Download - BSB311 Week 05 2010
-
8/8/2019 BSB311 Week 05 2010
1/33
BSB311: Semester 2, 2010Week 5: New Product DevelopmentStrategies
-
8/8/2019 BSB311 Week 05 2010
2/33
What are the most important things that
should be remembered whenformulating a product developmentstrategy?
-
8/8/2019 BSB311 Week 05 2010
3/33
Objectives of the New Product
Development Process
For new product development (NPD) tobe successful, it must achieve threegoals:
1. Maximize fit with customer requirements interms of quality, feature, pricing, etc.
2. Minimize development cycle time in orderto bring product to market early and beginamortizing costs.
3. Control development costs so that the
project earns a positive return.
-
8/8/2019 BSB311 Week 05 2010
4/33
Management of new product
development
New product
lines
New to the
world
products
Repositioning
of existing
products
Additions to
existing
product lines
Improvements
of existing
products
Newness
to
firm
Newness to market
Low
Low
High
High
-
8/8/2019 BSB311 Week 05 2010
5/33
Primary causes of New Product Failure
(based on empirical studies) Poor market analysis
Product defects
Weak marketing effort NPD costs too high
Strong competitor reaction
Poor timing of product launch Production problems
Other causes
-
8/8/2019 BSB311 Week 05 2010
6/33
Critical success factors (NPD)A superior product with unique benefits
and value for the customer
The company chooses an attractive
market where there is a great need The development team understands the
customers need (in-depth marketanalysis)
The goals of the NPD project are alignedwith companys strategic goals
Competitors analysis (how competitors
meet customers needs)
-
8/8/2019 BSB311 Week 05 2010
7/33
All regulatory and IP issues are identified andaddressed
Project decision criteria are identified and
prioritised (e.g. time to market, cost, ) The project leverages the companys technical
capabilities
The company positions the product correctly
The most effective distribution channel is chosen Endorsement by upper management
The company executes the NPD process withhigh levels of quality
-
8/8/2019 BSB311 Week 05 2010
8/33
The New Product Development Process (Coopers stage-gate& platform development by Miller and Morris)
-
8/8/2019 BSB311 Week 05 2010
9/33
-
8/8/2019 BSB311 Week 05 2010
10/33
-
8/8/2019 BSB311 Week 05 2010
11/33
Management of NPD Two key issues -
1) Product effectiveness, i.e., are the firmproducing the right new products
2) Process performance, i.e., the speed andproductivity of NPD
Three related key problems -
1) The integration of customers demands andmarketing in NPD
2) The integration of manufacturing in NPD
3) Measure the effectiveness of the NPD
process and make continual improvement
-
8/8/2019 BSB311 Week 05 2010
12/33
Tools forMeasuring New Product
Development Performance
New Product Development Process Metrics include:
1. What was the average cycle time (time-to-market) fordevelopment projects? How did this cycle time varyfor projects characterized as breakthrough, platform,or derivative projects?
2. What percentage of development projects undertakenwithin the last five years met all or most of the
deadlines set for the project?3. What percentage of development projects undertakenwithin the last five years stayed within budget?
4. What percentage of development projects undertakenwithin the last five years resulted in a completed
product?
-
8/8/2019 BSB311 Week 05 2010
13/33
Time compression in the NPD
In biotech and other science-based industries anissue
Document the workflow associated with the
product development process (eliminate non-critical steps Set goals for completion times (e.g. Procter &
Gamble reduced its 80-week drug research cycleto under 15 weeks)
Make the team accountable for its performance To simplify things Dont add more people and dont ask for more
hours
-
8/8/2019 BSB311 Week 05 2010
14/33
Case Study: BTF Decisive
Microbiology
-
8/8/2019 BSB311 Week 05 2010
15/33
Disease causing Microbes (Bugs) havealways threatened human health
Threat will continue and intensify due to the rapidemergence of Bugs due to a number of factors
Genetic change and evolution Resistance to treatments
Modern processing techniques More susceptible population
Rapid population growth
-
8/8/2019 BSB311 Week 05 2010
16/33
Big Bug Threats
AeromonasE.Coli
E.Coli 0157HeliobacterLegionella
ListeriaStaphyloccusSalmonella
StreptococcusPseudomonas
BSEHIV
HepatitisCryptosporidium
Cyclospora
-
8/8/2019 BSB311 Week 05 2010
17/33
First Internal Quality Control for
Microbiology
Broad Applications in Multiple High
Growth Markets
Proven Success with Initial ProductRelease
The BTF Opportunity
-
8/8/2019 BSB311 Week 05 2010
18/33
Substantial Industrial Markets
Clinical (approx 1.7 billion tests pa)
Pharmaceutical (approx 300m tests pa)
Food & Beverage (approx 670m tests pa)
Environmental (approx 44m tests pa)
Research & Other (approx 150m tests pa)
-
8/8/2019 BSB311 Week 05 2010
19/33
BTF Decisive Microbiology
Incorporated - March 1999
Directors
Mark Gauci Optoelectronics (CEO, Founder)
Graham Vesey Microbiology (CTO, Founder)
Employees (2001)
11 full-time
2 part-time
Turnover July 2000 - $500K PA
July 2001 - $1M PA
-
8/8/2019 BSB311 Week 05 2010
20/33
PlatformT
echnologiesAbsolute Numbers of microorganisms for
AnalyticalMicrobiology
Internal Quality Control forAnalytical Microbiology
-
8/8/2019 BSB311 Week 05 2010
21/33
Products
EasySeed C&G Exactly 100Cryptosporidium and 100 Giardia in a testtube
ColorSeed C&G - Exactly 100 redCryptosporidium and 100 red Giardia in atest tube
EasyStain C&G FITC
immunofluorescent antibody Kit
C&G IMS specialised test reagent
Original focus was the Cryptosporidium and Giardia water testingmarket.
