Stage 8: Launch Product Innovation

Primary findings

Secondary findings

Primary findings

Carriers

Three elements that did not appear on any academic NPD plans appeared on all five corporate NPD plans: 1) Define the market and its growth potential; 2) Actual versus planned cost evaluation; 3) Determining of changing customer needs/market requirements. Perhaps the Technology Transfer Offices (TTO's) could support academic inventors by providing these elements. In fact, 51% of TTO's support #1, 10% support #3 but none support #2 at present.
Eleven structured interviews involving five academics, five corporate and one hybrid approach, where each mapped their individual approach to NPD drawing from a set of Stage and Step activities.
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Models

Consider adopting the NexGen Stage-Gate process, where the NPD process has been streamlined by removing all the non-value added activites. This NexGen process is also more flexible and adaptable, where steps and stages overlap.
Authors' research experience. This new process has been borrowed from lean manufacturing.
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Keep the formal structured NPD process for effective new products while adding improvisation within stages, in order to avoid chaos.
Survey. Conclusion of the study
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Reduce NPD cycle time by overlapping activities performed in different stages
Survey. Conclusion of the study
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Stage/Gate Model — Authors substantiate the value of a Stage/Gate model for conducting NDP processes.
Survey. Authors conclusions drawn from analysis of Project Manager self-reports (n = 392)
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Methods

Benchmarking involves reviewing the practices of other firms because of their known reputation for good performance. Firms that establish their industry benchmarks based on NPD practices, rather than based on NPD performance, were more likely to apply design-manufacturing integration (e.g., train personnel in new design methods, have manufacturing sign-off on design reviews, or restructure into cross-functional teams). The focus here is on product-process development integration — that set of focused, disciplined, rigorous practices designed to concentrate efforts on evolving from concepts to market introduction.
Survey of 43 U.S. firms.
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Four Best Practices in the NPD process are: 2) Performance Measurement. The use of metrics to gauge how products perform — success, profitability, Net Present Value, is a major weakness with less than 30% of firms having such metrics.
A quantitative survey of 105 business units, supported by team's experience in NPD modeling, consultation, application and analysis.
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Maintaining sufficient lead time over competitors has a positive impact on market share. Similarly, lagging has a negative impact on market share. Lead and lag time is particularly significant during volume production and concept generation stages, and less significant during the prototype development stage.
Survey. High statistical significance.
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NPD Project Team and Functional Group — information disseminating, engendering ownership, creating discipline, information seeking, facilitating cross-functional planning — This communication is a combination of the uncertainty reduction activities as well as the engagement capabilities. When the members of the functional groups have a sense of ownership, they are proactive in seeking information they require, and providing information that will be necessary in advanced stages.
Case study analysis.
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Ten methods used in various Stages of the NPD Process are listed in the Appendix and discussed in the paper: 1) Brainstorming; 2) Morphological analysis; 3) Synetics; 4) Delphi Method; 5) Focus Group; 6) Product Life Cycle; 7) Concept Test; 8) In-home Use Test; 9) Quality Function Deployment; 10) Limited Roll-Out. While most manufacturers are familiar with many of these methods, they report using them in various and sometimes wrong stages — so they are not applying them properly and in a focused manner.
Literature review and survey of forty-five manufacturers.
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To ensure compliance with the FDA's Quality System Regulation, medical device manufacturers should use a structured product development process to instill discipline in the product life cycle. A hierarchical approach arranges activity from Stages (phases) to Steps to Activities and finally to Tasks. Each Stage has a unique theme and set of deliverables. For example: Stage 4 — Commercialization. Delivering the product to customers in a controlled manner and gathering feedback on the product's performance. Includes full-scale product launch, release of evaluation tools and mass communication with customers. Manufacturing operations are ramped up to full-scale production. In addition, a post-launch evaluation is conducted to assess the actual results in comparison to projected performance and sales. The NPD team hands the product ownership and control over to the supporting organization for the duration of the product's life cycle.
Summary of the U.S. Food and Drug Administration's regulations for the research and development process underlying Medical Device manufacturing.
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Measures

Stage 8 — Launch Commercialization involves several checklist items shown in Table 6.
Conclusions drawn from case studies and experience.
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Table 2 (page 146) lists five categories of intertemporal integration activities, and three levels of NPD performance. Table 2 goes on to list sets of measures appropriate for each.
Conceptual model creation based on literature review.
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The Prediction stage in NPD uses three different tools: Computer Prediction Models; Diffusion Models; Economic Models (ROI/BE — analysis/pay-back time).
Literature review and survey of forty-five manufacturers.
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Tips

