6 Steps to Having a Flawless New Product Development Process

There is lots of value in a new product development process. It is necessary in large and small businesses, often forming the core of general business operations. Investors, managers, and customers who care about what the business produces have an interest in a quality product development process.

There are several steps in the process. According to them, you should specify demand, identify best options, go to prototyping and testing, make manufacturing happen, make a ROI evaluation and improvement, and retain lessons. Let’s look at them in detail.

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New Product Development Process in 6 Efficient Steps

1. Specify Demand

The first step in a new product development process is to identify business need and end user satisfaction.

  • Specifically, what is purpose of a new product?
  • What will it do, and what can existing competing products do?
  • What would be the sales pitch to a customer?
  • Is this a question of fulfilling a necessity at low cost?
  • A luxury to indulge in for status displays?
  • Could the product be described as an investment that will end up paying for itself in the long run?

Questions such as these are critical in the first step of the product development process. This is since it is here that demand is clearly enunciated. Also, the beginnings of a marketing strategy develop alongside product specifications.

2. Identify Best Options

Examine limits of time, budget, expertise, institutional knowledge, and engineering feasibility. Focus on risks, flaws and quirks of proposed products. Here, best should correspond to lower risk as much as likely returns. Again, it is important to quantify and detail, to the extent possible, likely demand and market for the product version(s) selected by the screening process.

Throughout the first two steps, SWOT analysis and the like should be used heavily. More detailed aspects of a marketing plan for the product to be developed should be thought out. Consider:

  • Market segmentation;
  • Market strategy;
  • What kind of advertising campaign would draw customers away from competitors;
  • What to highlight or downplay in terms of the new product, and so on.

3. Prototype and Test

Design and manufacture a few versions of the selected product to get familiar with the development and manufacturing process. It is important that the new product development process generates several varieties that highlight various features of the product like ease of repair, production cost, user-friendliness, longevity, and risk to producer if you also offer warranty.

Test the product and the production process itself, making sure there are no weak spots in the design or the production line. If the development process relies on procuring rare, hazardous, or costly raw materials, look into diversifying the product development supply chain or substituting parts or materials. The reason for this is to reduce the bargaining power of a supplier who may increase your production costs to the point that a formerly profitable product and its manufacture becomes prohibitively expensive.

To summarize, note that here prototyping and testing refers to three aspects of the general product development process:

  • The product itself;
  • Product development/manufacturing process;
  • Procurement of materials or other inputs necessary for product development.

The final part of this step is to test the product with limited release and associated limited marketing. Here, developers and others on the production team need to gain feedback from focus groups and users about what features are perceived as best/worst in terms of performance and value. This is important, do not assume that whatever is the most rational or best feature from a design or manufacturing perspective will correspond to user opinion.

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4. Go On to Manufacturing

With some experience in limited production and user feedback, it is time to begin full-scale product manufacture, delivery, and marketing. As before, analyze manufacturing costs, risks, weak points and check manufacturing robustness. Prepare for full-scale orders and operations and initiate them. At this point the product can officially launch into the open market. A note of point: do not pull off a shotgun approach and simply flood the market with the product, hoping people will buy it.

A large part of ultimate product success and profitability is marketing. The market entry is very important, as is the buzz and anticipation of your product’s availability by the target market. Companies like Apple are notorious for anxious consumers/fans standing in long lines just to get the latest iPhone. This is an extreme example, but the point stands. Build up your target market to want your product before selling it to them. Individual salesmen try to generate need, or at least perception thereof. Likewise, the product development marketing and advertising teams need to make your product wanted, not just available.

5. Make a ROI Evaluation and Improvement

At this point, the new product development process turns to product reception in the market and corresponding sales. Marginal and average per-unit COGS, profitability, reviews and ratings by consumer agencies are just some of the variables that need to be analyzed by product development leaders.

Afterwards, incorporate useful feedback from consumers into future product design improvements.

6. Retain Lessons

In any new product development process, institutional expertise should be recorded and retained. Document strengths and weaknesses of the product itself as well as the product development process outlined in the above steps.

ROI for future product development can improve substantially. This is since the cost and time spent on re-learning mistakes and fallacies of a previous process can be drastically cut with proper institutional knowledge retention.

Wrapping Up for Release

A smooth new product development process is critical to continuous success. Product development should be a synthesis of flexibility and reliability/high quality. The flexibility comes earlier in the process, with quality and reliability becoming paramount when products are delivered to market.

Those interested or experienced in product development, procurement, evaluation or other aspects of product development are very welcome to leave a comment below.

The images are from depositphotos.com.