Editing New product development (section)

== Management ==
The following are types of new product development management structures:

=== Customer-centric product development ===
Customer-centric new product development focuses on finding new ways to solve customer problems and create more customer-satisfying experiences. Companies often rely on technology, but real success comes from understanding customer needs and values. The most successful companies are the ones that differentiated from others, solved major customer problems, offer a compelling customer value proposition, and engage customers directly,<ref name=hw /> and systematically.<ref>{{Cite journal|title=Manage Customer Centric Innovation Systemically|url=https://hbr.org/2006/04/manage-customer-centric-innovation-systematically|access-date=|journal=Harvard Business Review|date=April 2006|language=en|last1=Selden|first1=Larry|last2=MacMillan|first2=Ian}}</ref>

=== Systematic product development ===
Systematic new product development focuses on creating a process that allows for the collection, review, and evaluation of new product ideas.<ref>{{Cite journal|last1=Shipley|first1=Thomas A.|last2=Armacost|first2=Robert L.|date=1993-09-01|title=Systematic approach to new product development|url=https://dx.doi.org/10.1016/0360-8352%2893%2990289-A|journal=Computers & Industrial Engineering|language=en|volume=25|issue=1|pages=333–336|doi=10.1016/0360-8352(93)90289-A|issn=0360-8352|url-access=subscription}}</ref>

Having a way in which employees, [[suppliers]], [[Distribution (marketing)|distributors]], and dealers become involved in finding and developing new products is important to a company's success.<ref>{{Cite web|title=A systematic new product development methodology for creating affective products|url=https://www.researchgate.net/publication/333521330|access-date=2022-02-25|website=ResearchGate|language=en}}</ref> Co-ordinated (and often early) involvement of suppliers in new product development has been seen as productive and generally advocated since the 1980s.<ref>Lakemond, N., Berggren, C. and van Weele, A., [https://onlinelibrary.wiley.com/doi/10.1111/j.1467-9310.2005.00415.x?msockid=1ab71a54a4f86ae5158e099ba5a06b4b Coordinating supplier involvement in product development projects: a differentiated coordination typology], ''R&D Management'' 36, no. 1, 2006, {{doi|10.1111/j.1467-9310.2005.00415.x}}, accessed on 3 February 2025</ref> '''Early supplier involvement''' (ESI) is generally seen as cost-reducing, although account also needs to be taken of the danger of being locked into a supplier who can press for higher prices.<ref>Oxford College of Procurement and Supply, [https://www.oxfordcollegeofprocurementandsupply.com/the-importance-of-early-supplier-involvement/ The Importance of Early Supplier Involvement], accessed on 5 April 2025</ref> The [[Chartered Institute of Procurement & Supply]] sets out four ESI phases:
#Concept stage: initial design and sales forecasting
#Specification of supply requirements with supplier input, quantifying orders and safety stock requirements, and confirming supplier selection
#Working with the supplier on quality control, delivery standards and investment costs
#Adopting a manufacturing methodology and securing efficiencies.<ref>Chartered Institute of Procurement & Supply, [https://www.cips.org/intelligence-hub/supplier-relationship-management/early-supplier-involvement What is early supplier involvement?], accessed on 5 April 2025</ref>

Cost transparency, backed by appropriate [[contract terms]] and supplier audit requirements, can help a business to avoid being disadvantaged by undue supplier pressure.<ref>Next Level Purchasing Association, [https://www.certitrek.com/nlpa/news/purchasing-articles/early-supplier-involvement/ 6 Early Supplier Involvement Tips], accessed on 5 April 2025</ref> It is also important for companies to have a process in place for monitoring [[Competition|competitors]] and their products so that they can stay ahead of them.{{citation needed|date=March 2023}}

==== Innovation management ====
In order to successfully manage the new product development process, companies must have an [[innovation management]] system in place. This system helps to ensure that all aspects of new product development are taken into account and that the company is able to track and assess the progress of new products. The innovation management system should also help to foster a [[culture of innovation]] within the company, which can help to increase the chances of success for new products.{{citation needed|date=March 2023}} Marketing writers Hyman and Wilkins argue that a company's rate of product innovation should fit between the extremes of being so rapid that "its core range decays" and so slow that its product range "become[s] obsolete".<ref name=hw>Hyman, J. and Wilkins, A., [https://static1.squarespace.com/static/5fc659a516f6d44b07e3cc93/t/5ffb1884d756af1ec08d0ab7/1610291334534/Where-customers-needs-meet-suppliers-expertise.pdf Where customers’ needs meet suppliers’ expertise (getting Marketing back to its roots)], Creative Problem Solving Group, ''Communiqué'', volume 13, pp 21-25, 2002, accessed 29 August 2023</ref>

===== Innovation manager =====
An innovation manager is a senior person appointed to be responsible for implementing and managing the innovation management system.{{citation needed|date=March 2023}} They are also responsible for ensuring that all aspects of new product development are taken into account and that the company is able to track and assess the progress of new products.{{citation needed|date=March 2023}}

===== Cross-functional innovation management committee =====
A cross-functional innovation management committee is a team of individuals from different company departments, including [[marketing]], engineering, design, manufacturing, and [[research and development]], who are responsible for overseeing and managing the new product development process. This committee helps to ensure that all aspects of new product development are taken into account and that the company is able to track and assess the progress of new products. Companies may get a better overall picture of new product development by putting together a cross-functional team, which can help generate fresh ideas and give assistance in evaluating them.

===Other techniques===
In addition, companies can use [[virtual product development]] to help reduce costs. This process uses collaboration technology to remove the need for co-located teams, which can result in significant cost savings such as a reduction in G&A (general & administrative) overhead costs of consulting firms.{{citation needed|date=April 2025}}

Another way to reduce the cost of new product development is through the use of 24-hour development cycles. This approach allows companies to develop products more quickly and at a lower cost. By using a 24-hour cycle, companies can shorten the time it takes to get a product to market, which can give them a competitive advantage and capability that can be extremely useful in cases where there is a sudden change in market conditions or customer needs.{{citation needed|date=April 2025}}

=== Use in turbulent times ===
In difficult economic times, it is even more important for companies to focus on innovation and new product development.<ref>{{Cite web|date=2020-10-18|title=Why innovation is crucial during a crisis|url=https://www.capgemini.com/2020/10/why-innovation-is-crucial-during-a-crisis/|access-date=2022-02-25|website=Capgemini Worldwide|language=en-US}}</ref><ref>{{Cite web|title=Innovation in a crisis: Why it is more critical than ever {{!}} McKinsey|url=https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/innovation-in-a-crisis-why-it-is-more-critical-than-ever|access-date=2022-02-25|website=www.mckinsey.com}}</ref> Oftentimes, such situations result in a short-sighted focus on cost-cutting and a reduction in spending on new products. However, companies that are able to innovate and create new products will be better positioned for the future.

Although counter-intuitive,{{why|reason=Why is new product development in tough times counter-intuitive?|date=April 2025}} tough times may even call for a greater emphasis on new product development. This is because companies need to find ways to meet the changing needs and tastes of their customers. Innovation can help a company become more competitive and better positioned for the future. By using a variety of methods, such as virtual product development and 24-hour development cycles, companies can reduce the cost of new product development and improve their chances of success.