Firms with a concentrated structure (new product activities at one location and manufacturing at another) are at risk of losing market share to competitors for a longer period of time than firms with a distributed structure (new product development and manufacturing housed together at multiple locations). Ie) A distributed firm will retain market share advantages related to being first-to-market so long as competition does not enter the market for 10 days. A concentrated structure firm must not have competition for 30 days or it will lose market share.
Survey. High statistical significance.
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Maintain contact and involvement with consumers
Survey.
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Market share gains can only be sustained with substantial lead time in volume production when product diffusion is occurring slowly.
Survey. High statistical significance.
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Most of the methods have been developed to deal with specific problems of NPD and thus are meant to be used in specific Stages of the NPD process. Out of ten methods reviewed, all one (Limited Roll-Out) are used in stages for which they are not intended.
Literature review and survey of forty-five manufacturers.
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Secondary findings

Carriers

When planning, implementing or evaluating a knowledge translation (innovation) process, diffusion theory suggests that one of the factors that can influence the appeal of new knowledge to a potential knowledge user is its trialability. Generally, adoption strength increases with the knowledge user’s ability to incrementally test the viability of the new knowledge prior to its full implementation.
Source: (Rogers, 2003). In: Ashley, S.R. (2009)

Models

A formal new product development process necessary for product success with five key stages (initial screening, business analysis, development, pre-testing, and launch) or 13 equivalent key activities. 
Source: NASA (no specific citation); Cooper, 2001; Cooper & Kleinschmidt, 1986; Song et al, 1998.. In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

A literature review found two differences between studies of the early R&D Stages (3,4,5) and the later NPD Stages (6,7,8): First the R&D project studies cited a larger number of factors listed as critical to success, than did the NPD projects. Second, studies with a marketing orientation put more emphasis on internal organizational factors (e.g., launch & marketing) as critical, while studies with a technical orientation put more emphasis on external environmental and market factors as critical.
Source: Calantone & di Benedetto (1988). In: Balachandra, R., Friar, J.H. (1997)

An NPD Model shows that technical and marketing activities complement each other at each stage of the NPD process, which takes place within an environment defined by the firm, the marketplace, and the nature of the project itself.
Source: Cooper (1980). In: Calantone, R.J., diBenedetto, C.A. (1988)

Consider increasing speed to market as a way to increase product success
Source: Cooper, 1994; Cooper & Kleinschmidt, 1994; Ridderstrale & Nordstrom, 2000.. In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Consider increasing new product development proficiency level as a way to increase new product success
Source: Cooper & Kleinschmidt, 1987a. In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Improvise as you go along with no formal and structured new product development process(improvisation school of thought) 
Source: Moorman & Miner (1998). In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Use a structured new product development process to ensure new product success (structured school of thought) 
Source: Cooper & Kleinschmidt (1986, 1987a & b, 1991); Mllson & Wilemon, 2002; Shepherd & Ahmed, 2000). In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Using a flexible and structured new product development process (with fuzzy gates) skipping or combining stages (flexible school of thought) 
Source: Cooper & Kleinschmidt (1995) . In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Methods

As might be expected, product performance is significantly enhanced if those responsible for manufacturing are included in the product design process.
Source: Bergen & McLaughlin (1992). In: Ettlie, J.E. (1995)

Close integration between product planning and manufacturing process decisions helps control the product offerings, stabilize process requirements, improve process technology choices, and increase net cash flows over time.
Source: Kim et al (1992). In: Ettlie, J.E. (1995)

Measures

A universal success curve shows that the odds of commercial success for substantially new products averages 1 in 300 at the idea submission stage (or at patent disclosure stage), and 1 in 125 at the small project stage (or after a patent is granted). After the detailed analysis of Stage 4, the odds of success are 1 in 9 (11%). Even when the project reaches the stage of major development, the odds of success are typically no greater than 1 in 4 (25%). At the commercial launch stage the odds of success are still only 1 in 1.7 (60%). This success rate curve has remained essentially unchanged in the last 40 years.
Source: Stevens & Burley (1997). In: Stevens, G., Burley, J., & Divine, R. (1999)

Tips

Consulting and Contract Research relationships tend to provide more common yet specialized expertise that is required in the latter stages, such as product differentiation and improvement.
Source: Meyer-Krahmer & Schmoch (1998). In: Perkman, Markus & Walsh, Kathryn (2007)

Improvisation at the collective or organizational level (vs. individual level) can be achieved by coalescing individuals’ activities by groups, departments, etc.
Source: Chelariu et al, 2002; Moorman & Miner, 1998.. In: Samra, Y.M., Lynn, G.S. & Reilly, R.R. (2008)

Use customer information when planning and managing the launch because the product must be positioned towards the customers' needs while communicating the product solutuion. A good source for finding customer information is at trade shows.
Source: Di Benedetto (1999), Stryker (1996), Ylinenpaa (1997). In: Frishammar, J. & Ylinenpaa, H. (2007)

Use failure mode and effects analysis to improve the probability of new product success.
Source: Griffin (1992); Hockman& Jenkins (1994); Wasserman (1993). In: Ittner, C. D. & Larcker, D. F. (1997)