Assessing best practices for new product development in organisations
Abstract
New product development (NPD) is increasingly being recognised as a critical
factor in ensuring the continued sustainability of organisations. For companies
to compete in the market place, they have to keep up with market and
technological changes that have accelerated in the last decade. To introduce
new products successfully to the market place, new methods and techniques
are inevitable. Starting with innovation and using NPD best practices, a
product can be delivered to the market successfully. Assessment of best
practices for NPD in organisations can help understand the dimensions of
developing new products and being competitive. Implementation of NPD best
practices within each dimension could vary in accordance with the size of the
organisation due to company policies, management and structure of the
organisation. This study will investigate best practices for NPD in
organisations.
A survey was conducted and the sample was randomly taken from the target
population located in the Vaal Triangle and neighbouring towns. Participants
were business owners or management-level employees involved in the NPD
process of the business. The literature study that was conducted elucidates the
concept of a product, models of NPD and NPD best practice dimensions. In
managing the NPD process, a few important points were raised to understand
the complexity of NPD. An assessment of the empirical investigation was done
to find practical answers to NPD best practices.
The relative importance of NPD best practices compare with previous research
in literature. By comparing NPD best practices of SMEs and large enterprises, it
was found that they do not have similar opinions regarding the relative
importance of the seven dimensions of NPD. Strategy is the most important
dimension, while metrics and performance measurement are the least
important of the total of seven NPD dimensions that had been assessed. The
ranking of company culture with a strong presence suggests that local
organisations understand the need and urgency to embrace innovation. Findings of best and poor NPD practices indicated that practitioners reflect
quite evenly over all the practices, but slightly less over NPD best practices of
the dimensions of commercialization and project climate. A general consensus
among practitioners existed to what constitutes a best and a poor NPD practice
on the seven dimensions. Additional work - that was not part of the objective,
but nevertheless complemented the survey - was done. This included the
assessment of structural relationships of NPD dimensions in organisations, as
well as identification of the differences in NPD best practices between SMEs
and large enterprises.
The contribution of the study is firstly to better understand NPD best practices
by means of the assessment and structural equation modelling that will fill gaps
in literature. Secondly, the study can help managers to improve their
capabilities of NPD in practice.
Recommendations include the need for organisations to invest in opportunities
and an environment that promote innovativeness. This includes skilled
innovative human resources and financial resources to support NPD. Senior
management has to encourage and provide for NPD in the organisation. The
co-ordination of managers at different levels that involves the bigger picture of
departments and achieving the mission and vision of the organisation has a
final influence on NPD sustainability