In engineering and manufacturing, product development encompasses the entire process of re-designing a previously produced product, upgrading an existing product, introducing a new product into a market or introducing a new product into a specific market segment. A key aspect of NPD is a product concept, with a variety of other business considerations being secondary. In some cases, companies only utilize the assistance of a skilled and licensed product developer. In other cases, a company relies upon a number of product development specialists, each bringing his or her own skill set and experience to the table.
The first step in the product development process is market research. Market research is designed to understand what customers need and how those needs might be addressed by the development of a new or improved product. Market research assists companies in determining what existing customers want, and how those needs may be satisfied by the development of a new or improved product. This step also assists in determining which market segments require the most or the unique solution, and it provides valuable insight into target markets.
Following market research, a company should then determine how to meet those customer demands. While the product development process may call for the expertise of many different specialists, a few core disciplines remain critical to successful development of a product development strategy. These core disciplines include:
* Business Analysis – Understanding how to better serve a customer requires an understanding of their business. This field is intimately connected to the planning process, as it is often the basis of many of the decisions made during product development. A strong understanding of business issues ensures that a designer is well-grounded in the basics of marketing, sales, management and other aspects of running a successful organization. Business analysis skills are necessary for developing products that are in line with customer needs. As such, many businesses seek the help of a consultant who has extensive experience in providing consulting services related to product development.
* Consumer Insight – Developing transformational products that can solve real-world problems requires gaining an understanding of what types of products most closely fulfill the customer’s needs. This requires collecting and analyzing consumer data. A data set should include survey information, interviews, focus groups and other methods of gathering information from real people. This information is important for understanding both current and potential problems consumers have, as well as the key channels through which they are finding information. Consumer insight is key to developing a comprehensive product development strategy.
* Market Strategy Development – In addition to gathering and analyzing consumer information integration, a strategic plan should also be developed to understand which market segments consumers feel are under-served and need a product development strategy. While many companies view product development as a strictly internal function, the reality is that a large component of the product development budget is dedicated to identifying under-served markets and developing solutions to these markets. A comprehensive marketing plan should also be developed, as this will enable a company to execute a cost-effective strategy across all channels. Additionally, a comprehensive marketing strategy will ensure that a new product strategy is effective at driving new product sales.