Product Development Strategy

What is a Product Development Strategy?

A product development strategy outlines your company’s steps to develop new or modify existing products.

A product development strategy defines the approach and resources required to develop new or modify your company’s existing products.

A product development strategy covers:

• Resource Requirements: Details on resources, such as R&D personnel and finances required to develop or modify your products
• Processes and Timelines: Details of manufacturing and production processes and timelines to develop a product
• Market Dynamics: Analysis of market size, customer needs and any similar products already in existence and their market share
• External Agreements: Details of any third-party arrangements such as technology sharing or joint venture for product development

Why is a Product Development Strategy important for business today?

A product development strategy enables your company to:

• Define the short and long-term goals for developing and modifying your products
• Prioritize product pipeline based on your company’s goals and objectives
• Develop a baseline estimate for financial and labor resources required to develop a product
• Assess the market potential and business opportunities for your product lines

Why is a Product Development Strategy important for an event tomorrow?

A product development strategy is important for an event tomorrow, as it helps:

• Benchmark against historical product development strategies and timelines to assess the reasons for any volatility
• Analyze the financial and operational risks involved in your company’s product strategy
• Evaluate the costs incurred by your company in developing and modifying your products
• Determine your company’s manufacturing and technical capabilities and your reliance on third party expertise
• Assess the competitive advantage of your company’s product portfolio against your competitors
• Measure the effectiveness of product-specific strategies adopted by your company against market performance

Pros of addressing Product Development Strategy

• Formulate product development goals and review progress across different stages of development
• Plan for resources in areas of expertise required in creating a new product
• Understand and measure in advance the market share, demand for and growth of new, planned products
• Optimise resource allocation based on new product launches or market timelines to modify and re-launch existing products
• Respond to customer demands in identified market niches

Cons of not addressing this topic

• Creates ambiguity in the internal procedures to be followed to develop products
• Procedures on product development and modification are not followed or recorded
• Inability to keep stakeholders informed of the product development process and outlook
• Lack of planning means there is a potential to develop products that have low market attractiveness