The first phase of the new product development process is creating a viable product concept that can move through the development phase. This phase includes the following:
- Stage 1: Generating New Product Ideas
- Stage 2: Screening Product Ideas
- Stage 3: Concept Development and Testing
This early phase of the process differs from later phases in several ways. First, it requires immense creativity. Each of the later phases focuses on screening out ideas, but this is a generative stage whose goal is the production of new ideas. Second, the early phase of the process is difficult to plan and manage. On what day will the innovative product idea emerge? That can’t be planned or scheduled.
The Fuzzy Front End
Researcher Peter Koen refers to this first phase as the Fuzzy Front End (FFE) of the product development process. In his work, he has identified a number of characteristics that differentiate the FFE from later phases of product development. These are shown in the table below.
Difference Between the Fuzzy Front End and the New-Product Development Process
|Fuzzy Front End (FFE)||New-Product Development (NPD)|
|Nature of Work||Experimental, often chaotic. “Eureka” moments.||Can schedule work—but not invention. Disciplined and goal-oriented with a project plan.|
|Commercialization Date||Unpredictable or uncertain.||High degree of certainty.|
|Funding||Variable—in the beginning phases many projects may be “bootlegged,” while others will need funding to proceed.||Budgeted.|
|Revenue Expectations||Often uncertain, with a great deal of speculation.||Predictable, with increasing certainty, analysis, and documentation as the product release date gets closer.|
|Activity||Individuals and team conducting research to minimize risk and optimize potential.||Multifunction product and/or process development team.|
|Measures of Progress||Strengthened concepts.||Milestone achievement.|
As the product concept moves through the stages of the product development process, everything will become more refined and more certain. The timeline, the budget, and the performance expectations will all become more concrete, but in the early phase, it is important to allow for the ambiguity that supports creativity.
Creating Successful Product Concepts
How can businesses influence the success of the new business idea? Koen suggests a number of factors that play a role: the corporation’s organizational capabilities, customer and competitor influences, the outside world’s influences, and the depth and strength of enabling sciences and technology.
You may have noticed that some companies are able to launch one dominant product after another. Other companies struggle to create any products that compete well or have one amazing product and then disappear. Companies develop processes to manage new products, hire leaders to manage new-product development, and develop a culture based on their institutional values and norms around new products. All of these factors tip the scale toward success or failure. If leaders ask employees to take risks with cutting-edge product ideas but fire those whose ideas are not successful, they will not draw out risky ideas that might lead to the greatest success. Also, the best ideas are often refinements of and enhancements to other ideas. If individual performance is rewarded over team success, there is less likelihood of idea sharing and collaboration.
Customer and Competitor Influences
Innovation by a competitor can spur new ideas and possibilities across the industry. Similarly, customers seeking innovation who are willing to share ideas with their vendors can accelerate the generation of new product ideas and bring a voice of reality that increases the chance of success.
Outside World Influences
There are a range of influences outside of the company that affects the ease with which new ideas can be developed. Government regulations can positively or negatively influence new-product and idea generation. Society, culture, and the economic environment can create a rich environment for new ideas.
Enabling Sciences and Technologies
Enabling technologies refer to those technologies that can be used to develop new products. When employees have access to technologies that expose them to new ideas, or technologies that allow rapid development and iteration of new ideas, this can be instrumental in sparking the development of new products. Often companies invest in technology components that can be reused across multiple products. Such technology has the effect of both speeding the new-product development process and facilitating the addition of refinements and enhancements to existing products.
Evaluating Product Concepts
The goal of the initial product development process is to generate ideas, actively evaluate the ideas, and create a viable product concept. In the past, it was difficult to get a clear reading on how products might perform until late in the product development process. That is less true today. Consider the following examples of innovations that accelerate market feedback on new products:
Kickstarter is a crowd-funding platform that allows entrepreneurs to pitch a new product concept to potential funders. The entrepreneur receives immediate feedback on the idea from a broad market and, if it generates enough support, funding to bring the product to market.
Etsy offers an e-commerce platform from which entrepreneurs can sell products on the Internet without having to develop their own e-commerce websites to present products or process payments.
3-D printers create physical products from digital files. These products can be tested and refined with users much more quickly and economically than traditionally manufactured prototypes and products.
On a larger scale, there are a number of Web application frameworks that allow programmers to quickly develop Internet applications, significantly speeding the pace at which software companies can prototype and develop new features.
Once a product concept has been successfully evaluated, it moves to the next phase of development.