Cooper, R. G. & Edgett, S. J. (2008). Maximizing Productivity In Product Innovation. Research Technology Management, 51(2), 47-58.

Format: Peer-reviewed article

Type: Research — Randomized

Experience level of reader: Fundamental

Annotation: The authors wrote this article based on their 20 years of experience in researching new product development and what contributes to successful end products. In addition, they use data from a recent study on best practices of 105 firms and their NOD success or failure based on metrics, such as sales, profits, time to market, etc. They highlight seven core principles (or best practices) which the high producing companies of today follow. The seven principles are; customer focus, front end loaded assessments before development, spiral development, cross-functional teams, metrics, accountability and continuous improvement, effective project portfolio management and the NexGen Stage-Gate process.

Setting(s) to which the reported activities/findings are relevant: Large business, Small business (less than 500 employees)

Knowledge user(s) to whom the piece of literature may be relevant: Manufacturers

Knowledge user level addressed by the literature: Organization

This article uses the Commercial Devices and Services version of the NtK Model

Measure: Use the following metrics to measure the performance of new product development projects; earned revenue versus forecasted revenue, operating profits,customer satisfaction, and time to market.
Authors' research experience. Between 65% — 80% of companies use these metrics to measure performance.
Occurrence of finding within the model: Step 9.3

• Consider adopting the NexGen Stage-Gate process, where the NPD process has been streamlined by removing all the non-value added activities. 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.
  Occurrence of finding within the model: Stage 1, Stage 2, Stage 3, Stage 4, Stage 5, Stage 6, Stage 7, Stage 8
• Practice spiral development, where a virtual prototype is created very early in the process to get immediate feedback from consumers. The build-test-feedback cycle is done quickly and often creating a loop type process.
  Authors' research experience. Top performing companies use spiral development.
  Occurrence of finding within the model: Stage 2, Stage 4, Stage 5, Stage 6

Method: Work closely with consumers to understand their needs and identify their problems.
Authors' research experience. Approximately 67% of high productivity companies followed these practices, while only 15% of low productivity companies did.
Occurrence of finding within the model: Step 4.11, Step 1.2

Tips:

• Conduct a financial and business analysis, including a spreadsheet with Net Present Value, Internal Rate of Return as well as a sensitivity analysis.
  Authors' research experience. A greater percentage of high productivity (57.1%)companies will do a business assessment over the low productivity companies (23.1%).
  Occurrence of finding within the model: Tip 2.3
• Look at projected metrics, such as Net Present Value, year 1 sales, or launch date, to help make the go/kill decision. These projections will be used as success criteria as the project moves forward.
  Authors' research experience. These success metrics are necessary to hold teams accountable and are used to understand and improve the new product development process for the organization.
  Occurrence of finding within the model: Gate 4
•  Make technical assessments to assess technical risk, probably solutions and the feasibility of manufacturing.
  Authors' research experience. A higher proportion of high productivity companies (64.3%) make technical assessments over the low productivity companies (23.1%).
  Occurrence of finding within the model: Tip 2.4
• Develop products that offer new and unique benefits and offer more value for the cost.
  Authors' research experience. High productivity companies follow these best practices more so than low productivity companies.
  Occurrence of finding within the model: Tip 2.2
• Use market research and concept testing to define product requirements.
  Authors' research experience. More high productivity companies do this compared to low productivity companies.
  Occurrence of finding within the model: Tip 4.1, Tip 4.13
• Assemble cross-functional teams consisting of key players within the company. Make it clear to the entire organization that these individuals are assigned to the project and the entire team is accountable for the end results.
  Authors' research experience. More high productivity companies use these practices than low productivity companies.
  Occurrence of finding within the model: Step 4.1
• Conduct preliminary market assessments, do market research, concept testing, determine the value of the product to the consumer.
  Authors' research experience. More high productivity companies (55.2%)use these best practices than do low productivity companies (34.6%).
  Occurrence of finding within the model: Tip 2.1

Barrier: Unstable product specs and project scope creep can increase the time to market and possible product failure. (Cooper, R.G., 2001)
Occurrence of finding within the model: Stage 6, Stage 7

Tips:

• Identify and form relationships with lead user consumer groups. Engage them in meetings to discuss any innovative ideas they may have. (Cooper, R.G., Edgett, S.J. & Kleinschmidt, E.J., 2003, 2004, 2005)
  Occurrence of finding within the model: Step 1.2, Step 1.1
• Use focus group sessions to invite consumers to discuss their problems and challenges. Host brainstorming events with consumers and the project team to come up with innovative solutions to their problems. Obtain consumer input online through your company's website. (Cooper, R.G., Edgett, S.J. & Kleinschmidt, E.J., 2003, 2004, 2005)
  Occurrence of finding within the model: Step 1.2, Step 1.1
• Conduct indepth face to face consumer interviews with the entire project team. Create and use a well thought out interview guide which probes for consumer unmet needs and problems which may or not even be realized by the consumers. (Cooper, R.G., Edgett, S.J. & Kleinschmidt, E.J., 2003, 2004, 2005)
  Occurrence of finding within the model: Step 1.2, Step 1.1

• "Camp out" in the consumers home or work environment. Non-intrusively observe how the consumer interacts with their current products and take note of any problems or issues that arise. (Cooper, R.G., Edgett, S. J. & Kleinschmidt, E. J., 2003, 2004, 2005)
  Occurrence of finding within the model: Step 1.2, Step 1.1