| Look to
Customers, not Competitors Craig A. Steffen
New product
development determines the future of every company. Often
we think of product development as being a function of large manufacturing firms like
General Motors or Proctor & Gamble. We
look at our companies as different and therefore exempt from this formal activity. Nothing could be farther from the truth.
No
matter what your business is, manufacturing, service, technology, medical, consulting,
distribution … you must be continuously developing new products in order to survive
and thrive. It’s not optional.
Sometimes
your product is a tangible, three-dimensional item with some unique design properties. Other times your new “product” will be a
modification of a service, or the change in a customer policy that separates you from your
competitors. For knowledge companies, your new “product” may be developed as the
fruit of a seminar or created by learning a new technology.
So
where do new product innovations come from?
Too
many companies look to competitors to get direction on their next innovation. This tendency is reactive in nature and, by
definition, will prevent you from being a market leader.
You can’t pass your competitor in the marketplace if you get your
inspiration from them. You’ll always be playing catch-up.
The
first step in new product development is an honest assessment of what your customers want
AND need. Your current customers are an
invaluable source of information and inspiration – if you listen well. Customer’s “wants” are typically
near-term development opportunities. Customer
“needs” generally represent longer-term opportunities.
When
you start to hear your customer ask for a different product, service or way of doing
business with you, (a want) you don’t have much time to respond before losing that
customer. This customer has already
identified and articulated what they want from you. Because
of this keen awareness, you must meet it with a spirit of urgency.
Conversely,
customers are often not aware of what they may truly “need.” It isn’t their job to understand industry
trends, applicable technology and paradigm shifts. That’s
your job. In 1960 customers were wanting
better and faster mimeograph machines. No
one, but Xerox, imagined that the real need was the first tabletop copier,
which they introduced in 1963. If you’re
lucky enough not to remember mimeograph machines, you’re exhibit number one for this
paradigm shift.
The
second step toward developing new products is to study innovations in successful
businesses that are completely different from yours.
Transistors developed for NASA have revolutionized all things electronic. Assembly lines, the brain-child of Henry Ford,
have transformed many a restaurant. Radically
customer-friendly service policies authored by up-scale clothing catalogs have been
adopted by scores of diverse industries. While
it’s usually counterproductive to look to your own competitors for new product
inspiration, it’s very useful to vociferously study other successful industries to
find things you can adapt to your own.
Time
is of the essence. Once you’ve
determined what new product you’re going to develop, do it quickly. If you’ve thought of it, chances are someone
else in your industry has as well. The U.S.
Patent Office is filled with examples of patent applications for the same invention being
separated by only a few days. Just like at
the Patent Office, being first in time often leads to being first in marketshare.
You
don’t even have to have the original seed-thought, just the first to adapt it for
successful introduction to YOUR customers. There
is no more powerful tool for capturing marketshare than being first-to-market with
something that truly meets your customer’s wants or needs. New product development is simply the ability to
make a connection between you and your customer, where none existed before.
Paraclete
Consulting specializes in helping companies evaluate existing products and develop new
products. Hit "Contact Us" to get a FREE consultation. |
