Idea development

1. Idea Development

2. Who are they and what did they create?

3. “That’s an amazing invention, but
who would ever want to use one of
them?”
(US President Rutherford B. Hayes,
after participating in a trial
telephone conversation between
Washington and Philadelphia in
1876).
“Television won’t be able to hold
onto any market it captures after
the first six months. People will
soon get tired of staring into a box
every night (Darryl F. Zanuck, Head
of 20th Century Fox, 1946)
Don’t believe the experts

4. “The horse is here to stay, but the
automobile is only a novelty, a fad”
(President of Michigan Savings
Bank, 1903, advising Henry Ford’s
lawyer not to invest in the Ford
Motor Company – disregarding the
advice, he invested $ 5,000 in stock,
which he sold several years later for
$ 12,5 million).
“I think there is a world
market for about five
computers
(Thomas J. Watson Sr.,
Chairman of IBM, 1943)
Don’t believe the experts

5. Definition
Development of original
products, product
improvements, product
modifications, and new brands
through the firm’s own
R & D efforts

6. The lean mindset
Learn
Measure
Build
• Continuous improvement is the
key principle
• Question every assumption
• Get out of the office. Go out an
learn in the real world – meet and
talk with potential customers

7. The lean mindset
• Push hard as long as you can but
know when to pivot or stop

8. The lean mindset
• Fail fast and learn fast
−Lean is not a linear process – it’s a fluid one
−If you need to its always possible to go back stages
−Make sure you make decisions quickly though

9. New product development phases
Empathise Define the problem Ideate Idea screening
Concept
development and
testing
Marketing strategy
development
Business case
Product
development
Test Marketing Commercialisation

10. Design thinking and idea development

11. Defining the problem

12. Customers (potential customers)
Customer Jobs – (activities)
Jobs describe the things your
potential customers are trying
to get done. These could be
tasks they are trying to
perform, problems they are
trying to solve or needs they
are trying to satisfy
It is important to acknowledge
that not all jobs / activities
have the same importance
Angle Tip
When carrying out potential customer
research its important to first identify
who your potential customers might
be. Don’t waste your time asking
people their views on products or
services that they will not buy.
•For example, mowing the lawn, playing a sport
Functional
Jobs
•When a customer wants to look good or gain power
status
•For example – brand aspiration – Ferrari, Hugo Boss
Social Jobs
•When customers seek a specific emotional state such
as peace of mind or feeling secure
•For example – private healthcare
Personal
jobs
Supporting
Jobs
• Buyer of value – physically choosing and purchasing
• Cocreator of value – those that leave feedback
• Transferrer of value – reselling a product, upcycling a
product

13. Customer pains
• Anything that annoys
customers before, during
or after trying to get a job
(activity done).
• Pains also describe risks –
potential bad outcomes
related to getting a job
(activity) done badly
• Function – this does not work
properly
• Social – I look bad in this
• Ancillary – its annoying
Undesired
outcomes,
problems and
characteristics
• These are things that prevent
customers from starting their
activity – I can’t afford it, I
don’t have the time
Obstacles

14. • Example trigger questions:
−How do your customers define too costly? Too much time, money or
effort?
−What makes your customers feel bad? What are the frustrations or
annoyances?
−How are current products / services underperforming? What features are
missing? Are there performance issues?
−What are the main difficulties and challenges your customers encounter?
−What risks do your customers fear?
−What’s keeping your customers awake at night?
−What are the barriers your potential customers face when adopting your
product?

15. • Customer gains
− Gains describe the
outcomes and
benefits your
customers want.
Some gains are
required,
expected and
some are desired
and some would
even surprise
them.
•These are gains without which the solution
would not work
•For example, a smartphone making a phone call
Required
gains
•Relatively basic gains that we expect
•For example – an iphone being well designed
and looking good
Expected
gains
•These are gains that go beyond what we expect
•For example – our smartphone to sync with
other areas of our life – e.g. email
Desired
gains
Unexpected
gains
• These are gains that go beyond customer expectation
and desire

16. The value map
List all
products and
services
Outline pain
relievers
Outline gain
creators

17. Products and Services Gain Creators Pain Relievers
• Products and services
− This is simply a list
of what you offer
− Physical
(products)
− Intangible
(services)
− Digital
− Financial
• Gain creators
−Describe how your
products and services
create customer gains
−Focus on the most
relevant and important
gains where you can
make a difference
−Typically saving time,
money, effort
• Pain relievers
−Describe how your
products or services
alleviate customer
pains
−Again focus on the
most relevant ones
−Typically
−Underperformance
−Cost, time, effort

18. SCREENING AND TESTING

19. Screening the Idea
• Once all viable ideas are gathered and managed, they must be
further developed, examined, prioritized and evaluated so that a
single product idea is selected for further development into a
product concept. This whole process is called screening and is the
main problem to solve in this level using different tools and
techniques.

