“We must have the wrong consumers” – a case study on new food product development failure

Does strategic planning enhance or impede innovation and firm performance? The current literature provides contradictory views. This study extends the resource-advantage theory to examine the conditions in which strategic planning increases or decreases the number of new product development projects and firm performance. The authors test the theoretical model by collecting data from 227 firms. The empirical evidence suggests that more strategic planning and more new product development (NPD) projects lead to better firm performance. Firms with organizational redundancy benefit more from strategic planning than firms with less organizational redundancy. Increasing R&D intensity boosts both the number of NPD projects and firm performance. Strategic planning is more effective in larger firms with higher R&D intensity for increasing the number of NPD projects. The results reported in this study also consist of several findings that challenge the traditional views of strategic planning. The evidence suggests that strategic planning impedes, not enhances, the number of NPD projects. Larger firms benefit less, not more, from strategic planning for improving firm performance. Larger firms do not necessarily create more NPD projects. Increasing organizational redundancy has no effect on the number of NPD projects. These empirical results provide important strategic implications. First, managers should be aware that, in general, formal strategic planning decreases the number of NPD projects for innovation management. Improvised rather than planned activities are more conducive to creating NPD project ideas. Moreover, innovations tend to emerge from improvisational processes, during which the impromptu execution of NPD activities without planning spurs “thinking outside the box,” which enhances the process of creating NPD project ideas. Therefore, more flexible strategic plans that accommodate potential improvisation may be needed in NPD management since innovation-related activities cannot be planned precisely due to the unexpected jolts and contingencies of the NPD process. Second, large firms with high levels of R&D intensity can overcome the negative effect of strategic planning on the number of NPD projects. Specifically, a firm's abundant resources, when allocated and deployed for NPD activities, signal the high priority and importance of the NPD activities and thus motivate employees to acquire, collect, and gather customer and technical knowledge, which leads to creating more NPD projects. Finally, managers must understand that managing strategic planning and generating NPD project ideas are beneficial to the ultimate outcome of firm performance despite the adverse relationship between strategic planning and the number of NPD projects.

New product development (NPD) is essential for business success and growth. High- to medium-technology manufacturing sectors have introduced standard models. The adaptation of these systematic NPD procedures supported by appropriate decision support tools has provided significant benefits in production cost, product quality and supply chain availability. However, the challenges involved in NPD of food are rapidly increasing due to consumer demand for organic and healthy diets, in particular, more nutritious low-calorie food, and preference for customised and personalised food products. This has resulted in a proliferation of new varieties, types and shapes of food products that are constantly introduced. Most of these new products are developed based on company-specific ad hoc NPD procedures, within small to medium enterprises that form the biggest proportion of food producers in most developed countries. This highlights a need for further research into novel NPD methods and tools in the food sector. This communication provides an overview of the NPD processes, analyses their strengths and shortcomings and outlines critical missing capabilities for food manufacturers in specific.

New product development (NPD) is widely recognized as an important source of being a competitive advantage. It can bring considerable returns to an organization but can also be considered a risky process, such as making wrong decisions in the project selection or suffer consequences from using inexperienced project teams. This study aims to develop a risk management model to help NPD teams in managing risks with their projects. The conceptual framework is developed from three sources of publications; systematic literature review of academic research during year 2002-2012, the project management body of knowledge from a professional association and the international standards related to risk management. The model consists of risk identification and the risk analysis process to use for the prioritization of risk factors. Thirty-nine risk factors were identified during the study and the risk breakdown structure (RBS) for food NPD with twenty risk categories have been developed and used for risk identification. The model has been validated by four case studies of NPD projects in the food industry of Thailand. The major risks found in these case studies were the quality of raw materials, trade barriers for export, understanding of customer requirements, inconsistency of raw material costs, communication problems between R&D and the manufacturing team, NPD team knowledge in project management, human resource constraints and product formulation for scale-up.Refined risk assessment models have been used to develop risk assessment tool, consisting of risk identification by RBS and a risk checklist, and risk analysis by fuzzy inference systems. Some suggestions for risk response strategies have been studied and discussed in this research. This integrated tool can be further developed and commercialized as suggested in a business plan to use by NPD teams as a roadmap and process work-flow for risk management of a NPD project in the food industry. The user acceptance test for prototype of a risk assessment tool from research showed results of a 90.5% acceptance rate by users in the NPD team.

