development and testing (marketing & engeneering details)

  • 4. Business analysis (i.e. Selling price, sales volume, profitability etc.)

  • 5. Beta testing and market testing (prototype, packaging, interviews)

  • 6. Technical implementation (i.e. Resources, requirments, quality, logistics

...

)

  • 7. Commerzialization (post NPD launch, adverts, promos, distribution

...

)

  • 8. NPD pricing (value analysis, procuct costs TIME!!!

Operations Management

New Product Development (NPD) New product to grow market share or within overall strategic process of
New Product Development (NPD) New product to grow market share or within overall strategic process of

The path to develop successful new products

a) Talk to the customer

b) nurture a project culture

c) Keep it focused

Operations Management

The path to develop successful new products a) Talk to the customer b) nurture a project
The path to develop successful new products a) Talk to the customer b) nurture a project

New Product Development (NPD)

„Fuzzy Front End“

= the messy „getting ended“ period of a new product engeneering

development. The front end where a company decides:

  • - to formulate a concept

  • - not to invest resources

  • - to go ahead an do into a structured process

Fuzzy Front End may not be an expensive part of the NDP but it can

consume 50% of development time. It is where major commitments are made involving time, money and the products nature setting

the course for the entire project and final end product!

Operations Management

New Product Development (NPD) „Fuzzy Front End“ = the messy „getting ended“ period of a new
New Product Development (NPD) „Fuzzy Front End“ = the messy „getting ended“ period of a new

Product Design

Strategies for new product introduction New product development process Cross-functional product design Supply chain collaboration Quality function deployment Value analysis Modular design

Operations Management

Product Design • Strategies for new product introduction • New product development process • Cross-functional product
Product Design • Strategies for new product introduction • New product development process • Cross-functional product

Market introduction strategy

Market introduction strategy Example pull: New Porsche car > „branding“ > existing need Example push: New

Example pull: New Porsche car > „branding“ > existing need Example push: New perfume > „recognition“ > sleeping need

Operations Management

Market introduction strategy Example pull: New Porsche car > „branding“ > existing need Example push: New
Market introduction strategy Example pull: New Porsche car > „branding“ > existing need Example push: New

New Product Development Process

Organized NPD process following specific phases, often formally defined in company documents. This is to gain control and to

ensure that all important issues are addresses by NPD team >

required by

ISO 9000

Typical phases

  • a) Concept development

    • b) Product design

  • c) Pilot production/testing

Operations Management

New Product Development Process Organized NPD process following specific phases, often formally defined in company documents.
New Product Development Process Organized NPD process following specific phases, often formally defined in company documents.

a) Concept development

Generate ideas

Evaluate alternatives

Select one to go to next phase

Above decisison requires top managemenet approval

At time of decision cross-functional team gets established (if not already existant) to design new product.

Operations Management

a) Concept development • Generate ideas • Evaluate alternatives • Select one to go to next
a) Concept development • Generate ideas • Evaluate alternatives • Select one to go to next

b) Product design

Design the physical new product

From general idea to set of product specs and engeneering drawings/images in sufficient detail to build prototypes.

Product design requires many different trade-offs, such as:

Product costs

Quality (features)

Schedule

Simultaniously: Process design

Operations Management

b) Product design Design the physical new product From general idea to set of product specs
b) Product design Design the physical new product From general idea to set of product specs

c) Pilot production/Testing

In many cases testing! Hardware Software

Lifetime tests of reliability Market test

Production process gets finalized!

Operations Management

c) Pilot production/Testing In many cases – testing! • Hardware • Software • Lifetime tests of
c) Pilot production/Testing In many cases – testing! • Hardware • Software • Lifetime tests of

NPD product design process

NPD product design process Concept development Product design Pilot / Testing Prelim. Process design Final process
 

Concept

development

 
  • Product design

 
 

Pilot / Testing

 

Prelim. Process

design

NPD product design process Concept development Product design Pilot / Testing Prelim. Process design Final process
Final process design
Final process
design
NPD product design process Concept development Product design Pilot / Testing Prelim. Process design Final process

Operations Management

NPD product design process Concept development Product design Pilot / Testing Prelim. Process design Final process
NPD product design process Concept development Product design Pilot / Testing Prelim. Process design Final process

Cross functional product design

Sequential approach

Marketing Engeneering Operations
Marketing
Engeneering
Operations

Operations Management

Cross functional product design Sequential approach Marketing Engeneering Operations Operations Management
Cross functional product design Sequential approach Marketing Engeneering Operations Operations Management

Cross functional product design

Concurrent engeneering Marketing Engeneering Operations Effort
Concurrent engeneering
Marketing
Engeneering
Operations
Effort

Time

Operations Management

Cross functional product design Concurrent engeneering Marketing Engeneering Operations Effort Time Operations Management
Cross functional product design Concurrent engeneering Marketing Engeneering Operations Effort Time Operations Management

Supply chain collaboration

Customers & suppliers Customers:

Ask the right questions!

Present incentives

Create collaborative technology platform

Include customers as advisors to design team Suppliers Technical espertise Cabability targets for costs, quality &product performance

Capacity meet schedule & ramp-up to production?

Low-risk what is the risk if supplier will not perform? Operations Management

Supply chain collaboration Customers & suppliers Customers: • Ask the right questions! • Present incentives •
Supply chain collaboration Customers & suppliers Customers: • Ask the right questions! • Present incentives •

Quality Function Deployment

Quality Function deployment (QFD) = translating the ordinary language obtained from the customer to technical requirements understood by engineers. Or, in other words ,

linking customer requirements to technical specifications.

Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer
  • „House of quality!“

Consists of:

Customer attributes

Engeneering characterisitcs

Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer
Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer
Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer
Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer
Quality Function Deployment Quality Function deployment (QFD) = translating the ordinary language obtained from the customer

Operations Management

Value Analysis

It is not only about meeting customer requirments but also about ensuring that the product is manufacturable!

Desing for Manufacturing (DFM) is an approach consisting of:

  • 1. Simplification of prodcuts

  • 2. Manufacture of multiple products using common part, processes and modules

Operations Management

Value Analysis It is not only about meeting customer requirments but also about ensuring that the
Value Analysis It is not only about meeting customer requirments but also about ensuring that the

Modular Design

DFM also contains the aspect of how to simplify the design of multiple products.

Operations Management

Modular Design DFM also contains the aspect of how to simplify the design of multiple products.
Modular Design DFM also contains the aspect of how to simplify the design of multiple products.

Value Analysis

It is not only about meeting customer requirments but also about ensuring that the product is manufacturable!

Desing for Manufacturing (DFM) is an approach consisting of:

  • 1. Simplification of prodcuts

  • 2. Manufacture of multiple products using common part, processes and modules

Operations Management