Executive in wait

Six Sigma advocates a 5 stage process for new product development. The complete NPD process includes the following stages:

1. Concept Study. This is done to uncover unknowns about the market and technology.
2. Feasibility investigations are done to determine the limitations of the concept.
3. Development of new product includes specifications, needs of customer, study of target markets etc.
4. Maintenance activities following delivery.
5. Continous learning through status reports and evaluation.

According to a old (1993) study, new products account for 40% of sales and 46% of profits. For every 7 to 11  new product ideas, only 1 becomes a successful product according to a study.

Here are some of the factors for creating winning products.

• Unique, superior product. Product should have value for customer
• Strong market orientation. Understanding for customers needs and wants.
• Predevelopment work. Up front activities like market analysis, technical assessment are vital before development starts.
• Good product definition. Product and project should be completely defined before development begi
• Quality of execution through out the development process.
• Team effort including research & development, marketing, sales and operations.
• Proper project selection to provide adequate resources for good projects. Poor projects must be killed.
• Good product launch ensures success.
• Top management leadership plays a vital role in product development process. They must provide strategy, resources and leadership.
• Speed to market.
• Strong, established new product process to screen new products
• Attractive market makes it easier to have a successful project

In the area of new product development, here are some commonly accepted new product terms

1. New-to-world products : These are inventions and discoveries such as laser printers etc.
2. New category products : These are products that are not new to the world, but to the company.
3. Additions to product lines : These are extensions to the company’s existing product line like diet coke.
4. Product improvements : Improvements to existing products.
5. Repositioning’ s : Products that are re targeted for new use. Baking soda as a deodorant
6. Cost Reductions: New products replacing exisitng one’s, with lower cost.