The New Service Development (NSD) Process
The new service development (1 SO) process i very similar to the NPD produce with one major difference. When developing a service you are inherently deigning both the product and the process at the same time because the product is typically inherent in the process Since services are intangible: rather than something you can drop on your foot it is nearly impossible to separate the product from the process. The NSD process typically begins in the same fashion as the NSD process. An idea will come forth either from marketing customer market pull or voice of the customer or from operations (service operations push In services there currently is not the same type and level of R&D as there is for products. The R&D in services occurs primarily in the operations process with respect to how the service is delivered.
The SD process also consists of four stages that are similar to the stages of the PD process The first step design consists of the formulation of the objectives and strategy of the new service followed by concept development and testing of the concept Concurrently the analysis phase considers the financial implications of the new service and examines the supply chain issues relevant to its delivery Upon successful completion of these two phases the new service project is approved for continuation. The third and most resource intensive phase of NSD is the development phase In this phase the service design is completed and tested all the processes that ensure service delivery are fully deigned and tested personnel are trained and a pilot run of the service is conducted Once the new service passes the pilot test unflinching the fourth stage in the NSD process begins when the service is released to the marketplace The study of the NSD process is significantly less mature than that of the PD process While much work has been done in the development of new service design particularly with respect to the degree of customer contact which is presented shortly overall there has been limited research on the total NSD process To address this need Johnson have developed a series of propositions that provide some direction for the future of NSD research These propositions include .
- The NSD process is more likely to be nonlinear for new services that are less standardized or are delivered through more industrialized service channels.
- Competence in the planning phase activities of the SO process drives success fulradical innovations, whereas competence .
- Service failures and subsequent recovery efforts are often the result of using an ad hoc NSO process or the lack of SO competence, rather than from execution.
- Effective portfolio management of individual NSD efforts will decrease the total risk of a firm's SD program and increase the probability of high NSD returns (similar to the portfolio management approvals that mutual funds use.
- Portfolio-like management of NSD efforts will increase the fulfillment of heterogeneous customer needs.