|Book Review: The Pursuit of New Product Development|
The Pursuit of New Product Development: The Business Development Process
Written by: Marc A. Annacchino. New York: Butterworth-Heinemann, 2007. 512+ xii pages.
Product developers work within a business environment where they strive to integrate inputs from marketing, engineering, production, finance, and other operational functions to develop and commercialize successful new products. Marc Annacchino's book is squarely focused on the business planning and process development that are necessary for new products development and management. A sound appreciation of market needs, well-defined business model, strong financial justification, and clear strategic objectives are key elements for success. Annacchino is a professional engineer who brings more than 30 years of general management experience in sales, marketing, new product development, manufacturing, and finance to this project. His background provides for an eclectic perspective that integrates the business planning process with new product development, and he writes from his experience.
This book will appeal to practitioners such as operations managers, program managers, and project managers who are responsible for new product development program. Managers from sales, marketing, accounting, finance, and manufacturing will also find the insights provided here useful as they interact with the NPD process. The book is chock-full of insights, flow charts, worksheets, checklists, and templates.
The basic premise of the The Pursuit of New Product Development is very familiar. Firms must evolve to follow market changes. Consequently, employees must commit to lifelong learning and take personal responsibility for remaining world competitive. The planning approach in this book is offered as a path for doing just that. If one can anticipate changes in the competitive environment and can plan appropriately, then customers, employees, the firm, and societies will benefit.
The objective of the book is to present the reader with a detailed and integrated understanding of the business development process as it influences the new product development program. Somewhat surprisingly, given the book's title, the work does not delve too deeply into the mechanics of the actual new product development program. Instead, it provides insights for operations executives that will improve management oversight of the NPD program. The book has 12 chapters that encompass the entire management process:
The book employs a three-phase planning framework. Phase 1 (Chapters 1–4) addresses front-end planning topics of business objectives, market opportunity assessment, concept development, and the business plan development. Phase 2 (Chapters 5–8) focuses on the internal organizational issues of financial justification, organizational dynamics and communications, development program execution, and manufacturing. The final phase (Chapters 9–11) describes the commercialization process including prelaunch preparations, the actual product launch, and product management. Chapter 12 provides a checklist for the entire process.
Phase 1 begins with an introduction to new product development's role in the economy, in which the author sets the stage for assessing the market opportunity, identifying customer needs, and defining product requirements. In one well-conceived vignette (pp. 8–10) the author emphasizes the importance of government-sponsored research and development (R&D) in terms of technology transfer to commercial product development. The Apollo program of the National Aeronautics and Space Administration (NASA) accelerated the development of technology that eventually produced digital alarm clocks, home insulation, portable video cameras, bar codes, integrated circuits, digital photography, handheld calculators, aircraft avionics and navigation systems, smoke detectors, weather satellites, the Internet, personal computers, cordless tools, and lightweight stadium roofs. In each case the author explores what life would be like if the Apollo program had not happened. It would be a much different world, indeed.
Chapter 3 provides a quick tour through the business interfaces with the new product development process. It is here where idea generation, market planning, and competitive analysis meet product definition, product planning, and development management. Annacchino emphasizes the role of the development engineer in influencing factory cost and providing adequate documentation. Chapter 4 focuses on product and business plan integration by providing numerous insights on do's and don'ts. Of course market and customer input is a key, but the surprise here for development engineers is the emphasis on the importance of the accounting function to program success.
Phase 2, which focuses on internal program management topics, starts with an overview of accounting and finance issues that affect a development program (Chapter 5). The real value here is to remind program participants of the cost justifications and the relationship among risk, reward, and timing. In Chapter 8 the author's real passion for manufacturing emerges, and his depth of insight matches the breadth of this topic. The topics of manufacturing program management, design for manufacturability, manufacturing process layout, process development and control, throughput, cycle time, and quality management are well presented. At 65 pages, it is by far the longest chapter of the book. The author has deep knowledge and experience here, and it shows.
The final phase focuses on managing product launch activities. Chapter 9 presents a prelaunch checklist, which includes getting required certifications, doing pilot manufacturing runs, field testing, creating product literature, training employees, ensuring that adequate infrastructure is in place, developing a product support, training the sales team, developing channels, and reporting feedback. This chapter is exciting, but its checklist is exceptional. Chapter 11, “The Pursuit of Product Management,” summarizes product management topics such as the product portfolio, pricing and market share, growth strategies, product maintenance, production-based quality management, product liability, and product life-cycle management. It serves as a capstone to a book that provides a tour through the topics on the business management side of the new product development process.
The strengths of this book derive from the obvious extensive experience of the author with these business development topics. One cannot gain the insights available here on so many topics without years of situational awareness and process management knowledge that can only come from practice. However, the real strength here is the manufacturing and process insights that come from the engineering perspective that is evident throughout the book. One is left with the impression that the book is more useful for heavy industry rather than high-technology or consumer products firms.
This book has a few weaknesses. First, its title is misleading. It raises the promise of being a book about new product development. It is not. Perhaps a better title might be The Business Development Process as It Applies to New Product Development. It would be stronger if it had sections on managing services innovation, open innovation, user innovation, and participative design, for example. Topics such as these would have provided the book with a more modern feel.
Its biggest shortcoming is the total lack of documentation of the material presented. There is no bibliography or footnotes. This is unfortunate because virtually every topic covered has a vibrant academic and practitioner literature foundation. It is just not present here. This seriously reduces the value of the book for university applications and denies readers in any environment access to additional sources. The book provides a wonderful set of experience-based insights, but the reader could have had a lot more.
One final issue is the extensive use of bulleted checklists and worksheets that are often presented with little detail or explanation. The reader is left to figure out the usefulness and application to the topic at hand. Perhaps the book would have benefited from less breadth and more depth on some topics, especially the product launch.
In conclusion, The Pursuit of New Product Development is not an easily digestible read. It ranges from being overly simplistic in its treatment of the market opportunity and launch topics to being tremendously insightful on program justification, plan execution, and manufacturing development. However, if you are looking for the insights that come from a successful career in this space, then you should mine its wisdom.