Purchasing involvement in new product development: An absorptive capacity perspective

New product development (NPD) is one of the important operations for the sustainable company, and the performance of NPD is a very serious concern for the company profit making. Properly evaluating NPD project performance could greatly benefit the NPD process. During NPD, design changes from inside or outside of the project team will have great influences on the project performance. The negative influences of those changes on performance could be reduced through proper project management actions. This thesis performs a case study analyzing operating data and the influencing factors in different NPD projects to provide reference for future NPD project practices. The main outcomes of the study include the need for the combined considerations on the source and content of design change, the project type, and the stage of project while researching the relationship between design change and project performance. In addition, properly implementing project management actions including communication and coordination, knowledge and problem solving, and organization management abilities could reduce the negative influences of the design change on project performance during NPD.

Performing New Product Development (NPD) projects requires collaboration of lots of engineers, designers and managers. Companies run frequently such projects but not all of them are able to transform ideas into business success. One of these success factors is closely related to the efficiency of project coordination and management. This article deals with specific performance measures, namely, conformity measures, which can be used as a powerful parameter for NPD projects management. We consider an NPD project as a network of services provided by actors to each other. According to this idea, a given conformity measure, defined for every couple of actors, qualifies the quality of the service provided by an actor to another. Conformity measures appraise then the satisfaction degree of an actor who contributes to NPD project workflows regarding his/her collaborators. These service-links among actors allow to define four main parameters: forward, backward, upward and downward conformity measures. Once defined, two of them are illustrated through case studies. The first one concerns bicycle design process. The second one refers to a very simplified linear manufacturing procedure of a French car manufacturer, PEUGEOT™. For both the cases, we propose a visual aggregation method, which qualifies the global quality of the considered process.

Investor Reactions to New Product Development Failures

New product development (NPD) project studies have attempted to identify a common set of factors that will indicate whether a NPD project will succeed or fail. A recent study has shown that there is no universal set of factors; also some factors have contradictory effects on a project’s success. A framework that classifies NPD projects into different contextual groups explains these anomalies. The grouping helps in determining the appropriate weights for the different success/failure factors, and the type of management organization and approach suitable for the project. The many subjective elements make classifying NPD projects into their appropriate contextual grouping difficult. Describes a rule‐based expert system which classifies NPD projects into their appropriate contextual groupings, suggests the level of emphasis for different success/failure factors and the right approach for managing.

Knowledge Management Strategies for Product and Process Design Teams

Summary form only given. For continued success in the market place firms should introduce new successful products into the market, and gradually retire older mature products. The introduction of new products should be timed properly; it should also produce an appropriate product mix so that the strategy of the firm is continued and strengthened. The portfolio of R&D and new product development (NPD) projects should be structured such that the goals of the firm are met. There has been considerable interest in this field. Firms want to optimize the use of their resources invested in R&D and new product development projects. The R&D and NPD portfolio should fit the strategic vision of the firm in terms of-technology, growth and areas of business. Once the projects in the portfolio are plotted in the contextual model it is relatively easy to see where the holes in the portfolio are, and where the over representation of projects is. With such an understanding one can develop an optimum portfolio of NPD projects consistent with the strategy of the firm, and determine the appropriate number and type of projects one should have in each of the cells of the contextual cube. The type of mix of projects in the portfolio for a specific strategy has to be determined based on the strengths and weaknesses of the firm, as well as the managerial style of the organization. A very general set of guidelines is proposed in the paper. These guidelines take into account the nature of the projects, the type of effort involved and the strategic fit of the projects with the firm's strategy.

Upper management control of new product development projects and project performance

In an intensively competitive market, developing a new product has become a valuable strategy for companies to establish their market positions and enhance their competitive advantages. Therefore, it is essential to effectively manage the process of new product development (NPD). However, since various problems may arise in NPD projects, managers should set up some milestones and subsequently construct evaluative mechanisms to assess their feasibility. This paper employed the approach of Bayesian decision analysis to deal with the two crucial uncertainties for NPD, which are the future market share and the responses of competitors. The proposed decision process can provide a systematic analytical procedure to determine whether an NPD project should be continued or not under the consideration of whether effective usage is being made of the organisational resources. Accordingly, the proposed decision model can assist the managers in effectively addressing the NPD issue under the competitive market.

