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Transforming the nature and scope of new product development

Transforming the nature and scope of new product development Purpose – Over the last several decades, product development efforts have seen unacceptably high new product failure rates. One important factor is the presence of competitors who can interfere with marketing strategy and force changes that sap resources and reduce success. As industries try to improve their success, line extensions, i.e. developing products similar but different to successful products, have become more common. Simultaneously, industries have reacted by refining the new product development (NPD) process to make it more reliable and accurate. The refined development techniques are so helpful in refining product benefits with which firms are familiar that they reinforce the pressure to extend the line. The result is overcrowded markets where destructive competition destroys profitability. A “blue ocean” strategy promises to change the destructive cycle of market crowding. Originally the framework focused on overall market strategy. However, it has a direct application to NPD. Revising the NPD process to incorporate a blue ocean viewpoint before the idea generation stage may reduce the failure rate and create breakthrough products that are not easily emulated. This paper aims to address this issue. Design/methodology/approach – The paper reviews the NPD literature as well as work implementing a blue ocean strategy. It delineates the tools developed for applying blue ocean concepts to strategy. The paper then applies a blue ocean approach to the NPD process with the objective of developing new products and services that are unhindered by competitive offerings. Implementing a blue ocean strategy involves four main actions and may be focused on six targets. The paper integrates the elements into a strategic opportunity product development matrix which may help practitioners. Moreover, it identifies at which stage of the new product development process blue ocean concepts should be introduced. Findings – The paper reveals that there are no unvarnished panaceas in product development. Applying a blue ocean strategy to avoid competition early in the product life cycle promises to reduce dangerous competition to allow the product to succeed. However, the gains will probably not extend indefinitely. It requires constant improvement and application of the concepts to gain a measure of sustainability. If firms are successful early, they may be able to defend gains in some areas to retain profitability, while seeking new blue oceans. Practical implications – Blue ocean applied to marketing strategy has seen large gains in success. Integrating efforts to find uncluttered market space holds the promise of increased success. It will also refine the NPD process. Originality/value – Blue ocean strategy has not been applied to the new product development process in the literature. The paper integrates the concepts of the strategy with the elements of product development. The result is a new approach toward success products and product introductions. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Product & Brand Management Emerald Publishing

Transforming the nature and scope of new product development

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References (33)

Publisher
Emerald Publishing
Copyright
Copyright © 2012 Emerald Group Publishing Limited. All rights reserved.
ISSN
1061-0421
DOI
10.1108/10610421211203097
Publisher site
See Article on Publisher Site

Abstract

Purpose – Over the last several decades, product development efforts have seen unacceptably high new product failure rates. One important factor is the presence of competitors who can interfere with marketing strategy and force changes that sap resources and reduce success. As industries try to improve their success, line extensions, i.e. developing products similar but different to successful products, have become more common. Simultaneously, industries have reacted by refining the new product development (NPD) process to make it more reliable and accurate. The refined development techniques are so helpful in refining product benefits with which firms are familiar that they reinforce the pressure to extend the line. The result is overcrowded markets where destructive competition destroys profitability. A “blue ocean” strategy promises to change the destructive cycle of market crowding. Originally the framework focused on overall market strategy. However, it has a direct application to NPD. Revising the NPD process to incorporate a blue ocean viewpoint before the idea generation stage may reduce the failure rate and create breakthrough products that are not easily emulated. This paper aims to address this issue. Design/methodology/approach – The paper reviews the NPD literature as well as work implementing a blue ocean strategy. It delineates the tools developed for applying blue ocean concepts to strategy. The paper then applies a blue ocean approach to the NPD process with the objective of developing new products and services that are unhindered by competitive offerings. Implementing a blue ocean strategy involves four main actions and may be focused on six targets. The paper integrates the elements into a strategic opportunity product development matrix which may help practitioners. Moreover, it identifies at which stage of the new product development process blue ocean concepts should be introduced. Findings – The paper reveals that there are no unvarnished panaceas in product development. Applying a blue ocean strategy to avoid competition early in the product life cycle promises to reduce dangerous competition to allow the product to succeed. However, the gains will probably not extend indefinitely. It requires constant improvement and application of the concepts to gain a measure of sustainability. If firms are successful early, they may be able to defend gains in some areas to retain profitability, while seeking new blue oceans. Practical implications – Blue ocean applied to marketing strategy has seen large gains in success. Integrating efforts to find uncluttered market space holds the promise of increased success. It will also refine the NPD process. Originality/value – Blue ocean strategy has not been applied to the new product development process in the literature. The paper integrates the concepts of the strategy with the elements of product development. The result is a new approach toward success products and product introductions.

Journal

Journal of Product & Brand Management – Emerald Publishing

Published: Feb 24, 2012

Keywords: New product development; Product development; Blue ocean strategy; New product failure rates; Market crowding; Corporate strategy

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