As manufacturers around the world continue to improve existing products while simultaneously introducing new ones, having a well-organized plan remains fundamental to marketplace success. New product introduction processes assist in making this a reality by coordinating the work of increasingly globally dispersed teams to optimize real-time workflows and ultimately, deliver new high-quality products to the market that meet customer needs.
What is new product introduction?
New product introduction (NPI), also known as new product development (NPD), is how organizations bring innovative products and services to market. Many organizations use these acronyms interchangeably. However, NPI specifically refers to manufacturing and launching new products. NPD, on the other hand, is concerned with concept generation, the design process, and commercialization of these products. As such, there is significant overlap between the two as the process evolves from concept to development to launch. These carefully managed processes draw from the entire organization’s resources to ensure new products launch on budget and on schedule.
Benefits of new product introduction and new product development processes include:
- Quicker time to market
- Reduced development costs
- Higher quality products
- Lower risk of design flaws
As you can see, robust NPI plans have a significant impact on the bottom line, reducing upfront investments of capital and time while increasing profits and product lifecycles. However, successfully launching a new product can come with a number of unforeseen challenges, even if your organization has thorough knowledge of the market and a well prepared plan. The implementation of new product introduction processes ideally start before products have moved out of the stage with your design team. This not only indicates the end of the development process, but the beginning of the sales process as well.
New Product Introduction Process
New product introduction is guided by small, decentralized teams reporting to a primary decision maker. Inherently, they involve extensive cross-functional collaboration among the various divisions of an organization, promoting an invaluable degree of interconnectivity among internal and external teams. The new product introduction team helps to manage the workflow and ensure that communication between departments during the ramp up to launch remains smooth with positive cross-functional teamwork.
These teams typically consist of:
- A project manager (often, a product developer with NPI process or product management experience and/or certifications)
- Representatives from each department, such as marketing, finance, and operations/production team
- Stakeholders; there can be as many or as few of these as primary decision makers see fit
- Points of contact for any contract manufacturers and other contract work that might be required
Teams successfully implement plans for new product introduction which are:
- Unified across multiple disciplines
- Clear, relevant, and easy to understand
- Allocate resources to the right place at the right time
- Actively supported by management
Organizations can be better prepared for the all important entry of their product into the marketplace. Products can be delivered on time and on budget without sacrificing quality. In turn, sales and customer satisfaction are boosted, extending product lifecycles to yield significant revenue growth.
As global competition continues to intensify, innovators have found it necessary to increase design complexity while simultaneously compressing product launch cycles to ensure growth. This can pose a challenge to organizations looking to develop a NPI process that best fits their offerings. Keep in mind that processes vary extensively from company to company and even from division to division; it is a necessity to make plans for NPI relevant to your brand.
A common mistake is that of taking the new product introduction process for granted. You only get one chance to launch a product, so make sure to do so efficiently and conscientiously. Never make the assumption that everybody is on the same page and things are running smoothly. Check in early and often with team leads, as well as contractors, to avoid costly miscommunication.
Checklist for New Product Introduction
NPI processes are tailored to suit a project’s specific needs with regard to budget, timeline, and business objectives. As such, these processes will look very different between companies or even from project to project. The following serve as guidelines for each stage of new product introduction, starting with the pre-production planning. Keep in mind that each next phase builds on the previous one, making this process more cyclical than linear.
Step 1 - Planning
- Assemble the NPI team
- Define individual roles and the overall hierarchy within the team
- Assess what resources will be needed to conceptualize the product
- Turn project requirements into design specifications
- Review Service Level Agreements (SLAs) with suppliers
- Make expectations and deadlines clear to everyone involved
Step 2 - Determining Feasibility
- Use computer aided design (CAD) software to model the product
- Perform a Design for Manufacturing test to evaluate the design and how marketable it is
- Create process flow diagrams and/or workflows for product development; deliverables might include a boundary diagram, a preliminary design concept, or a process flow diagram
- Carry out an Engineering Verification test to further determine design viability (eg. how realistic mass production is)
Step 3 - Develop a Prototype
- Create a working prototype of the current product design
- Get feedback on the prototype from ideal users
- Decide on a manufacturing process and prepare the manufacturing space and production line
- Procurement of logistical resources for manufacturing, such as material forecasting, bill of materials, and shipment planning
Step 4 - Assess the Prototype and the Manufacturing Process
- Consider process risk
- Put a hold on any further design changes and revisions
- Prepare any molds or other specialized tools which may be needed to manufacture the product
- Begin to order materials for manufacturing
- Conduct a Product Validation test
- Determine pricing
Step 5 - Manufacture the Product
- Produce the good or service, performing frequent quality control tests
- Final quality assurance check
- Launch the final product on the market
Step 6 - Collect Feedback and Evaluate Performance
- Get customer feedback
- Within 30 to 60 days of product launch, evaluate NPI performance
- Take note of areas to improve on for next time
Prior to the completion of each stage, the NPI team should meet with management and any other key stakeholders to review their work before moving on to the next step. Read on for suggested pro tips and best practices for the NPI process.
Best Practices for New Product Introduction
As a modern means of accelerating product launch cycles, cloud-based systems enable the collaboration of cross-functional teams. This solution provides easily accessible visibility to all teams, ensuring that product launches occur more efficiently. Supply chain partners should also be integrated to make sure that everyone is on the same page from prototyping to launch.
Propel’s cloud-native solution has a number of unique advantages for the management of product development processes, including:
- Minimal setup; no installation or extensive training program required
- A single, secure source of information about product development
- Reductions in language barriers and global time differences
- Accessible, centralized, and up-to-the-minute product records ensure everyone is working off the latest design
- Automated processes and organizational data visibility that allow for continuous improvement
Working with experienced professionals is another means of optimizing the NPI process. Their knowledge of how to structure NPI for a specific product can prove invaluable. From start to finish, they make suggestions to organize the project.
By implementing Design for Manufacturing and Assembly (DFM/DFA), products can be optimized for efficient manufacturing. In alignment with NPI’s goal of manufacturing quality products on a consistent basis to best meet demand, DFM considers all aspects of the manufacturing process to prepare designs for mass production.
Learn more about how a modern cloud-based solution such as Propel Software can streamline your own NPI processes.