Category Archives: New Product and Service Development and Process Selection

Advances in Technology

Advances in Technology 

Rapid advances in technology are causing many products to become obsolete more quickly For example microcomputer chip technology has significantly reduced the size of cellular  pones while at the same time expanding their capabilities Cell phones in Finland  flit are now equipped with smart cards which actually allow purchases to b  trans through the  phone the  co t of the purchase being charged to the individual credit  want a drink from a vending machine. you just aim your phone ell it and all   translates the necessary construction information to the machine  and  our Computers are another good example products that paced by advance.far exceed anything imaginable 15 years ago; and this trend will most likely continue into the foreseeable future Technology also has impacted the processes by which goods and services are produced
and  slivered. Computer-aided design  (CAD) and computer’-aided manufacturing (CAM) systems now provide firms with the ability to significantly reduce the time between product development and production  As another example of how technology has affected the production process the increased use of robotics on the factory floor not only reduces labor costs but also significantly increases product quality.

Why the Emphasis on New Goods and Services

Why the Emphasis on New Goods and Services

As the world becomes a single global economy most firms have seen a significant increase
in foreign competition in their respective markets. The reasons for this increase in foreign
competition are many including.

  • Advances in telecommunication technology such a the Internet which now
    provides connections to literally every corner of the world.
  • A trend to lower trade barriers such as import duties and tariffs on foreign good and
    the creation of trade organizations such as NAFTA and the European Union.
  • The faster speed at which good can be transported.

The combination of increased competition and the greater availability of information has also resulted in more educated consumers who now expect new products to be introduced more frequently. In such a highly competitive environment, the markets for these goods and services tend to reach their maturity much sooner than was previously the case. As a res ult. these products become commodities much sooner. and their profit margins therefore tend to erode more quickly.

Managerial Issues

Managerial Issues

A fact of life for most companies and their managers in today's highly competitive environment is that product life cycles are becoming shorter and shorter In order to remain competitive and retain overall market share within their respective industries  managers the reforge need to focus their resources on developing new products and bringing them to market more quickly and efficiently-and doing it on a continuous basis. From golf shoes 0 computers new products often represent the majority of a company's sales. Thus a failure to introduce new products will ultimately erode a firm's market share and its associated profits.

New Product and Service Development, and Process Selection

New Product and Service Development and Process Selection

Chapter Objectives

  • Illustrate the importance of the development of new products and
    services to a firm’s competitiveness.
  • Identify the various types of new products that are developed by
    companies.
  • Introduce the new product design process and the concept of a
    product’s life cycle.
  • Demonstrate the necessity of concurrent product and process
    design as a new product or service is developed.
  • Present a framework for understanding how new services are
    developed and introduced into the marketplace.

GILLETTE’S NEW WOMEN’S RAZOR IS A HIT!

Venus Gillette’s new women’s wet shaving razor was introduced into the marketplace in March 2001 and within six months it had captured more than 45 percent of the women’s wet razor market The new Venus “shaving system 4 features many innovative characteristics that Gillette hopes will redefine women’s shaving Venus’s development took advantage of more than 50 separate Gillette patents including previous research efforts in developing men’s razors notably MACH3 and Sensor In addition, there were new characteristics that were unique to Venus Venus’s design which consists of three progressively aligned blades provides a much closer and smoother shave than does the conventional twin blade razor Other special features of the Venus include (a) soft cushions that help smooth the skin prior to the razor cutting the have(b) indicator strips that show the user when t~e lubricant is used up (c) a long sleek handle that allows for an easier grip and (d) a razor storage system that is designed to hang in the shower or bathtub.

Although Gillette used some of its existing processes to manufacture Venus  it also in vested more than $300 million additional in research and development as well as manufacturing. Another key factor that contributed to Venus’s success was the ability of Gillette to team up with several of its suppliers to design and produce an exceptional package for displaying
the Venus in retail outlets.

Over the years Gillette has consistently demonstrated an ability to bring new products to market. thereby capturing and/or maintaining ‘a significant market share within its industry. It accomplishes this by carefully coordinating and integrating product and process research and development manufacturing and its suppliers. The end result is the continuous successful introduction of new products in a timely and cost efficient manner. Gillette projects that its sales of female shaving products in total will reach $1 billion driven in large part by Venus.