September 9, 2004 -- SEATTLE, Wash., U.S.A. -- Jobwerx News -- Perfecting the process of new-product introduction, as reported by Chris Cookson and Troy R. Pliska -- All companies manufacturers and service providers bring new products to market at one time or another. But only a minority have actually perfected the process of new-product introduction.

Many companies are good at generating innovative ideas for products. However, very few companies consistently commercialize those ideas by bringing new products to market on time and within budget. In fact, the ability to effectively introduce new products and services in a timely, repeatable manner is relatively rare. Of course, taking an idea from drawing board to market at speed and with minimal cost is exceptionally difficult. But it also is essential. Consider that revenue generated by an average product in its first two years is now thought to account for between 35 and 50 percent of that products lifelong income potential. In some industries, such as electronics, high tech, and pharmaceuticals, that percentage is even higher. Whatever the industry, a week of launch-slippage usually means that major market opportunities often equating to millions of dollars have been squandered. And very little of that amount is recoverable.

What Exactly Is New-Product Introduction?

Think of new-product introduction as a process that begins when the initial design for a product is relatively complete (say, in the pre-release phase) and concludes when that product is satisfying market demand at volume production.

Nearly all manufacturers could benefit from better new-product introduction processes. However, companies with the most to gain from an NPI-improvement initiative are those with a high proportion of future profits tied to the successful launch of new products. This means companies that introduce new products or upgrades on a frequent basis; companies with ever-shortening product lifecycles; and those with large advertising and promotion budgets associated with new product launches, such as the fashion and automotive industries. Companies with numerous suppliers or complex supply networks (outsourced contract manufacturers, design houses, distributors, and logistics providers, for example) also are likely NPI-improvement candidates.

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