We have spoken to many senior leaders who are frustrated with their product development processes and who believe that despite their best efforts, most products move forward because of “gut feel” rather than a detailed and consistent market assessment. Developing solid rationale and requiring a business case that includes an appropriate market assessment should be a requirement for advancing a new product or service concept to market. The business case, and its market assessment section, is an integral part of a successful product development process. An effective market assessment by the new product champion(s) and the related product team(s) dramatically improves the chances of successful new product launches which are a key component of competitiveness and high levels of financial performance.
The “10 Key Questions” approach to an effective market assessment helps the product team review and refine the product concept and do the homework necessary to champion the product effectively. Addressing these questions and documenting the findings via this approach is a guiding influence of the “Concept Development” phase of a stage gate based new product development process. A well designed market assessment tool helps create critical inputs to the, Investigation, Analysis, Conceptualization and Benchmarking phases of stage-gate based product development process. These subsequent phases will validate, refute or refine the information gathered by applying this tool.
The “10” Key Questions that need to be answered to advance a product idea toward potential market launch are:
- What is the unmet market need or problem that is being solved with this product or service?
- What is the market size, its growth and key trends?
- Why does the problem exist now and how long will it exist in the future? What current and/or emerging key factors (economic conditions, regulations, competition, technology, other trends, etc.) might impact this?
- What is the company’s proposed solution including products and services?
- What unique benefits will the new product provide to the consumer: lower cost, unmet need, ease of use, etc.?
- How will this solution provide the company with sustainable competitive advantage and why do we think we can solve this problem better than our competitors and how can the product solution be protected by patents, IP, trade secrets, etc.?
- How does this solution fit with the company’s strategy for products, brand, competencies/capabilities, processes, infrastructure, channels of distribution?
- What is the complexity of implementation: Will we have to build or acquire new technology and what resources will be required to commercialize this solution?
- Does the Lifecycle Revenue Model predict that this solution will meet the minimum return on capital and our ability to fund cash flow requirements: ROI?
- What are the risks if we proceed or stop?
A detailed business case that outlines the market needs and the Product Lifecycle Revenue Model will enable the product team to effectively present the new product concept to the company’s senior leadership. Following a well-defined process (such as Group50’s MPD process) will increase the probability of a “go” regarding continuing resourcing of the product concept. At each of these stages, a go-no-go decision is made by a senior leadership team.
Each of these questions have many sub questions that good market assessment tools require answers to. There is a required discipline behind using these tools, one that most leadership teams don’t have because new products need to be done “NOW” and typical marketing and product development teams believe that new product development is more “Art” than “Process”. We believe that new product development is 10% creative and 90% process. We have found that most companies would save a lot of wasted effort if they were more disciplined and that discipline would result in shorter lead times to market, fewer product mistakes, higher profit margins and increased market share.
If you want to learn more about Group50’s MPD process and how it can significantly improve the success of your new product pipeline, feel free to call a Group50 Market Effectiveness and product development expert at (909) 949-9083, send a note to email@example.com or request more information here.
About the author: Jim Gitney is the CEO of Group50® Consulting and specializes in the development and implementation of manufacturing and supply chain strategies. Jim is considered a product development expert who played key roles in the launches of products such as SnakeLight, DeWalt, and other well-known products. Jim and the Group50 team are all former executives with well-known manufacturing and distribution companies who understand what it takes to design and implement a successful product development process that increases a company’s Market Effectiveness and optimizes the Product Lifecycle Revenue model.
- Video Explanation of the Business Hierarchy of Needs®
- Strategy 5.0™ – Defining the Appropriate Organization Design for a Digital Future
- Strategy 5.0™ – Where to Play, How To Win, Most Important Goal
- Cost Takeout as a Strategy
- What is the Business Hierarchy of Needs®?
- Five Things You Need To Do To Drive Continuous Improvement – Introduction
- Five Things You Need To Do To Drive Continuous improvement – Part IV – Best Practices
- What is a “ Brown Paper Exercise “ and What is its’ Value?
- Industry 5.0, People – Process – Technology – Cobotics
- Industry 5.0 – IoT and Blockchain – An Application Case Study – Flight Safety Parts