Samsung seems to be launching a range of cell phones in quick succession, one after another. ITC too is following the same track — they’re entering a number of categories rapidly. So what is it about these companies, that allows them to do such consistent, pioneering work? The answer is simple. It is ‘New product Planning’.
Even before developing a new product, it is important to start the planning process. Planning includes proactively understanding the current portfolio, assessing market opportunities and arriving at a set of new product ideas. This is the step that precedes any new product development activity.
Once these are done, the actual set of ideas need to be assessed across parameters like time horizon for development, perceived risk, and resource requirements. After all this can a final decision be taken, based on how the company has performed historically, as far as new product development is concerned.
Idea planning
Let us look at it one by one.
~ Understanding current portfolio : The existing portfolio may cater to different age groups, geographies, lifestyle segments or even different benefit seekers. The question that should be asked at this stage is whether the company has any vision of entering a new category or segment that has hitherto been uncharted. If so, a new product idea needs to be developed for that.
It is also important to know if the company has the required competencies to enter that area, as this answer will determine the extent to which the vision can be fulfilled, in the desired timeframe.
~ Assessing market opportunities : This is about looking at large gaps from a consumer’s point of view. Sometimes, competition may be present in one area but their ability to satisfy the consumer could be limited. This presents an opportunity for the company.
~ Finalising new product ideas : As mentioned earlier, there are many factors that need to be taken into consideration before taking forward the final set of ideas.
Assessment factors
~ Product development lead time : Based on the company’s urgency felt in the marketplace, new product ideas need to be mapped across different time horizons — short, medium or long term — to know which ones will fructify when. If there is a healthy balance of output expected across different times, then it is optimal from an organisation’s point of view.
~ Perceived risk : There are new product ideas that may never see the light of the day. The confidence level of the research and development team as well as the prior competencies in that area will help understand the perceived risk factor in any project. It is a strategic decision as to which projects are riskier than the others.
~ Resource requirement : While putting the idea into motion, resources need to be spaced out. While there may be many new product ideas that can be successfully developed, the commercialisation or market launch requires resources in terms of money, manpower and infrastructure. Whether the company can afford these, and if it can, how much can be balanced out, is a decision that has to be taken.
Therefore, to sum up, new product planning is an exercise that companies have to embark on continuously, if they are to see consistent success in the market.