Arena Blog

How every department contributes to new product introduction (NPI)

By A M
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teamworkWhile a lot of the big picture questions (like, how much do we expect to make from this product, why are we launching something new in the first place, etc.) are VP or C-level questions, a successful new product introduction (NPI) is something everyone in the organization must help with. Here are some things engineering, operations, sales and marketing should consider during the NPI process.

Has operations considered:

  • How to kick off/manage the various production phases (prototype, pilot, production)
  • The supply chain strategy—are you consigned, turnkey, hybrid or ”appliance” manufacturing?
  • CM selection—will your CMs operate locally or offshore, and should you go with an ODM?
  • Production strategy—will you build to order or build to forecast?
  • Time that needs to be added for the quality assurance process
  • Your production capacity requirements, plans for expansion
  • The Finished Goods (FGI) warehouse/distribution plan
  • Repair center process and costs
  • Cost reduction

Have engineers taken some time to discuss:

  • The NPI process (gates, deliverables, approvals)
  • Product data management and engineering changes
  • Part numbers—custom vs. standard, commonality
  • Design Verification Testing (DVT)/QA
  • Product Reliability testing (HALT)
  • Test specs
  • Available diagnostics
  • Special test equipment
  • Feedback loops

Have sales and marketing thought about:

  • Sales channels—will you use a direct model, or work with distributors  or partners?
  • Sales regions—there are different considerations if you’re selling domestically than there are if you’d like to expand your customer base to Europe, China, India or Brazil)
  • Standard order ARO requirements
  • Terms and conditions
  • Stock Keeping Units (SKU’s)—how many do you need to have available?
  • Sales forecast process
  • Customer warranty—how will you manage returns and spares?
  • Compliance (UL, FCC, RoHS, WEEE, FDA)
  • Software delivery scheme (CD, web-site access)

And for every department, it’s important to make sure the right business systems are in place.

In particular, the following systems make it much easier to manage the new product introduction process:
  • Product Lifecycle Management (PLM)—for design and manufacturing documents, BOM and change management and compliance
  • Enterprise Resource Planning (ERP)—for purchasing, inventory, order administration and finance
  • Customer Relationship Management (CRM)—for sales forecasting and customer orders, pipeline management, RMAs, return rates, customer case history and warranty entitlement

To learn more about new product introduction (NPI)

If you’re interested in learning more about new product introduction best practices, read our Best Practices for NPI and NPD Success whitepaper.