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Stages of NewProduct Development

New Product Success Rate

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Cost Elements of a New ProductComparative Expenditure on a New Product

Stage of Development Cost Conception $5,000 + Feasibility $50,000 (Depending

on industry) Product/process

development20 x Cost of Feasibility

Pilot production 20 x Cost of Development

Full commercialization Much more costs

Traditional Commercialization Model

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Engineering Stages of NPD

1 - Conceptual Proofing

• Prove concept to be scientifically valid via test-of-principle model(s)

• Confirm that performance assumptions are reasonable

• Identify critical manufacturing and marketing barriers

• Conduct a state-of-the-art survey to identify potential product gaps

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2 – Technical Feasibility • Confirm target performance through

experimentation• Identify operational requirements• Identify potential safety hazards or

environmental impacts• Make a preliminary production

feasibility assessment• Make a preliminary manufacturing

assessment

3 - Development

• Make needed improvements in materials, design and processes

• Design and fabricate an engineering prototype for scaling up at a later stage

• Optimize the product through design iterations

• Conduct final tests after all modifications

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4 – Pre-Product Preparation

• Develop manufacturing techniques• Establish test market validity of the new

product• Complete a pre-production prototype• Specify the pre-production process• Design a field support system

5 – Full-Scale Production

• Finalize commercial level design features

• Specify detail manufacturing processes• Finalize distribution system and

customer assistance process• Operationalize manufacturing facilities• Perform trial manufacturing runs under

full-production conditions

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6 – Product Support • Provide technical instructions and

updates for effective use of the product• Provide instructional and maintenance

manuals and warranty services• Produce and distribute spare parts• Identify new product spin-offs or major

design changes• Ensure maximum product value through

engineering improvement

Engineering Stages of NPD

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Engineering & Marketing Influence

Summary• Engineering and business activities

must be closely integrated in this NPD process

• This 6-stage approach incorporates simultaneous steps and participation by engineering and business units

• This process involves a significant manufacturing effort for substantive products