Best Practices - Strategic Framework

The product introduction process is one of the two primary business processes:

Product introduction is a highly complex activity. It can be more easily understood by studying some of its constituent parts:

Strategic Framework Product introduction must be considered in a strategic framework. Top level decisions and policies determine, to a large extent, the overall product introduction performance.

Product Strategy

The Product Strategy is the plan for the products; it documents how the products support the business strategy. It covers:

Ø     Which new products are to be sold and to whom
Ø     The new products that need to be developed
Ø     Which products are to be removed from the product range
Ø     The platform products required

Together with the Marketing Strategy, the Product Strategy determines the architecture for the product introduction process. A platform product is a basic product that, with relatively minor changes, can be developed into a series of products or a product family. Once a platform has been developed new products can be rapidly introduced at a low cost. The automobile industry exemplifies this approach - a base car is developed and then sold in many variants, eg. 1.6L, 2.0GLX, 2.0CDX.

Technology Strategy

The Technology Strategy identifies how the company is to work with various product and process technologies:

• R&D plans for core technologies (technologies that are critical to the success of the business)
• Design modules that can be incorporated into several products and / or platforms.

Modular designs decrease parts variety, design costs, risk and time to market - they should be used where ever possible.

Measures of Performance for Product Introduction

Measures of performance (MOPs) for product introduction should be in-line with the measures on the business. There are, however, some issues round MOPs that are unique to new product introduction that must be addressed:

• It is difficult to isolate Product Introduction’s contribution to business performance from the other activities
• The time lag between product introduction effort and financial return makes it difficult to make timely decisions
• By definition, product introduction projects are all different and unique. Consequently, it is difficult to make comparisons of one project with another. Just because one project lasted six months does not necessarily mean that an improvement for the next project would be five months
• Some engineers believe that MOPs for product introduction discourage creativity.

The type of product introduction project determines the measurement technique that should be adopted.