New Product Development – Where are you coming from, and where are you going?

Stu Perlmeter

Many companies are in expansion mode – with new product development, or new market additions. Whether driven by the post-Covid “pivot” or just opportunity seeking, market expansion is what companies should be doing, to avoid stagnation or decline.

Some companies have a new product discipline in place; many do not. For the majority, this type of innovation is spurious; leadership is challenged with figuring out the process, as well as making the often-difficult decision to move forward with a plan that by definition involves investment and risk.

A typical scenario is that someone within the organization emerges as a champion for a product enhancement or innovation that bubbles-up to an initiative with momentum. Often a team is assembled to further explore and move the idea forward. What might result is the execution of a full-blown go-to-market plan, based on the idea, without the rigor that stakeholders would expect.

No CEO wants to miss a bonafide growth opportunity and certainly does not want to pour cold water on team members who take personal and professional risks to advocate for a new idea; one that frankly benefits the company more than their own personal or career interests.

Is this the way organic growth should happen, or is there a way of looking at it through a more strategic lens?

A strategic view might pose the question, where are you coming from and where are you going?

What does your strategic plan tell you about growth strategy, and how does this new initiative fit? This might sound like the old homily about a “ship without a rudder”, but at some point, decisions about a net-new product, rather than a feature-set enhancement, ought to undergo this type of strategic filtering process.

To put it into simpler terms, is your approach opportunity centric, or driven by intended business   outcomes? If it’s the former, you just want to know if your innovation is viable; will the dog hunt, the pig fly, etc. The later requires more discipline, in that several more vexing questions come into play.

For example, how does the expansion plan compare with other deployments of capital, energy, and brand expansion? How does the adoption curve and revenue cycle compare to other worthy alternatives that haven’t been explored and compared side-by-side with the idea being advanced?

For many reasons, it is a good idea to engage a third-party firm who can instill greater discipline into the process. Creating confidence among leadership, owners, as well as cushioning champions whose ideas may ultimately not be deployed are all good reasons to hire experts to compare worthy alternatives and run a process that will be respected by all parties involved.

Since 1996, 1st Resource has supported growing companies by validating market assumptions to support critical growth decisions.

About the Author

Stu Perlmeter

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Stu brings 30 years of marketing and research experience to 1st Resource, which he founded in 1996. Stu’s primary expertise is in understanding the market insights that tie to success formulas for companies seeking to grow their business in strategic ways.