New product development is a method of bringing a product or service from idea to market. The process identifies several stages, which usually involve new products, starting with the generation of ideation and concept and ending with the market launch of the product. New product development is a process that has evolved over time. The method started as a linear process to a stage-gate process, and now it is called simultaneous engineering.
Linear new product development
With the generation of ideas, the modern product creation process begins. Ideas are the organized pursuit of ideas for future products. Typically, an enterprise produces hundreds, maybe thousands, of ideas to ultimately find a handful of good ideas. It is possible to identify two origins of new ideas. The first origin is internal innovations, whereby the organization internally seeks fresh ideas, meaning that ideas can come from the employees. The second is the external sources of an idea, where the company externally seeks fresh ideas.
The next step in the new method is the screening of ideas. Screening ideas means nothing but filtering out good ideas.
Concept development and testing
Suppose one wants enticing concepts to be transformed into a product design for the new product development process. A product concept is a detailed version in meaningful market terms of the new product idea. The idea passed the screening of the idea and must now become a definition. This latest product is to be developed into alternative product ideas for the marketer (Relich & Pawlewski, 2018). Then the company learns what makes every idea appealing to consumers and selects the best. The idea then is put into testing.
Marketing strategy development
The next step in the new product development process is marketing strategy development. When a promising concept has been developed and tested, it is time to design an initial marketing strategy for the new product based on the product concept for introducing this new product to the market.
In the fifth phase of the new product development process, revenue, costs, and profit estimates of the new product are reviewed to determine if these factors are meeting the company’s goals.
For actual product growth, the latest product development process continues. To this extent, there might be only a one-word definition, a sketch, or even a raw prototype for several modern product concepts.
The product and its proposed marketing campaign will be tested in actual market conditions at this point in the new product development phase.
The introduction of a new product on the market is nothing more than commercialization. The highest costs are incurred at this time: a production plant may need to be built or rented. In the first year, there will be large sums spent on advertisements, sales, and other marketing activities.
Stage-Gate New Product Development Process
The Discovery-to-Launch Process for Stage-Gate is the ‘industry standard used by organizations of all sizes worldwide in the management of product innovations. The concept behind Stage-Gate is that innovation in products is a valuation process that starts with concepts and ends after the successful launch of a product or service. This has much to do with the benchmarking research that the Stage-Gate process design is premised on (Kitsios & Kamariotou, 2020). It is a much broader, more holistic, and full cross-functional view of innovation than all other approaches.
Stages involved in the product development process
Stage 0 – Discovery
Activities to find potential market opportunities and create new ideas about products, services, and technology.
Stage 1 – Scope
Fast, cheap pre-examination and scope of an idea – mostly research – for defining the concept better, evaluating technological feasibility, and gaining insights into trade prospects.
Stage 2 – Business Case
Detailed analysis including primary research and market and technological trials leading to a business case, including a description of product/service and project, the rationale for the project, and the development strategy proposed.
Stage 3 – Develop
Detailed design and development of new products and services and the operations or manufacturing process for possible full-scale manufacture. Multiple alpha prototype iterations.
Stage 4 – Test and Validate
Marketplace, laboratory, and plant testing or testing to check and confirm the new product, brand/marketing strategy, and production/operations proposed. Several beta prototype iterations.
Stage 5 – Launch
Marketing – the start of full-scale or complete manufacturing, marketing, and sales operations. The change from invention to the process of product life cycle management.
Simultaneous engineering/Concurrent engineering
Simultaneous engineering is a method of designing and manufacturing products where the various phases operate at the same time, rather than in a row. The time for product creation and market time will be reduced, production will be increased, and costs will be reduced. The rapid cycle developers have a clear advantage in markets in which customers prioritize time compression (Rihar & Kušar, 2021). Furthermore, product technology output is continuously rising, and prices decrease almost daily in many higher technological areas such as electronics and telecommunications.
At times stage-gate remains the best method for the new product development regardless of the sophistication of the simultaneous engineering method. In cases where the machines desired to be used for simultaneous engineering, new product development method are not sophisticated enough, or they are suspected to be faulty, then it advisable to go for the stage-gate process as the method for the new product development.