Part lI Key requirements for successful product development Product development is the key to the future in the business strategy. In the business strategy, the top company management signifies the changes necessary for the company's future survival and growth and from this can be identified the basis for product development. The future is what product development can provide, delivering new products by the least risky, most efficient process to carry the enterprise forward. It must harmonise with the existing company activities as it delivers the new. Therefore it has to be an integral part of the business strategy with full support of top management and cooperation from management in all areas of the company. Product development builds systematically from the resources and within the constraints of the business, progressing through four key stages towards a satisfied market. The product development process is the system that integrates the activities in the four stages and its efficient and effective organisation is one of the major factors ensuring success in product development. All of product development is underpinned by knowledge of the product market, production, distribution, consumer and society. The more extensive, complete and accurate the knowledge, the greater the probability of a good fit of the new product to the business and the market. So the fullest, practicable, exploration of existing knowledge is important early in the product development process. This knowledge is extended by information from outside the company, and by creation of new knowledge inside the company The consumers are an integral part of all product development projects, even in industrial marketing where the immediate customer is the food manufacturer or food service outlet. The product is built around what the consumers need and want, and their behaviour in buying, using and eating the product
Product development is the key to the future in the business strategy. In the business strategy, the top company management signifies the changes necessary for the company’s future survival and growth and from this can be identified the basis for product development. The future is what product development can provide, delivering new products by the least risky, most efficient process to carry the enterprise forward. It must harmonise with the existing company activities as it delivers the new. Therefore it has to be an integral part of the business strategy with full support of top management and cooperation from management in all areas of the company. Product development builds systematically from the resources and within the constraints of the business, progressing through four key stages towards a satisfied market. The product development process is the system that integrates the activities in the four stages and its efficient and effective organisation is one of the major factors ensuring success in product development. All of product development is underpinned by knowledge – of the product, market, production, distribution, consumer and society. The more extensive, complete and accurate the knowledge, the greater the probability of a good fit of the new product to the business and the market. So the fullest, practicable, exploration of existing knowledge is important early in the product development process. This knowledge is extended by information from outside the company, and by creation of new knowledge inside the company. The consumers are an integral part of all product development projects, even in industrial marketing where the immediate customer is the food manufacturer or food service outlet. The product is built around what the consumers need and want, and their behaviour in buying, using and eating the product. Part II Key requirements for successful product development
44 Food product development The four important facets of understanding product development are the place of product development in the business strategy, the product development process, the knowledge in product development, and the consumer/product elationship. Thus the new product can be developed to fit most comfortably to the business that produces it and to the customer who consumes it
The four important facets of understanding product development are the place of product development in the business strategy, the product development process, the knowledge in product development, and the consumer/product relationship. Thus the new product can be developed to fit most comfortably to the business that produces it and to the customer who consumes it. 44 Food product development
Developing an innovation strategy Product development does not occur in isolation as a separate functional activity. It is a company philosophy, a basic company strategy and a multifunctional company activity. In recent years to show this all-encompassing basis, bringing together product, process, marketing and organisational innovations, there has been development of an overall innovation strategy This innovation strategy is related to the companys overall business aims and strategy, as well as the social, economic and technological environment, and the companys own knowledge and skills. The business strategy also includes a product strategy outlining the products of the future. The combination of the innovation and product strategies is the basis for the product development strategy, and from this can be developed, with the companys technology strategy, the product development programme as shown in Fig. 2. 1. In building business and innovation strategies, it is important to recognise that from them comes a product development programme both for many years ahead and for the immediate year The innovation strategy is built up in the business strategy from the innovation possibilities, but only after thorough coordination with the product, marketing and technology strategies. The product development strategy is then built from the innovation strategy, together with other parts of the business strategy such as product mix planning and marketing strategy. Finally from the new product portfolio and the prootay the product development programme sits uct development strategy is built the product dev evelopment programme. In this harmoniously with the strategic direction of the company, the companys technical and marketing capabilities, and the customers in its ultimate market
