CRITICAL DEVELOPMENT ACTIVITIES FOR REALLY NEW VERSUS INCREMENTAL PRODUCTS

Does the development of really new products require a different approa ch front that of incremental new products' Current research and manage ment practice seem to suggest that an), successful new product develop ment (NPD) process comprises a set of key activities, regardless of a product's innovativeness. It seems almost foolhardy to suggest that NP D could proceed without proficiency in all of the following tasks: str ategic planning, idea development and screening, business and market o pportunity analysis, technical development, product testing, and produ ct commercialization. Suggesting that the difference may be in the det ails, X. Michael Song and Mitzi Monroya-Weiss present the results of a study that examines the development of 163 really new products and 16 9 incremental new products. The study's objective is to compare the NP D processes and performance outcomes of really new and incremental pro ducts. In other words, the study examines the interplay, between a pro duct's innovativeness, the NPD process, and the product's performance in the marketplace. For the firms in rite study, four sets of NPD acti vities-strategic planning, market analysis, technical development, and product commercialization-are key determinants of new product success for both really new products and incremental products. However strate gic planning and business and market opportunity analysis activities p lay contrasting roles for the two types of products. Working to improv e proficiency in business and market opportunity analysis may be count erproductive for really new products, but if cart increase the profita bility of incremental products. Conversely, improving the proficiency, of strategic planning activities has a positive effect on the profita bility of the really new products, but it has a negative effect for th e incremental products. Overall, the really newt products in the study surpass the incremental products in meeting profit objectives. Compar ing current practice to best practice, the firms in the study, have ro om for improvement. For both really new and incremental products, the firms in the study do not place sufficient emphasis on product commerc ialization activities. The participants also need to reassess the rela tive emphasis they place on strategic planning activities. The project s involving really new products do not place sufficient emphasis on st rategic planning, while the incremental projects exhibit a relatively high level of proficiency in this area-exactly the opposite of the ord er that this study recommends.