Avoid Using Tomorrow’s Research to Justify Yesterday’s Bad Decisions

alcoholic business man  whiskey drunk at office with computerThe following is an excerpt from the whitepaper 3 Pitfalls of the New Product Development Process by Yui Nagashima.

We know that, too often, companies move forward with new products based on a hunch. They have an idea, see value in it, and decide to progress with the development of a product without thoroughly exploring the market for that product. However, without thoughtful research and abiding by the known principles of NPD, chances are this company and product will encounter difficulties. Then, when the inevitable problems arise, companies look to research to justify their decisions. Demonstrating this point, an HBR article What Entrepreneurs Get Wrong surveyed entrepreneurs in Hong Kong, Kenya, Mexico, Nigeria, the United Kingdom, and the United States to uncover insights on these entrepreneurs’ first sales and what they learned through the process. In discussing their regrets, they shared that “starting late” was a mistake as they missed out on the crucial opportunity of understanding customer needs and reactions before actually developing the product.

Once you’ve developed and rolled out the product, going back to conduct research to guide the product’s development is not cost-effective or efficient. This can create substantial delays in the ultimate progress of the product and can deplete morale and potential market share by an ineffective rollout.

Lesson: Use research to guide the NPD process, rather than trying to correct it once problems arise.

Solution: Test and experiment throughout the product development process, from inception to production. Too often companies first design a product and then figure out a way to sell it. The ultimate success or failure of a product is defined by the customers’ willingness to pay for it. Research, experimentation, and testing should therefore be incorporated throughout the product development process, rather than after the product has already been developed. A few months ago, a prospective Hanover client (that will not be named) asked us how we would use research to ensure the successful launch of their new product:

Hanover Research: “Where are you in the product development process?”

Prospective client: “We’re launching the product next month.”

HR: “What type of research support are you looking for?”

PC: “We have the product, we need you to tell us the size of the market and the best way to sell it before we launch.”

HR: “But what if we find that there is a poor market for your product?”

PC: “Well it’s too late to change the product now…”

We chose not to partner with this organization because they hoped to use research to retroactively affirm decisions to which they had already committed, severely limiting the potential impact of research on shaping and guiding the NPD process. Further discussion showed that they had designed a product that was extremely profitable for them, but of questionable value to their customers. After realizing a product is off-target, clients often lament that they should have conducted more research to support the NPD process. In addition to client testimonials, we’ve learned through experience that had companies such as the one mentioned above conducted more thorough research throughout the product development process, rather than at the very end, they would have had time to adjust their product to the demands of the market. Unfortunately, they are now stuck with a lemon.

Excerpted with permission of Hanover Research, a NPD research provider, from 3 Pitfalls of the New Product Development Process by Yui Nagashima. You can follow the company on Twitter @hanoverresearch.

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