Factor 1: A High-Quality New Product Process. Does your business have a superb new product process or roadmap to guide and speed new products from idea through to launch? The top performers do. Merely having a process does not make the difference, however. It is the nature of that process, and whether it possesses key success ingredients, that makes all the difference. Some of these success factors that top performers build into their processes include emphasizing the up-front, predevelopment homework; building in the voice of the customer throughout; demanding sharp, early product definition; having tough Go/Kill decision points where projects really do get killed; and highlighting quality of execution throughout.

Factor 2: A Clear and Well-Communicated New Product Strategy for the Business. Do you have a clearly articulated new product strategy for your business? If so, you're in the minority. But businesses that boast such a strategy do better, according to the benchmarking results. Having a new product strategy for the business means:

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• There are clear goals or objectives for the business's total new product effort; for example, what percentage of sales or profits new products will contribute to the business.

• There are clearly denned arenas—specified areas of strategic focus, such as products, markets, or technologies—to give direction to the business's total new product effort.

• Specified resources are allocated or deployed against each arena (for example, how much will you spend on product development in market A versus market B; or on technology platform X versus Y?).

• A strategy for how to attack or win in each arena is defined (for example, whether you'll be a niche player, or low-cost provider, or value-added competitor; whether you'll be the innovator or fast follower, and so on).

• The strategy has a long-term thrust and focus, including some long-term projects and platform initiatives (as opposed to a short-term plan and a portfolio of quick hits and incremental projects).

• And finally, the role of new products in achieving the business's goals and the new product strategy for the business are clearly communicated to all who need to know.

Factor 3 : Adequate Resources for New Products. There is no free lunch in the new products war! Some companies in our studies had cut product development efforts—R&D and marketing money and staff—to the bone in an attempt to produce short-term profits. The longer-term effects are, however, very negative. Top performers commit the needed resources; specifically:

• In top-performing businesses, senior management has devoted the necessary resources—people and money, marketing and technical—to achieve the business's new product objectives. By contrast, average and poorer performers tend to be very short on resources and dedicated players. Marketing resources devoted to new products is a particular area of weakness.

• R&D budgets are adequate—judged to be sufficient in light of the business's new product objectives.

• Finally, the necessary people are in place and have their time freed up for new products. The latter is an important point: often people are designated to be on product development teams, but they are not dedicated—they have their "real jobs" too (for example, marketing and operations people). And time was rarely freed up to enable these people to participate in new product projects as fully as they should have. The resources are there in theory, but not in practice!

Source of Reference:
Robert Cooper, Product Leadership: Pathways to Profitable Innovation, Basic Books. You can obtain this excellent book here

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