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THE IMPACT OF NEW PRODUCT DEVELOPMENT ON THE PERFORMANCE OF AN ORGANIZATION

ABSTRACT

Product is a very important part of the marketing mix, and consumers want and satisfaction serve as the yardstick for creating it. Hence products must be designed with the market's need in mind. This essay writing intends to look at the basis for planning changes in marketing strategy which allows a management to take a corrective course of action. As a matter of fact, products like human beings have life span and they can die. The danger in the death of an organization product is that it could result to the closure of the organization business operations. In the light of this, it is therefore a necessity for organizations to adopt the new product in order to remain in business and have a sustainable and a new market.

CHAPTER ONE

INTRODUCTION

1.1   BACKGROUND OF THE STUDY

The society expects that all the manufacturing industries should continuously improve their business performance. To do this, all industries strive to operate and compete in an expanding and dynamic environment, and new product development is a vital source of competitive advantage. As posit by Grupta et al (1986), Edgett (1996) and Taylor et al (1994), Vourlioti et al (2008) technological evolution, the highly competitive environment and the varying (diversified) customer needs, have forced enterprises to search for and apply new product development processes that could improve their product unique characteristics, quality and business performance.

According to Vourlioti et al (2008), Balbontun et al (2000), industries adopt its own standards and different approaches to design new product development process (NPD), depending on its size, types and number of products or services that it produces, as well as its business environment. Consequently some industries focus their attention on the improvement of the product’s technical specifications, while other look for new product development processes that could reduce the development time and accelerate the production process and the business performance. Basically, there are two elements needed for an effective new product development – process and people.

According to Techeuchi and Nonaka (1989), Wheelwright and Clark (1992), Prasad (1996) and Vourlioti et al (2008) in the last few decades the rule of the new product development “game” have dramatically changed. Industries have realized that high quality, low cost and differentiation strategies are not enough to lead them to business success (Kaplan and Norton, 2001). Pooltan and Barcley (1998). They posited that innovation should be focused on customers, while its success depends on how much innovation conceptualizes consumers needs and requirement.

According to Calantone et al (2000s), Gevirtz (1994), there is no one right strategy for a company, rather for new product development, the different stages are allowed to overlap, and to accelerate the product development process right from the idea generation to commercialization. The product development process should focus on the following strategies, time to market, low product cost, low development cost, innovation and technology, quality

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