20. Screening the Idea
• Two potential risks in screening
• Dropping ideas too early means missed opportunities!
• Developing the "wrong" ideas means wasted resources in terms of
time, financial investments and may risk your activities with your
current portfolio

21. Early stage product development

23. Tools and Solutions
Assessing New Product Feasibility
Is there a need?
Is it real?
Will the customers buy?
Will it satisfy the market?
Is the product real?
Can it be made?
Differentiation?
Can we win?
Low cost position?
Industry structure?
Company competitive? Organizational
effectiveness?
Is the return adequate?
Is it worth it?
Is the risk acceptable?
Supports company's
objectives?Satisfy other needs?
Other factors?

24. Market Research to help screening
Wider world
Industry
Competition
Customers

25. PESTLE
Bigger
picture
Political
Economic
Social
Tech
Legal
Environmental

26. How can concepts be tested?
• Focus Groups
• One-on-One Personal Interviews
• Phone Interviews
• Postal Surveys
• Internet Surveys
• Hybrids (e.g., phone-mail-phone)
• Prototyping & Rapid prototyping
• Alpha, Beta & Gama Tests

27. The “Mom” test
• Avoid asking customers questions that if they asked their own mum she
would lie to them.
• Instead only ask questions that would mean she would tell the truth
−Stop fishing for compliments – avoid questions like “do you like it”?
−Focus on the customer needs not your product
−Stop pitching – don’t describe the features of your solution as if you
are on a sales call.
−Listen and learn about your customers and their challenges
−Don’t ask questions about the future – questions such as “would you
buy this product” and “how much would you pay” are not very useful.
−Its better to run experiments to test their willingness to pay.

28. What tests could you carry out?
• Pick some tests which would check:
−Whether its feasible
−Whether its desirable
−Whether its viable

29. Product development
• What have we learnt
from our customer
discovery and validation
testing?
• How do we improve the
product to make it more
appealable?
• Are we addressing the
right pains and creating
the most important
gains?

30. Pivot, Persevere, Stop
Seven types of pivot possibility
1. Customer segment pivot – changing your customer focus
2. Customer need pivot – changing the way you potentially market
3. Zoom in pivot – focusing on one specific part of the business
4. Zoom out pivot – creating a wider focus
5. Value chapter pivot – this is a change in the revenue model
6. Channel pivot – a change in how you reach or distribute to your
customers
7. Technology pivot – utilising different technology to deliver the idea

31. Launch Strategy
Customer has
never heard of
me
Customer has
heard of me
Customer starts
to listen
Customer
makes decision
Customer buys

32. BUSINESS CASE

33. Where are
you now?
Where do
you want
to go?
How are
you going
to get
there
The business plan

34. The business plan
Do you
know?
Who
What
WhyHow
When

35. Business planning - contents
1. Executive Summary
2. Market Research
3. Products and services
4. Marketing and Sales
5. Operational Plan
6. Management
7. Financial Plan / Forecasts

36. YR3
£K
£k
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£k
£k
?
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Curre
nt
year
YR1 YR2
?
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3
0
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Gross Margin
Net Profit
Business
Value
Personal
Income
Turnover
Set 3 year targets for them.
Business case – vision orbit

37. Business case
• Road mapping
EU
Launch
UK
Launch
Soft
Launch
TestingR&D
Month
1
Month
6
Month
12
Month
18
Month
36

38. Product launch checklist
1. Have I analysed the competition and understood the market size?
2. Do you understand who you are targeting and why they would buy it?
3. Have you built a landing page / social media business page?
4. Have you created a journey with your marketing that leads your
customers along a specific path to a sale?
5. Have you set specific and achievable goals for the short term, medium
term and maybe even long term?
6. Have you planned a big launch date and is this related to anything else
that’s going on in the outside world?

39. Causes of New Product Failures
• Overestimation of Market Size
• Product Design Problems
• Product Incorrectly Positioned, Priced or Advertised
• Costs of Product Development
• Competitive Actions
• To create successful new products, the company must:
− understand it’s customers, markets and competitors
− develop products that deliver superior value to customers.

40. Summary
• New Product Development can be a costly, timely and ultimately
unsuccessful process
• Plan each stage of the process and do not underestimate the time the
whole process will take
• Listen to customer / potential feedback. Remember customers should be
at the heart of everything you do
• Do you need to do NPD? Can you innovate existing products or reach new
markets?