Managing the new product development process: Strategic imperatives

Executive Overview For many industries, new product development is now the single most important factor driving firm success or failure. The emphasis on new products has spurred researchers from strategic management, engineering, marketing, and other disciplines to study the new product development process. Most conclude that in order to be successful at new product development, a firm must simultaneously meet two critical objectives: maximizing the fit with customer needs, and minimizing time to market. While these objectives often pose conflicting demands on the firm, there is a growing body of evidence that the firm may employ strategies to successfully meet these objectives. Successful firms are those that articulate their strategic intent and map their R&D portfolio to find a fit between their new product development goals and their current resources and competencies. Their success also rests on how well the technology areas they enter contribute to the long term direction of the firm by helping them build new core capabilities critical to the firm's long term goals. Strategic alliances to obtain enabling technologies may shorten the development process, but partners must be chosen and monitored carefully. When firms are choosing technologies to acquire externally, they must assess the importance of the learning that would be accrued through internal development of the project, and its impact on the firm's future success. Other imperatives include using a parallel (rather than sequential) development process to both reduce cycle time and to better incorporate customer and supplier requirements in the product and process design, and using executive champions to ensure that projects gain the resources and organizational commitment necessary to their completion. Development teams should include people from a diverse range of functions and should include suppliers and customers to improve the project's chances of maximizing the fit with customer requirements while reducing cycle time and potentially reducing costs. Tools such as Stage-Gate processes. Quality Function Deployment, Design for Manufacturing, and Computer Aided Design/Computer Aided Manufacturing may be useful on different projects.