NPD Processes – What typically goes wrong and how do we help?

Over the past 20 years, we have worked within a variety of industries that rely on efficient and effective New Product Development (NPD) processes. Often, we witness some common themes that cause issues, irrespective of the company involved.

1)      Who is involved and when?

If a product is to be delivered on time, to the customer’s satisfaction and at the required cost, it is crucial to consider who should be involved in the process and at what point in the journey. To some extent, this will be determined by the type of business and industry but should nonetheless be given prime importance.

This could be the classic situation of sales saying YES to anything and everything without passing information on, or a lack of process and project owner. Considering implications down the line; ensuring data capture and transfer is the first step to overcoming this issue. Conducting an end-to-end analysis of the process can provide a spotlight on who should be involved or who isn’t involved. Often this reveals a disjointed approach. Alternatively, it could be that nobody is in overall charge of the NPD process and important aspects are dropping through the cracks. Having a project or process owner to manage progress through the gates and ensure all stakeholders are fully informed can eliminate this issue.

2)      Stage gates – do they exist and if they do, are they left open?

We recently worked with a food manufacturer that had a long-established stage-gate system. However, our analysis phase revealed that it often failed due to the lack of alignment to customers’ gates. In this case, the gates were left wide open and there were no checks at each stage gate before moving to the next stage.

Another client had no stage-gate process at all – only the NPD department knew what was going on, therefore everyone else was left in the dark. Inevitably the process was falling down in multiple places, as crucial departments such as supply chain and production were unaware of the implications until it was too late to react.

In both of these examples, we saw departments regularly under increased pressure due to firefighting whilst seeing cost targets slip further, issues with production and customers unaware.

Any successful process begins with a cross-functional working team. You embark on the journey if it strategically fits the business objectives and considers your priorities, ensuring that all business functions have a voice and are aligned to the same conversation.

The solution was to build and install a robust go/no-go gate system by involving a cross-functional team, ensuring internal cross-checks at each stage and ensuring the customer was kept updated with progress.

3)      Communication, communication, communication

Communication is key to any process and an NPD process is no different. Whilst it sounds like the simplest thing, we often find it lacking.

Internal communication should be seamless, with all stakeholders kept updated via regular intervals i.e meetings or a short email. Everyone should be aware of the timeline of the project and where their involvement lies.

External communication is equally important and should be triggered by robust gates at each stage of the process. External communication MUST include the sharing of bad news where required, not just good!

What are the benefits of getting your NPD process right?

As a consultancy business, our customers are typically looking for tangible benefits to justify our engagement in their business, such as increased profitability or revenue. However, you can also unlock softer benefits related to employee and customer satisfaction, by simply getting people to know what they should be doing and collectively working together.

For example, one of our clients had recently untaken a restructure which resulted in unhappy staff and increased employee turnover. By involving staff in the development to improve their processes, the client observed a clear step-change in staff morale, a decrease in staff leaving and an overall reduction in operational costs.

Typical benefits include:-

  • Time to market
  • Customer satisfaction
  • Market share
  • Employee satisfaction
  • Improved quality
  • Cost reduction ( development spend, raw material spend, labour hours)
  • Rework reduction
  • Operational improvements

We would typically expect to deliver a mix of tangible and soft benefits to more than justify the project cost itself.

After all, who doesn’t want increased profitability with happy staff and customers on top?

To find out more, or discuss how we might help your business, please contact Mitesh Bamania mitesh.bamania@libraeurope.com)

 

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