Product development does not occur in isolation as a separate functional activity. It is a company philosophy, a basic company strategy and a multifunctional company activity. In recent years to show this all-encompassing basis, bringing together product, process, marketing and organisational innovations, there has been development of an overall innovation strategy. This innovation strategy is related to the company’s overall business aims and strategy, as well as the social, economic and technological environment, and the company’s own knowledge and skills. The business strategy also includes a product strategy outlining the products of the future. The combination of the innovation and product strategies is the basis for the product development strategy, and from this can be developed, with the company’s technology strategy, the product development programme as shown in Fig. 2.1. In building business and innovation strategies, it is important to recognise that from them comes a product development programme both for many years ahead and for the immediate year. The innovation strategy is built up in the business strategy from the innovation possibilities, but only after thorough coordination with the product, marketing and technology strategies. The product development strategy is then built from the innovation strategy, together with other parts of the business strategy such as product mix planning and marketing strategy. Finally from the new product portfolio and the product development strategy is built the product development programme. In this way the product development programme sits harmoniously with the strategic direction of the company, the company’s technical and marketing capabilities, and the customers in its ultimate market. 2 Developing an innovation strategy
46 Food product development nnovation strategy strategy strategy Product levelopment strategy Fig 2.1 Product development strategy generate 2.1 Possibilities for innovati Innovation is an integral part of society, and therefore an integral part of an industry and a company. There are three basic principles of innovation An innovation is an idea perceived as new by the individual (rogers, 1962) 2. An innovation causes change, which can be technological or sociological but is probably a combination of both(Earle, 1997) 3. An innovation involves a wide range of people, in the company, the companys environment and the society(Earle, 1997) Innovation is seen as the state of mind in the company(Kuczmarski, 1996). The traditional definition of innovation in companies as product development and process development has expanded to include all the other changes that can occur (Voss, 1994). Innovation can include ideas for different changes- philosophy technology, methods, organisation, market, people. But it is important for the company to recognise that any of these changes will affect not only the company but also the other organisations in the food system, the consumers and the society. Innovations outside the company also cause changes inside the company for example, the technological innovation of the supermarket changed food manufacturing and marketing. the social change of more women working caused an increase in convenience foods. So innovation is related to the climate within
2.1 Possibilities for innovation Innovation is an integral part of society, and therefore an integral part of an industry and a company. There are three basic principles of innovation: 1. An innovation is an idea perceived as new by the individual (Rogers, 1962). 2. An innovation causes change, which can be technological or sociological but is probably a combination of both (Earle, 1997). 3. An innovation involves a wide range of people, in the company, the company’s environment and the society (Earle, 1997). Innovation is seen as the state of mind in the company (Kuczmarski, 1996). The traditional definition of innovation in companies as product development and process development has expanded to include all the other changes that can occur (Voss, 1994). Innovation can include ideas for different changes – philosophy, technology, methods, organisation, market, people. But it is important for the company to recognise that any of these changes will affect not only the company but also the other organisations in the food system, the consumers and the society. Innovations outside the company also cause changes inside the company; for example, the technological innovation of the supermarket changed food manufacturing and marketing, the social change of more women working caused an increase in convenience foods. So innovation is related to the climate within Fig. 2.1 Product development strategy generator. 46 Food product development
Developing an innovation strategy 47 Finance Creation Food system Fig 2.2 Climate for innovation. the company and also that surrounding it in the food system and the society as shown in Fig. 2.2. It is important to observe the changes already occurring outside and inside the company, and to predict the possible changes that can achieve the aims of the company to survive and grow. One of the great difficulties is to differentiate between the true. long-term changes and 'fashions which die quickly. Judging wrongly may adversely affect the company The rate of innovation in a company depends on its ability to sense possibilities and to perceive and assess the likely outcomes of to evaluate and rank such outcomes strategically and operationally,in relation to company objectives to make decisions on the basis of such information and prepare appropriate strategies to implement plans and changes in managerial and technical terms(frater et These steps are shown in Fig. 2.3 Sensing the Selecting Include in possibilities innovation the feasible business for innovation innovations strategy Fig 2.3 Innovation chain
the company and also that surrounding it in the food system and the society as shown in Fig. 2.2. It is important to observe the changes already occurring outside and inside the company, and to predict the possible changes that can achieve the aims of the company to survive and grow. One of the great difficulties is to differentiate between the true, long-term changes and ‘fashions’ which die quickly. Judging wrongly may adversely affect the company. The rate of innovation in a company depends on its ability: • to sense possibilities and to perceive and assess the likely outcomes of feasible changes; • to evaluate and rank such outcomes strategically and operationally, in relation to company objectives; • to make decisions on the basis of such information and prepare appropriate strategies; • to implement plans and changes in managerial and technical terms (Frater et al., 1995). These steps are shown in Fig. 2.3. Fig. 2.2 Climate for innovation. Fig. 2.3 Innovation chain. Developing an innovation strategy 47