Flashcards in Lecture 1, Introduction Deck (27)
Intended learning outcomes intro lecture?
1. explain what is meant by a product's lifecycle and its implications for companies product planning
2. Explain the role, tasks, organization and deliverables of product planning
3. Identify and evaluate new product opportunities that derive from new technologies and services and latent needs
4. Develop a mission statement for a particular product development project
What makes a product?
1. The idea with the product
—> customer needs
—> societal needs
—> market understanding
2. The idea in the product
—> technological opportunities identification
—> corporate competitive advantage
—> available resource & knowledge
—> Technological development needs
3. Unique competitive advantage
—> original feature?
why new products succeed?
2. superior performance
3. sufficient target market
4. based on internal strength
—> (product cheeper, quicker,
5. deep insight into customer needs
6. effective use of a new product development process
7. good collaboration in development
why new products fail?
1. poor idea
2. poor positioning
3.market too small
4. lacking companies capabilities
5. organisational problems
6. inadequate distribution
7. poor timing
effective product development practices
1. structured development process
— explicit decition process
— checklist including key steps
2. Use of relevant methods and tools
3. A multi-disciplinary development team
4. Shift in perspective, changes in attitude towards customer and user orientation
Product planning process
1. Identify opportunities
2. evaluate and prioritize projects
3. Allocate resources and plan timing
—> Product plan
4. complete pre-project planning
—> Mission Statements
5. product development process
A product plan identifies the portfolio of products to be developed by an organization and the timing of their introduction to the market. Prior to making a product plan, we need to look for product and market opportunities.
what is an opportunity?
—> driven from customer needs (market opportunity)
—> Technology push (Technological opportunity)
specific with Pharmaceutical drug development?
1. 10,000 newly discovered compounds
2. takes very long time (8-12 years)
3. very expensive 500 million - 1 billion dollars
4. Ends up in 1 new drug
Specific with Hollywood film studios?
1. 500 pitches
2. 3-5 years and 50- 200 million dollar
3. turn into 1 movie
Opportunity identification process?
1. establish an innovation charter
2. generate and sense many opportunities
3. screen opportunities
4. develop exceptional opportunities
5. select opportunities
6. reflect on results
1. Establish an innovation charter?
1. articulate the goal and the boundary condition for an innovation effort
2. A broad statement is preferable to encourage the team to consider opportunities beyond the traditional assumptions in the firm
"Create a physical product in the cat toy category that we can launch to the market within a year thought our existing retail channels"
2. generate and sense opportunities?
where do opportunities come from?
1. internally generated 46%
2. customer needs 23%
3. competitive product 11%
4. sales force 5%
5. university 4%
techniques for opportunity identification
1. follow passion
2. compile bug test
3. pull opportunities from capabilities
4. study customers
5. consider implications of trends
6. imitate but better
7. mine your sources (talking to people you know)
3. Screen opportunities?
We are looking to find opportunities that are "VRIN"
- advance components with high-performance materials
(3.) How can you screen opportunities?
1. web-based surveys
2. workshops with idea presenters who pitch and stakeholders who vote
Select excellent opportunities
1. Real-win- worth screening (checklist)
2. Best practice scoring model
3. Concept selection methods
What is real-win-worth screening?
A method where proposed ideas are evaluated with respect to three basic question:
1. Is there a REAL market?
2. Can we WIN?
—> can we be competitive?
—> can we succeed as a company?
3. Is it WORTH doing?
—> Is the return and the risk acceptable?
1. how many opportunities came from internal and external sources (50-50 rule of thumb)
2. did we consider many opportunities?
3. was the innovation charter too narrow?
4. Where our screening criteria biased?
5. are the results exciting?
What does a Mission statement include?
1. A brief description of the product
2. Benefit proporal
3. key business goals
4. primary market
5. secondary market
6. assumptions and constraints
What are the course aims?
— The fundamentals processes and methods of product planning
SKILLS IN THE APPLICATION OF TOOLS:
— Analysing different stakeholders' needs and requirements
— Formulating project plans, missions and customer needs' list
GENERIC REASEARCH SKILLS:
— information search and assessment
— research design, including identification and selection of methods
— written and oral communication of research results
Name some different tasks in the planning phase!
—> Articulate market opportunity
—> Define market segments
—> Consider product platform and architecture
—> Assess new technologies
—> Identify production constraints
—> Set supply chain strategy
—> research: Demonstrate new technologies
—> Finance: Provide planning goals
—> General management: Allocate project resources
Why do companies need to develop new products?
Because of the product lifecycles. All product sales will decline with time if it is not continually improved and updated
You also need to continually shortening product lifecycles require maintaining a pipeline of overlapping PD project
1. To maintain sales and market share growth
2. To handle cometition
3. To adress consequences of product lifecycle
4. To changes in technology
5. TO new regulations and laws
6. changes in cost and availability
7. changes in demography and lifestyles
8. Due to trends
Name some specific challenges for product planning?
1. customer and market understanding
2. Uncertainty & decision-making
What does product planning considerations include?
1. Competitive strategy
— Technology leadership
— Cost leadership
— Customer focus
2. Technology development
— technology trajectories
— product platform planning
— fundamental new product opportunities
— balancing the portfolio
3. Market strategy
— Market tends
— Market segmentation
What is the final outcome of the product planning process?
The final outcome of the product planning process is a mission statement.
Conclusions from this lecture?
1. Product development is challenging and many products fail
2. Product planning simultaneously consider the technology and market basis for new products
3. Product planning precedes formal product development projects and is thus less resource-consuming but yet crucial for the success in the formal project
4. Product planning tool aims to identify and select promising product ideas and make plans for their development