NEW PRODUCT DEVELOPMENT PROCESS

Topics: Marketing, Strategic management, Product management Pages: 6 (1505 words) Published: December 29, 2014
DRAFT PROPOPSAL OF NEW PRODUCT DEVELOPMENT
For every successful new product, many new product ideas are conceived and discarded. Therefore, companies usually generate a large number of ideas from which successful new products emerge. I work as a strategic manager in Solarland Co., Ltd. This company does business of electronic appliances. As a Strategic Manager, I have been directed by my BOD to introduce a new product in Bangladesh. I want to introduce a Solar Based LED TV which will be run with solar system, which is without electricity people will be able to watch TV. So I have gone through my knowledge which I gained from my Strategic Management course and then make a draft of my proposal for them. The draft of my proposal for introducing a new solar based LED TV is discussed below. 1. Idea Generation

The new product development process begins with idea generation. Strategic management is all about selling an idea. So as a Strategic manager I have created the new product idea of Solar Based LED TV. I have created this idea as I want to capture a new market where people do not have enough electricity or else they will also be able to safe electricity cost. This new product can define the overall character and mission of our company. 2. Idea Screening

Idea screening, the second step, considers the new product idea of developing a Solar Based LED TV. At this stage I consider not only the firm's manufacturing, technology, and marketing capabilities, but also how the new idea fits with the company's vision and strategic objectives. During screening the idea I consider some facets which are very important like: What are the purposes of the organization?

What image should the organization project?
What are the ideals and philosophies that the organization desires its members to posses? What is the organizations business?
How can the organization best fulfill its corporate objectives?

3. Concept Development and Testing

The third stage, concept development and testing, requires formal evaluations of the product concept by consumers, usually through some form of marketing research. As a strategic manager, to build up a self-concept is very important. Self-Concept refers to the distinctive competence or major competitive advantages of the company. In case of concept testing, the existing strategic plan should be compared with the best plan which can be developed at any given point in time. So the best conceivable plan becomes the standard. The degree to which the existing plan varies from the standard and the cost of that variation compared to the cost of revising the plan will determine whether corrective action should be taken.

Figure 1: New Product Development Process and Strategic Factors 4. Business Analysis
The business analysis stage is next. At this point the new product idea is analyzed for its marketability and costs. After passing the first three stages an idea may be discarded once marketing and manufacturing costs are analyzed, due to limited potential for profitability or commercial success. I can do it through Porter Five Forces analysis.

Figure 2: Factors of Industry Analysis

Threat of new entrants
Profitable markets that yield high returns will attract new firms. This results in many new entrants, which eventually will decrease profitability for all firms in the industry. Unless the entry of new firms can be blocked by incumbents  the abnormal profit rate will trend towards zero (perfect competition). So I will analyze the threat factor of new entrants. For my new product I found that potential threat of new entrants are very low.

Threat of substitute products or services
The existence of products outside of the realm of the common product boundaries increases the propensity of customers to switch to alternatives. So I need to assess whether there is any existing or potential substitute of our new product. As this new product will work without electricity, so threat of...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • New Product Development and Nestle Essay
  • Research on Develpment of New Products and Services Essay
  • Product Offering Essay
  • Essay about Defining Next-Generation Products an Inside Look
  • Describe waht is Product life cycle and explain its stages. Essay
  • Quality Metrics for the Product and Supply Chain Essay
  • New Product Development Essay
  • Essay about Managing Operations and Technology: The New Product Development Process

Become a StudyMode Member

Sign Up - It's Free