-
8/8/2019 BSB311 Week 05 2010
22/33
Before BTF
Mark Gauci and Graham Veseyperforming R&D at Macquarie
University
Frustrated with lack of
commercialisation of R&D outcomes
Career paths uncertain
-
8/8/2019 BSB311 Week 05 2010
23/33
March 99 - requirement for someone to manufactureIMS C&G specialised reagents for water testing
Started BTF
Proteome Systems Ltd (PSL) allowed BTF accessto laboratory space
Sold testing reagents to Macquarie University for on-sale to testing laboratories
How did BTF start?
-
8/8/2019 BSB311 Week 05 2010
24/33
Identified a demand for EasySeed product
Domestic
Global
EasySeed production required a flow cytometer (cost
$120,000)
EasySeed C&G
-
8/8/2019 BSB311 Week 05 2010
25/33
$120K needed to purchase a
flow cytometer Banks would not loan BTF money
Turned down by lease companies
Saved all revenue
Purchased cytometer
Developed a method for producing EasySeed C&G
EasySeed C&G sales took off Australia and US
-
8/8/2019 BSB311 Week 05 2010
26/33
ColorSeed
Use revenue from contract and EasySeed C&Gsales to develop a new product
ColorSeed C&G an internal quality control forCryptosporidium and Giardia testing
The first ever internal quality control for microbiologytesting.
Applied to AusIndustry for an R&D START
Used our sales revenue projections as matching
money
-
8/8/2019 BSB311 Week 05 2010
27/33
ColorSeed R&D
$400K project
Appointed an experienced research scientist
12 months of R&D whilst running business andensuring sufficient sales revenue
R&D very successful
A robust method forColorSeed C&G production
-
8/8/2019 BSB311 Week 05 2010
28/33
Commercialisation of
ColorSeed
Submitted application to AusIndustry for aConcessional loan
Application successful
$700K project
Recruit commercialisation staff
Submitted application to Yellow Pages smallbusiness ideas awards program and won NSW
division!
-
8/8/2019 BSB311 Week 05 2010
29/33
Commercialisation to date
EasySeed C&G Gold Standard
Sales in 14 countries
ColorSeed C&G
Production plant scale-up Product Released Sept 1 2001
Sales immediately
EasyStain C&G FITC
Product sales (US, Japan)
Worldwide released 2001
EasyPC
BioBall
-
8/8/2019 BSB311 Week 05 2010
30/33
Commercialisation & NPD Strategy
Release Product
Leaders
RegulatoryApproval
ISO
Method
Target influential people
Scientists
Regulators
Potential customers
Contact customers directly, frequently
Telephone
Email
Travel
Distribution
Direct sales from Sydney
Suitable distributors
-
8/8/2019 BSB311 Week 05 2010
31/33
Example : Biomedical Devices
Product Design,Prototype development,and Testing
Cost Cost/Function
Simplicity andease of use
ExpandabilityQuality
Technology
-
8/8/2019 BSB311 Week 05 2010
32/33
Biomedical Devices
Medical equipment and products usuallyrequire extensive testing (testing is verycomplex)
Some equipments used in operating theatres
must follow rigorous electrical safetystandards and may use special materials
Design and manufacturing process are notdifferent from other products (extensive
testing and quality control required, also mayneed special environments, e.g. clean rooms,or additional process, e. g. sterilization,packaging)
Regulatory requirements must be met
-
8/8/2019 BSB311 Week 05 2010
33/33
Next Week: Guest SpeakerDr Nicky Milsom, Deputy CEO,Magnetica Limitedz Magnetica Ltd