New Product Development
Numerous sources attest to the significance of new product development (or innovation) to companies’ growth strategies:
- More than 70 percent of senior executives in a recent survey cited Innovation as one of the top three drivers of growth for their companies in the next 3 to 5 years and as a top corporate priority.
- 66 percent of senior executives also confirmed that their organizations’ business strategy is either totally or largely dependent on Innovation.
New Product Development Issues and Challenges
While most companies acknowledge that effective New Product Development is a key to long-term competitive advantage and growth, most also acknowledge that they lack rigorous, repeatable processes for generating good ideas and converting those good ideas into profit:
More than 50 percent of new products launched by a company will fall short of executives’ expectations.
1 in 100 new products cover their development costs.
1 in 300 products make a significant difference to customer purchase behavior, the product category, or the company’s growth trajectory.
65 percent of senior executives admit they are only “somewhat”, “a little”, or “not at all” confident about the decisions they make to stimulate innovation.
19 percent of executives also confess that innovation does not factor into the strategic-planning process (in spite of being an essential driver of growth).
15 percent of executives state that they are “very satisfied” with their company’s ability to convert ideas into service offerings, and only 13 percent said they can do it repeatedly.
We help clients balance a willingness to terminate a product concept with the tenacity to persist until a product’s potential is realized. Walking the line between over-investment in some areas and under-investment in others can be extremely difficult. Our consultants understand that the path to success is through the application of a rigorous, balanced process for evaluating any idea prior to entering the standard, stage-gate development process. By assessing a product’s viability against a set of practical, factual criteria, companies can determine outright whether a product has the right market and customer base, and is supported by the internal capabilities necessary, for a successful introduction to the market.
Frost & Sullivan’s start-to-finish approach to New Product Development can help you:
- Gain a strategic view of a market’s stability
- Find out what your most progressive customers are doing
- Determine an innovation concept’s fit with company resources
- Diagnose process or skill gaps that could hinder development efforts