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The best practices for New Product Introduction (NPI) in Manufacturing

14/03/19 Tommy Beazley Principal Consultant, Manufacturing & Operations

Fifty percent of product launches don’t hit their targets. Any business looking to boost revenue growth needs to launch new products or services. More than 25 percent of total revenue and profits across industries comes from the launch of new products, according to a report by McKinsey. 

Research has also shown that companies that focus on creating new products and services while maintaining core competencies across functions grow faster than their peers. And as companies look to future growth, the overwhelming majority expect it to come from creating new products, services, or business models.

In a world which is highly digital, companies are continuously striving to improve existing products or introduce new models to ensure they keep up with digital trends. What we often fail to recognise is all the work that is involved in the design, development and introduction of new products (NPI). 

Why is it so difficult to launch a product?

 Technology has made good product launches more challenging. It has lowered the bar for product development, allowing companies and start-ups to roll out more launches more quickly and cheaply. Digital technologies in particular have allowed companies to rapidly pilot and scale new services, from loyalty programs to support for existing products.

As the risks of failure inherent in every new product situation vary, so too do the returns. The balance of investments, risk and returns is a major criterion in deciding whether or not to proceed with a new product. Acknowledging that virtually every new product will inevitably carry some sort of risk does not, however, prevent attempts to reduce such a risk to a minimum.

The introduction of new products that consumers and OEMs demand require detailed information, time and dedicated resources from an organisation. Companies who successfully develop and launch  new or revised products regularly follow a structured and well-planned process. New Product Introduction (NPI) helps bring all the right resources together at the right time. 

With shorter life cycles and the demand for greater product variety, continual pressure is put on NPD teams to produce a wider and varying portfolio of new product opportunities and to manage the risks associated with progressing these through from initial development to eventual launch

Bringing a successful product to market is a team effort. While the design engineers job includes managing the design process, encompassing customer usability and user experience there are many factors which contribute to the success or failure of new product development and many of these are outside of the design engineer’s direct control. 

A New Product Introduction (NPI) program encompasses all the activities within an organisation to define, develop and launch a new or improved product. The product can be a tangible device, like a car, mobile phone and instrument or intangible as in a service which is being offered. The NPI process can vary greatly from organisation to organisation. In some cases, it can actually vary within different divisions of the same company. For a new product introduction process (NPI) to succeed it must have the full active support of management across business sectors and departments. An effective NPI program involves a large amount of cross-functional communication and teamwork.

Most successful organisations realise the importance of implementing a NPI process. In today’s highly competitive market, companies must develop the right product, at the right time and the right cost. Developing and following a robust NPI process can denote the difference between success and failure. Some of the many advantages of a robust New Product Introduction process include:

  •  Reduced Development Cost: By incorporating the Voice of Customers (VOC) in the early stages of the project, the product design team can avoid late design changes, multiple revisions and repeated costly validation testing.
  • Faster Time to Market: With a reduction in development time, the product will reach the consumer faster.
  • Efficient Manufacturing: Through the effective use of Design for Manufacturing and Assembly (DFM/DFA) best practices, products are designed with the process in mind.  
  • Improved Product Quality: The NPI process incorporates tools targeted at ensuring the product meets customer needs and the process is capable of producing quality products on a consistent basis.

How do Manufacturers implement New Product Introduction (NPI)?

A New Product Introduction process can consist of various phases or gates. The phase gate system keeps management apprised of the project progress and assures all activities are completed on time to budget. The example shown below consists of six phases:

1. Define
2. Feasibility
3. Develop
4.
Validate 
5. Implement 
6. Evaluate 

Each phase of the NPI process feeds into the next. Many organisations look at the process as having a beginning (define) and an end (Evaluate). Some variations combine Define and Feasibility into one phase and Develop and Validate into another. A lot of companies leave the Evaluate phase out completely, thus losing valuable information for future projects. The NPI process is not a straight line, it’s more of an endless circle or loop. The hardest phase to complete for many organisations is the Evaluate phase. The timing of the Evaluate Phase can vary depending on the organisation, the product being produced, or the service provided. It is generally initiated 30 to 60 days following the production launch. The Evaluate Phase serves several purposes in the product introduction process. This phase provides the team with an opportunity to tie up any remaining documentation tasks, review process performance and collect customer feedback.  

At this stage, the team takes the opportunity to review any lessons learned and document them for future use on other projects. One tool that has proven effective for some organisations is the TGR/TGW exercise. This stands for "Things Gone Right / Things Gone Wrong." During this exercise, the team gathers to take an objective look at the project. Discussion revolves around all the things that went well and all the things that may not have gone to plan or could have been improved. The causes of the TGWs are examined and countermeasures developed to prevent re-occurrence in the next project. The TGRs should be carried over to future projects as a continuous improvement effort within the NPI process essentially closes the loop in NPI, helping to retain valuable information and develop a more robust and progressive NPI process.

Are you looking for your next New Product Introduction (NPI) Manufacturing Engineer job? For a full breakdown of the typical Manufacturing & Operations Recruitment handled by Redline, click here.

To find out more about careers in manufacturing or to see our latest job opportunities, please click here or alternatively contact Tommy Beazley on 01582 878814 or email TBeazley@RedlineGroup.com