Revitalize your business through product adaptation: Stage 1 – Innovation

14/04/2020

Kid with jetpack and skateboard

Kid with jetpack and skateboard

When businesses face hardship, either due to market forces, missteps, or force majeure, there are two ways to proceed. Stanch the bleeding and focus on existing products and markets being served – or buckle down and find a way to reinvent your brand, offerings, and consumer base. For those eyeing option number two, adapting products to reach new areas of demand requires research, ingenuity, and resilience.

Here’s where to start.

This content is an excerpt from the FITTskills Product Development online workshop. Start the workshop today to learn in 30 days or less how to turn your ideas into hit products!

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The Stages of Product Development and Product Adaptation

When entering a new international market, organizations may develop a new product or adapt an existing product to guarantee regulatory compliance and ensure their products remain relevant to their consumers.

To determine whether to pursue either of these options, organizations need to assess the market based on research findings and identify and analyze opportunities. Should they decide to proceed with developing or adapting a product, the general process begins with generating and scoping ideas and determining whether they represent feasible and profitable opportunities. Once a business case has been made, organizations begin the formal development process, designing the operations or production process required for full scale production, testing the product and finally launching into the new market.

The four general stages referred to in different product development models are:

  1. Innovation
  2. Design
  3. Testing
  4. Launch or commercialization

In this 4-part article series we will cover each aspect of product adaptation, starting with Stage 1:

The Innovation Stage

An approach to managing the product development or adaptation process has been put forward by Peter Koen from the Stevens Institute of Technology.

Koen begins with the front end innovation stage (also referred to as the fuzzy front end or FFE). This is the period in which an opportunity has been identified, but before formal product development begins.

The stage includes tasks such as strategic planning, concept generation and pre-technical evaluations.

These activities tend to flow in an unpredictable, unstructured and often chaotic manner. Despite this, it can be a valuable stage, as the analysis and testing often lead to a successful product development activity.

During the front end innovation stage, market research is used to understand the influencing factors; this can be the catalyst for idea generation and idea screening. Once a product concept is generated, a decision is made on whether this concept is feasible and merits further investment of resources.

Koen outlines five different elements that pertain to front end innovation:

  1. Identification of design criteria: Criteria and guidelines are discussed and decided.
  2. Idea analysis: Identified ideas are explored in the context of the business and related implications for the company. Some market testing might be conducted to understand how/if the concept will translate into a solution for the end user.
  3. Concept genesis: An idea becomes a concept, through an incremental and iterative process, which is either formulated internally or externally (e.g. through a specific customer request or the availability of a unique material from a supplier).
  4. Prototype: If there is a strong business case for the development of the concept, there is generally a decision to pursue the creation of a prototype of the product.
  5. Product development: A formal business case is developed based on factors such as available market share, customer requirements, required resources and competitor analysis. This is often treated as the first step of the formal product development process.

Although there may be iterative and less formal processes during this front end or pre-development stage, it is still critical to establish quality early on. Filter out flawed product strategies in the early stages of product development to avoid costly consequences at a later stage. Quality should be measured both quantitatively and qualitatively.

Ensuring quality in front end innovation

Focus of innovation stage: Idea screening

Qualitative measures Quantitative measures
·        Track and document ideas submitted throughout the process.

·        Develop metrics to score and determine the level of quality of each idea.

·        Assess how the features and benefits resonate with and meet customer needs.

·        Score and rank the product viability and customer tendency to buy.

·        Conduct peer review cycles with stakeholders on an ongoing basis.

·        Assess existing resources, skills and ability to deliver a new product and identify gaps.

·        Assess product alignment with existing products.

·        This stage is the most creative and does not easily allow for quantitative analysis. Some possible metrics include the number of ideas generated, the number of ideas that resulted in launched products and historical success.

·        Estimate hours needed for product development.

·        Estimate financial resources needed for product development.

·        Analyze customer feedback.

·        Calculate technical feasibility requirements.

Focus of innovation stage: Business case

Qualitative measures Quantitative measures
·        Assess how the new product aligns with overall strategy and sales and marketing goals.

·        Conduct a risk analysis with mitigation plans to determine best ways to reduce risk.

·        Determine financial implications on existing product portfolio.

·        Determine cash flow (e.g. Net Present Value, Risk Adjusted Net Present Value).

·        Calculate the Return on Investment (ROI).

·        Estimate the length of time to get product to market.

·        Determine profitability % increase (compared to prior product sales).

Best Practices for Front End Innovation

  • Senior management is committed and involved in early stages.
  • Business executive champion is identified and involved in early stages.
  • Work culture is collaborative and encourages knowledge creation.
  • Communities of Practice are established to share, acquire and develop new knowledge.

Stay tuned for parts 2-4 of the product adaptation article series:

2. Design
3. Testing
4. Launch or commercialization

About the author

Pamela Hyatt

Author: Pamela Hyatt

I am the Content Marketing Specialist for the Forum for International Trade Training (FITT). You can find some of my work on TradeReady.ca. My background is in copywriting, journalism and social media. My passion lies in connecting people to the stories that are most important to them.

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