The role of design and designers in new product development (NPD) has always been problematic and complex in its approach and in the extent of its involvement (Leenders et al., 2007; Murray and O’Driscoll, 1996; Veryzer and Borja de Mozota, 2005). As the industrial design profession seeks to confront the challenges of a recessionary environment, both the designer led ‘intuitive’ approach to NPD, and the marketer led ‘systematic’ approach become outmoded (Cross, 2001; Martin, 2007). There is shortcoming, even ambivalence, in the NPD and design management literature as to how design is involved in NPD (Cooper et al., 2003; Olson et al., 1998). Perks et al. (2005) suggest the designer’s involvement is moving from merely functional expertise to broader leadership activities. The research reported in this paper seeks to contextualise the fledgling position of design as NPD leader, and to understand the nature and level of design and designer involvement in NPD. Using a case study approach, the researchers sought to investigate these issues in Ireland’s largest industrial design consultancy. The firm, established 25 years ago, employs 30 design professionals. It handles projects for a range of well-known, international clients in mature, consumer product categories, for example, Palm, Terraillon and Logitech. The lead researcher spent six weeks embedded in the firm in summer 2009, carrying out quasi-ethnographic observation and semi-structured interviews with designers and management. Further interviews were conducted at the European studio of an international consultancy to enable a broader comparison. The firm was found to be in a period of flux, moving from a situation where the client called the shots, often based on uni-dimensional market research, towards one where the design studio sought to win greater involvement in NPD. A studio in such a predicament has yet to be empirically examined in the literature. Reorientation from a passive, and often late, role in NPD towards one of fuller leadership and greater input is a central feature of this research. A significant amount of conventional design work was gradually gravitating towards business analysis and marketing conceptualisation. Designers engaged in a high level of analysis on product, user and brand, and offered direction to clients through a range of activities. In many regards, they embraced the language and craft of the marketer. The company’s new mantra was to “manifest our clients’ brand through great product design”. This shift marks the division between the designer’s role as a mere service provider versus design authority. The extent to which leadership could be successfully offered depended, in a large part, on the relationship between designer and client. This relationship determined the extent and timing of involvement of designers in NPD. Different types and intensities of relationships were observed. For example, constant dyadic communication facilitated intense relationships where typical design briefs were extremely informal. However, an asymmetry in consultancy-client relationship, provoking vulnerability and internal tension, was uncovered. This revealed the transitional ground that the studio currently inhabits. This study charts in detail a move by a well-established design consultancy to take greater ‘ownership’ of NPD. In shaping this process, the constellation of the designer-client relationship is critical. A model of designer-client involvement in NPD, hinging around project classification and designer input, is developed. This model is predicated on three important insights from the research: (i) a broadened designer remit; (ii) extensive and early NPD involvement on the part of designers; and (iii) increased ownership of the NPD process by the consultancy designers. As the design profession transitions, as designers increasingly sell a greater range of expertise and provide greater value to clients, it is suggested that the model provides relevant insight to both design consultancies and client firms in the NPD process.

In today's network world, advancement in new product development (NPD) is being driven by different types of networks, joint ventures, alliances, outsourcing and mergers. These business trends have resulted in complex organisations and development projects that cross location, company, country and cultural boundaries. The key success is no longer integrating the company's units and activities, but integrating the NPD process across a network of strategic partners. Managing the integration of an NPD process in this increased organisational complexity requires a sophisticated organisation design to facilitate and support the coordination of activities and the flow of information across the network. The research investigates the impact of organisational design of the network lead company (the main company in the network) on the NPD project's integration process elements with external partners and the subsequent effects on performance. The "integration process elements" in this research are: "communication and coordination." I focus on the R&D organisation in the network lead company. Within the R&D organisation, I adopt the project level of analysis and answer the main research question: How can the network lead company design its R&D organisation to support the NPD project's communication and coordination activities with the project strategic partners and improve project performance? The research centres on the integration with strategic partners in whom the network lead company has equity investments (minority holdings). Using data collected from three in-depth case studies of high-tech NPD projects conducted by three network lead companies from different industries, I attempt to extend and merge the knowledge of NPD management and the organisation theory by proposing a contingency model and developing a condition of fit between contextual conditions that characterise the high-tech NPD project and the organisation design of the network lead company. The model suggests that the efficient performance of the development project (shortest, cheapest, and highest quality possible) is contingent on how well the actual intensity levels of communication and coordination fits the required intensity levels. The research also indicates that the required intensity of communication and coordination between the network lead company and the project strategic partners in uncertain and complex project is dominated by the development cycle time (DCT) of the project. Conversely, the actual intensity of communication and coordination between the NPD project team of the network lead company and its project strategic partners is enabled by differentiated combination of R&D organisational attributes: centralisation, formalisation, number of hierarchical levels, team empowerment, and power of the leadership.

Application of risk-based fuzzy decision support systems in new product development: An R-VIKOR approach