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But
to grow in the new economy of the early 2000s will require new
innovations, new offerings, and new growth. Customers are
cautiously optimist about their future. They will respond to new
offerings if they see a clear benefit from doing so.
So corporations
must look once again at research and development, new products,
new offerings, and new lines-of-business. But not R&D for
its own sake, rather R&D with a very focused purpose - to
deliver new products with revenue (and profit) making potential.
How does this
differ from the R&D environments of the 90s? Historically,
somewhere between 40% and 60% of all new product development
efforts fail. This is no longer tolerable. New development must
up this percentage. What's required? Several critical
differences are immediately obvious:
Return
A new product
offering must demonstrate a reasonable chance of generating
revenue and profit in a fairly short time frame. Projects won't
be approved unless there is a compelling financial reason to do
so. This doesn't have to be a hard return, though - soft returns
(such as increased customer satisfaction) are just as important.
Flexibility
A new product
offering must be flexible to accommodate increasing change in
the market. Deregulation, mergers and acquisitions, shifting and
combining marketplaces - all require the flexibility to
significantly change the direction of a product offering in
mid-stream. A new offering developed at great cost and effort
cannot afford to be made obsolete by a change in the industry or
market; new products have to have flexibility planned into them.
Scalability
To minimize risk,
many new offerings are rolled out in test markets or in beta
trials. To many companies have found a highly successful trial
of a product launched to the entire market failed because the
underlying technology, infrastructure or processes were not
scalable. This results is a double failure - not only is the
original development effort wasted, but the customer goodwill
from the initial trial is turned into customer frustration when
the full launch fails.
How to achieve
this? R&D must become a cross-departmental activity.
Research and Development must work closely with marketing,
sales, customer support, infrastructure, and even finance to
create a true product team instead of fragmented communications
between these different areas. The difference in the final
product is critical. Only new product design, development and
launch by a tightly-knit, cross-functional team will result in
new products that will meet its revenue and profit goals.
Stephen
D. Poe, EDP is CEO of Nautilus Solutions. He has been active in
the electronic printing and publishing industry for 16 years. He
received his EDP from Xplor in 1983 and was recertified in 1998,
and is currently the Southern Region representative to the Xplor
Board of Directors. Stephen can be contacted at sdpoe@nautilussolutions.com
or +1.214.532.0443.
Nautilus
Solutions focuses on "Helping management turn technology
into profits (sm)". If you’re looking to: acquire or
implement new technologies, start-up a software company, expand
your product development team, integrate research and
development teams, or purchase existing software product lines,
call, email or visit us at http://www.nautilussolutions.com.
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