Customers Lead the Way in New Product Creation

Main Category: Pharma Industry / Biotech Industry
Article Date: 06 Jun 2005 - 0:00 PDT

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Customers are the most frequently mentioned source of new product ideas, according to a survey conducted by research and consulting firm Best Practices, LLC.

"Organizing for International Product Development and Deployment," which includes a free summary that can be found at best-in-class.com/br65.htm , focuses on how to best structure product development in a company with global operations, with input from executives at 65 companies.

Creating a formal cross-functional collaborative council or committee was cited as the primary means of structuring product development at these large companies. Respondents cited an average of five separate steps included in the product/service development process, beginning with business planning and followed by design, market research, creation and testing. When such activities were not under the umbrella of product development, they most typically fell to marketing.

Marketing also was the group most sought after for input by the product development group, followed by R&D; customers; and sales and manufacturing. When asked about budgeting responsibility, about half of the respondents reported a centralized product development budget located at headquarters. Another third of respondents chose "collaborative" -- an accountability style whereby headquarters sets and/or approves the budget with business unit input. Then, the business units execute against known targets.

This research also focused on:
- Product Development Trends
- Methods of Measuring Success
- Launch Pitfalls
- Lessons learned

"There has been a whirlwind of restructuring across product development at these large companies," said Jon Easter, director of Best Practices, LLC's Business Excellence Board. "Some fallout from all of this activity is more formalized processes, increased outsourcing, greater global development and a greater use and reliance on a customer feedback loop."

This study reflects the type of research members of the Business Excellence Board (BEB) commission from Best Practices to support their sales and marketing organizations. For more information about this research, visit best-in-class.com/br65.htm.

The Business Excellence Board (BEB), accessible at best-in-class.com/beb , is a premium membership service providing ongoing decision support to corporate executives through on-demand benchmark research, database access and best practice information exchange. For information, contact Cameron Tew at ctew@best-in-class.com or 919-403-0251, ext. 246.

ABOUT BEST PRACTICES, LLC

Best Practices, LLC is a research and consulting firm that conducts work by studying the best business practices, operating tactics and winning strategies of world-class organizations.

Best Practices, LLC
http://www.best-in-class.com

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