New Product Management Best Practices – What the top New Product businesses do to succeed!

The foundations of best practices began 30 years ago with the focus on understanding the causes of new product failure and what separates the winners from the losers. In mid ‘80s an early version of Cooper’s Stage-Gate^® process was introduced and versions of it were adopted by numerous businesses. Continued research into the practice of introducing new products led to the most recent published “Innovation Diamond” and the four points of performance which are the Best Practices of the top performing businesses as measured by their success introducing new products.*

These are:

• An idea-to-launch framework for doing NPD projects right
• A clearly defined product innovation and technology strategy
• Resource commitment and focusing on the right projects
• The right climate and environment for innovation..

*Best practices are based on Robert G. Cooper’s latest book Product Leadership: Pathways to Profitable Innovation, 2nd edition, Basic Books, 2005.

Figure 1. Four points of
performance of the Innovation Diamond*

The first and most important best practice is a formal idea-to-launch framework that funnels a large number of new product ideas into a few new products with a high likelihood of success. A Stage-Gate^® process, one that at the earliest stages culls out potentially poor prospects and adds resources to potentially great prospects, sets out clear Go/Kill decision points and is an enabling process for the project team is the most popular example. At each point the gate is a screening decision point where, if the project passes, the Go project is funded and deliverables are specified for the next activity, the stage. The Stage-Gate^® process was first adapted in the late ‘80s and has been modified to fit services and other specific types of products. One of the major contributions of this idea-to-launch process is the focus on market information required for the all Go/Kill decisions. See New Product Process and Role of Marketing Research for more details.

The second and third best practices were first articulated in the mid ‘90s as a result of a series of benchmarking studies. With the foundation of a sound idea-to-launch framework it was found that a clearly defined product innovation and technology strategy and a resource backed new product portfolio were the three characteristics possessed by the top performers. It is clear that a successful new product portfolio requires a clear product innovation strategy. For additional best practices see Product Innovation Strategy and New Product Portfolio.

As the New Product practices mature, foundations are solidified and new best practices emerge. The latest benchmarking studies separated the fourth point of performance – the right climate and environment for innovation. For addition information see New Product Environment.