MARKETING

Marketing

Marketing

Paper 1

Challenges in New Product Development

As part of developing a new product launch strategy is one of the most important phases. It is the one that guides the life of the product. That is why marketers put into action all the marketing tools available to them (Market research, product analysis, product research). It is usual to think that this strategy is limited to communication and distribution, but we think that all upstream work such as market analysis or research avenues for development work is crucial for a good start. Within a company, the marketing department will have the first task of assessing the chances of successful development and launch of a new product in a market again. Through the understanding of market, competition and analysis of various opportunities. This will bring the company to explore new avenues of development for its product (Klinefelter, 2010).

However, product development is in many industries where product components are modular increasingly developed in different development centers around the world and then integrated and tested centrally, has become a global endeavor.

As far as the challenges in developing new products in the global economy are concerned, there are a number of challenges, but few of them are discussed below:

Intellectual Property (IP): Sharing valuable product data, designs, and technologies outside the company makes protecting IP more challenging. Companies must define products and processes in a modular structure to help protect IP (Cleveland, 2006).

Example: KFC has its own formula for making fried chicken, which is universal around the globe. When KFC was launched it got registered its patent rights globally. This formula or patent is the intellectual property of KFC which it has protected right from its initial launch, with the help of modular structure in its products and processes.

Process Methodology: Companies must develop a methodology to delegate tasks to different global centers. When a remote location is involved in work that is part of a larger task, there must be a process in place that breaks down the task into clear steps, determines what steps are done by each center, then reconfigures the process to enable the necessary handoffs, reviews and approvals.

Example: For process methodology, McDonald's is a perfect example. When McDonald's was launched, it started this practice globally. The processes are defined by headquarter that is located in USA to the entire global franchises. These franchises are supposed to follow the instructions and guidelines of the process methodology that is defined by the global headquarter. For instance, the way to entertain the customers is same in every McDonald's franchise all around the globe. Moreover, the environment inside every McDonald's is same around the globe.

Product Modularity: Often complete subsystems or components are outsourced to design teams at another location. Modular product architectures can facilitate the global coordination of these products. Clearly defined interfaces between modules facilitate their separate development and eventual integration into the final product (Klinefelter, 2010).

Example: Toyota has outsourced engines for some of its new car brands. It is importing these engines from United States and this is done by Toyota ...