Business Information: New Product Development

The effect of new technology on product development is examined. A guide to understanding advances and production.

Are improvements in technology responsible for the development of new products? Maybe, in a few cases, yes. But the real question is: "Are these technological advances responsible for successful new products?" I think that it doesn't. Often those who write about future developments in industry and in lifestyles base their predictions on their expectations, often correct, of the advance of technology. I think their predictions are misguided even when their assessment of future technological capability is correct.

Customer needs and wants drive the development of successful products. The role technology plays is the opposite. The lack of the required technology holds back the development of products that, if possible and practicable, could be successfully introduced.

In a former job (with a "high tech" company) that involved planing future product directions and plans, many of my colleagues liked to say that we were in a "technology driven" industry. I disagreed. What drove the sale of our products (industrial automation devices and systems) was the needs and desires of the individuals working for our customers (manufacturing companies). What held us back was the inability, usually due to technological limitations, to produce the desired product at a reasonable cost. As technology improved, the limitations were lifted and new products were brought to the marketplace. My view was that we were in a "technology held back" industry. I think that term could apply to most industry, including the so-called High Tech industry.

Most industries, both those that make capital equipment sold to other industries and those that make consumer products, are driven by customer needs and wants. What holds back the products is the technology, or lack of technology. Improvements in technology allow new and improved products to be designed. Those that meet the consumer needs and wants will be a success in the marketplace.

For example, I, like most people, would like a heavy, roomy, mini-van that has a high gas mileage. (Fifty mpg would be a good start.) However, the technology does not exist to build such a vehicle. The lack of technology is holding back that product. If and when technology improves to allow such a car at a reasonable price, then the product will probably be introduced and will be successful.

Making a product for no other reason than "we can now do it" may sell a few products, particularly consumer products sold at a low price. That reason will sell some products to businesses, particularly if the price is low enough to allow the decision to be made by one person without review by higher levels. However, success will not come to a manufacturer who introduces a product that answers no real user need or want.

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