Notes
Chapter 20 : Introducing New Market Offerings.
1.Challenges in New-Product Development : The company can develop new products in its own laboratories, or it can contract with independent researchers or new-product development firms to develop specific new products. We can identify six categories of new products.
1. New-to-the-world products
2. New product lines
3. Additions to existing product lines
4. improvements and revisions of existing products
5. Repositioning
6. Cost reductions
*Principles to guide New-product Development
1. Work with potential customers
2. Let employees choose projects
3. Give employees “dabble” time
4. Know when to let go. Most established companies focus on Incremental innovation. Never companies create disruptive technologies that are cheaper and more likely to alter the competitive space. Established companies can be slow to react or invest in these disruptive technologies because they threaten their investment.
*Factors hinder new-product development:
• Shortage of important ideas in certain areas
• Fragmented markets
• Social and governmental constraints
• Cost of development constraints
• Cost of development
• Capital shortages
• Faster required development time
• Shorter product life cycles
2.Organizational Arrangements Once a company has carefully segmented the market, chosen its target customers, identified their needs, and determined its market positioning, it is better able to develop new products. Many companies today use customer-driven engineering to design new products. Customer-driven engineering attaches high importance to incorporating customer preferences in the final design.
3:Organizing New-Product Development A venture team is a cross-functional group charged with developing a specific product or business. These “entrepreneurs” are relieved of their duties and given a budget, garages, where entrepreneurial teams attempt to develop new products.
Cross functional teams help to
1.Challenges in New-Product Development : The company can develop new products in its own laboratories, or it can contract with independent researchers or new-product development firms to develop specific new products. We can identify six categories of new products.
1. New-to-the-world products
2. New product lines
3. Additions to existing product lines
4. improvements and revisions of existing products
5. Repositioning
6. Cost reductions
*Principles to guide New-product Development
1. Work with potential customers
2. Let employees choose projects
3. Give employees “dabble” time
4. Know when to let go. Most established companies focus on Incremental innovation. Never companies create disruptive technologies that are cheaper and more likely to alter the competitive space. Established companies can be slow to react or invest in these disruptive technologies because they threaten their investment.
*Factors hinder new-product development:
• Shortage of important ideas in certain areas
• Fragmented markets
• Social and governmental constraints
• Cost of development constraints
• Cost of development
• Capital shortages
• Faster required development time
• Shorter product life cycles
2.Organizational Arrangements Once a company has carefully segmented the market, chosen its target customers, identified their needs, and determined its market positioning, it is better able to develop new products. Many companies today use customer-driven engineering to design new products. Customer-driven engineering attaches high importance to incorporating customer preferences in the final design.
3:Organizing New-Product Development A venture team is a cross-functional group charged with developing a specific product or business. These “entrepreneurs” are relieved of their duties and given a budget, garages, where entrepreneurial teams attempt to develop new products.
Cross functional teams help to