New Products Save Company

By Ken Westray, PE, NPDP

Imagine that your firm reported a $273 million loss, was $16 billion in debt, had very little cash on hand, the previous CEO was let go, and a new COO has been hired. Reports of the new COO cause stock prices to drop 20% on the day of the announcement. Now what?

This company responded by implementing a multiple pronged strategy. It fixed the balance sheet by cutting costs, selling off non-core businesses, and reducing staff. The COO re-engaged with both customers and employees and remained open to constructive criticism that came from these sources.

Results? Based on refocused attention to customers, the company righted the ship and 4½ years later was able to report that 2/3 of its revenue came from products introduced in the previous 24 months.

Consider these questions:

• Does your internal financial reporting system allow you to identify revenue by product or product line to measure success of new product development (NPD)?
• Does your research yield results that allow your company or division to differentiate itself from competition in ways that create measurable value for customers?
• Are you listening to your customers and your own people about what needs to be fixed?
• Where in the product life cycle are your top revenue generators? Are there successors product extensions or innovative new solutions that will allow your company to dominate a new niche and achieve above average margins?

Attention to these questions can enable your company to benefit and it doesn’t even have to be doing poorly to improve.

You, as a major player in new product development within your organization, can be the leader that constantly focuses the team on the value of the voice of the customer!