Full citation

Bonabau, E, Bodick, N & Armstrong, RW. (2008). A more rationale approach to new product development. Harvard Business Review, (March), 96-102.

Format: Peer-reviewed article

Type: Experience

Experience level of reader: Fundamental

Annotation: Companies operating in industries where NPD costs are high, and failure rates for new market introductions are also high, may wish to add an early-stage experimental research process that emphasizes feasibility testing.

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

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

Knowledge user level addressed by the literature: Organization

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

Primary Findings

Carrier: One company established an NPD process with carefully staged decision-making, rigorous process reviews, and strict timelines. Yet, skillful project champions would maneuver to win continued support at each level of project review. The company then reassigned project managers so that the more empirically included truth seekers were in charge of early stage reviews, and more commercially included success seekers managed the later stages. That simple change improved NPD productivity.
Private sector experience in pharmaceutical industry.
Occurrence of finding within the model: Gate 1, Gate 2, Gate 3, Gate 4, Gate 5, Gate 6, Gate 7, Gate 8

Methods:

  • Companies that could benefit from an early-stage empirical analysis should create a new, separate organization focused on truth seeking — or outsource this function to qualified academic researchers. A small team manages the operation, recruiting both internal and external staff and consultants with expertise and objectivity. The teams design critical experiments to rule in or rule out a product's key attributes. Teams should be small and fluid comprised of persons motivated by intellectual curiosity. No one follows any of the projects into the later NPD stages to maintain their objectivity.
    Private sector experience in pharmaceutical industry.
    Occurrence of finding within the model: Gate 3, Step 3.1, Step 3.8, Step 3.5
  • When it is critical to identify barriers to market success early in the NPD process, proof of concept testing may be outsourced to external experts who advise on experimental designs, and external vendors who can advise on manufacturing, potential hazards and specialized services. Such outsourcing reinforces truth-seeking by injecting dispassionate outside perspectives. This also frees internal experts to focus on the analysis of the evidence generated by the external experiments.
    Private sector experience in pharmaceutical industry.
    Occurrence of finding within the model: Step 3.1, Step 3.8, Step 3.5
  • Role for Research in NPD Process — In industries where both NPD costs and market failure rates are high, speed to market should be compromised by a focus on feasibility testing through scientific methods. Most organization's focus on late-stage NPD where the emphasis is on seeking success through commercialization methods. They lack a truth-seeking function based on objective empirical research methods to validate the proof-of-concept.
    Private sector experience in pharmaceutical industry.
    Occurrence of finding within the model: Step 3.2, Step 2.2
  • Most NPD processes emphasis teamwork, concurrent engineering, and speed to market. However, industries where development costs are high, and where market failure rates are high, may be better served by focusing on empirical trials to explore feasibility at an early stage. This early truth-seeking stage focuses on evaluating the prospect of success for novel products, to eliminate bad bets that are likely to waste organizational resources.
    Private sector experience in pharmaceutical industry.
    Occurrence of finding within the model: Step 3.2, Step 2.2