New Product Development: Overcoming Challenges
Developing a new product is difficult, however it should not feel unplanned, out of control or daunting! Identifying risks and challenges during the development process is key to planning, ensuring mitigating actions are in place, avoiding costly and time-consuming delays.
Three of the most common pitfalls for new businesses or complex projects are:
Funding: Securing sufficient investment, and ensuring budgets include all expected costs are critical success factors. A shortfall in cash leads to extensive delays whilst raising additional investment. There are multiple methods of sourcing project finance including:
Funding from Business Profits
Investment from Family & Friends
Funding from government grants can be attractive, particularly to de-risk innovative solutions and prove early-stage ideas. However, the application process requires due diligence. Writing a convincing application and putting this on paper is a skill to be learned and success is unlikely first-time round. Outsourcing advice or experienced support to complete and review the application may be the key to securing project funding.
Tip: Do not rush a grant application, resource the application fully, complete research around the idea, technologies, and markets. Maximize the probability of success. Seek expert reviews and listen to feedback.
When identifying funding needs then identifying the total project cost is critical to avoid returning additional funding. Make sure to include:
· Costs of development tools, kits, and equipment.
· Resource costs for the product design and development.
· Product testing and evaluation costs.
· Contingency for additional prototypes and builds, should something not go as planned.
· Business costs for setting up new processes, e.g., Quality Management Systems.
· Capital expenditure costs for manufacturing tooling, jigs, and fixtures.
· Product Approvals costs
· Travel costs for visiting suppliers
· Start-up costs for procuring initial stock for launch.
· Marketing costs include content creation, events, advertising, and social media.
Tip: Budget using scenarios and work out a typical, optimistic, and pessimistic cost.
Resources:
Identifying the team to execute a successful project has become more challenging as product complexity has evolved from simple physical products to connected system solutions. Teams are often now a blend of internal resources, consultant support, external suppliers, academic experts, and freelance support.
Resources needed include:
· Project Management: is vital in collaborative, complex projects and helps avoid costly mistakes. Effective project managers enable teams to achieve goals and succeed.
· Quality Management: is essential when designing and manufacturing a physical product. Ensuring business processes are adequate for compliance and suppliers meet compliance, environmental and sustainability goals require specific attention.
· Procurement & Supply Chain Management ensures selected suppliers are likely to be good long-term partners with the capabilities and culture that fit with the project and business goals.
· Technical Specialist – Mechanical, Chemical, Electrical / Electronic, Embedded, Software or Manufacturing. Do the team have prior experience working with the specific technologies and parts that may be used? If not, where can these capabilities be found? Is an academic partner required to bring specific expertise?
· Regulatory & Testing Support is essential to ensuring compliance both locally and globally.
· Branding, Marketing & social media must be considered from the outset and be inherent within the designed solutions. Delivering solutions consistent with brand objectives requires the development teams to understand the business brand, brand values and in addition the persona of the target customers.
Outsourcing specific resources can be highly beneficial for the project, especially if more advanced skills and knowledge are required to make sure the project moves forward effectively at a pace.
Tip: Utilize external resources and best practice, network, learn, collaborate, and improve.
Timescale: Avoid scope creep to keep your project on time and on budget. When planning then identify critical paths and dependencies and seek to minimize time to market. Create sprints around knowledge gaps and learn as fast as possible to de-risk the project.
There are multiple methods of project management that can be used to help keep track of projects timescale, there are:
Our Tips:
Identify key deliverables and memorable dates, celebrate reaching these mini milestones. Create a successful momentum!
Embrace critical review – listen to concerns from experts and stakeholders and act to mitigate these.
Avoid technical debt and risk – do not push this to later stages of the project.