Lesson 11: Managing the New Product Development Process

Lesson 11: Managing the New Product Development Process

Introduction and Objectives

For many firms, successful new product development is critical for their survival. In a number of industries--such as computer hardware and software, telecommunications, and automobile manufacturing--more than 95% of all new product development projects fail. This makes it imperative to find methods and processes for developing new products quickly, effectively, and efficiently.

This lesson provides an overview of some of the best practices for improving both the effectiveness and efficiency of new product development. First, we will be looking at the key objectives of the new product development process. Then we will examine the major methods and tools that can be used to achieve these strategic objectives.

Learning Objectives

After completing this lesson, you will be able to do the following: 1. Outline the three goals that new product development projects must achieve in order to

be considered successful.

2. Explain the major reasons for the failure of major new product development projects.

3. Distinguish between the sequential and partly parallel development processes.

4. Identify the benefits and limitations of the sequential and partly parallel development processes.

5. Evaluate the role of project champions in the new product development process.

6. Evaluate the merits of involving customers and suppliers in the new product development process.

7. Identify the leading tools used to improve the new product development process.

8. Explain the stage-gate processes and their importance in improving the new product development process.

9. Explain how to apply the appropriate tools--including stage-gate, quality function deployment, design for manufacturing, and computer-aided design/computer-aided manufacturing--to selected new product development projects.

10. Identify the metrics and tools used to evaluate new product effectiveness and innovation performance.

11. List several factors that have been hypothesized to increase or decrease product development cycle time.

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Readings and Key Terms

Required Readings

Textbook, Chapter 11: Managing the New Product Development Process

Lesson Note 11.1: Factors Affecting Product Development Cycle Time

Simester, D. (2016). Why great new products fail. MIT Sloan Management Review 57 (3), 33-39. In the DRR.

Supplementary Reading

Lin, R. (2016, August 31).Top 10 main causes of project failure [Web log post]. Project Management. In the DRR.

Key Terms

Be sure you know the meaning of the following key terms before you move on to the next lesson:

computer-aided design (CAD) design for manufacturing (DFM) development cycle time failure modes and effects analysis (FMEA) go/kill decision points lead users partly parallel development process quality function deployment (QFD) sequential development process stage-gate process

To test your understanding of these key terms, try the interactive key terms exercise for this lesson.

Discussion Questions

The Online Discussion is your place to express opinions, raise issues, and provide relevant examples of the material being offered in the course. Your participation in the discussion forums is worth 10% of your final grade in the course. Discussion Question 11

Watch the Dilbert cartoon video "Why Projects Fail" and answer the following questions:

1. What are the main issues that caused this project to fail?

2. What should have been done to avoid it?

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Join the discussion in the Discussion Question 11 forum.

Learning Activities

The Learning Activities in this course provide opportunities for you to apply the knowledge you are gaining to real-world scenarios. If you have difficulty with any questions, review the relevant material and, if necessary, contact the Student Support Centre for assistance. Learning Activity 11

Read the Chapter 11 opening case study, "Skullcandy: Developing Extreme Headphones" on pages 235-240 of the textbook, and answer the four discussion questions that follow.

1. How does Skullcandy's new product development activities affect its ability to

a. maximize the fit with customer needs, b. minimize development cycle time, and c. control development costs?

2. What are some of the ways that Skullcandy's size and growth rate influence its development process?

3. What are the advantages of using Computer Aided Design (CAD) and stereolithography to create prototypes of Skullcandy's headphones?

4. If you were advising the top management of Skullcandy about new product development processes, what recommendations would you make?

Compare your answers with the Suggested Solutions to Learning Activity 11.

Review Questions

Answer these review questions without referring to your notes, textbook, or readings. Compare your responses with the Suggested Solutions to Review Questions. If you have difficulty with any of these questions, review the relevant material and, if necessary, contact the Student Support Centre for assistance.

1. What are the key objectives of the new product development process?

2. Distinguish between the sequential and partly parallel development processes. What are the benefits and limitations of each method?

3. Are there some industries in which a parallel process would not be possible or effective?

4. What is the purpose of involving project champions in the new product development process? Are there any risks involved? What are some ways firms may access the

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benefits of championing while minimizing the risks?

5. What are the five myths about product champions identified by Markham and Aiman-Smith (textbook, p. 246)?

6. What are the merits of involving customers and suppliers in the development process?

7. What is the purpose of stage-gate processes in the development of new products? What components are evaluated at each gate?

8. Describe the purpose of the quality function deployment (QFD) process. What are the steps necessary to complete the house of quality matrix?

9. Describe the benefits of a) design for manufacturing and b) computer-aided design and manufacturing.

10. Why is it important to numerically measure and assess the new product development process? What are some key considerations when undertaking this type of assessment?

11. Describe the tools used to measure new product development effectiveness and innovation performance.

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