4.2 Introduction

When a cool new product hits the market, how do you respond? Take a look at Figure 4.2, which depicts the technology adoption life cycle—a model that describes how people adopt new products. Where would you place yourself? To help you decide, consider the following questions:

• Have you ever camped out overnight to get your hands on the latest iPhone, Playstation, or (fill in the blank) before anyone else? If so, you are likely an innovator.

  Figure 4.1: Waiting In Line Before Dawn—The Apple iPhone XR Launch

• Are you always looking for something new, embracing new technology or fashion, but prefer a more measured approach than camping out and taking risks? If so, you are probably an early adopter.

• Do you prefer to wait for other people to test new products so that the maker—e.g., Apple, BMW, or Samsung—can get the bugs out before you buy? If so, you fit with the early majority.

• Do you view innovation hesitantly? Simply put, do you view innovation as "nice and all," but you don't believe it will live up to the hype and you aren't willing to pay more for it. If so, you belong to the late majority.

• Do you wait for a friend or family member to give you the product as a gift. If this describes you, you are a laggard.

Now, another question: Which customer is most important to your company's success? Let's give you a few seconds to reason out your response. . . . OK, time is up. Let's take a look at the answer and the logic behind it. You need a complete portfolio of customers. Think about it this way. You need innovators and early adopters to create product buzz, helping you achieve a successful launch. You also need more mainstream customers—loyal pragmatists and conservatives generate sustained revenue. Even laggards contribute to the cash flow needed to invest in future products.

The bottom line: You need to develop and manage a new product development (NPD) process that can consistently bring customer pleasing new products to market. New products that customers want to buy keep your company relevant and fund future operations. In fact, highly innovative companies grow three to six times faster than rivals and earn double the profits. That's why new product development is the lifeblood of every company.

You may be wondering, "Whose job is it to bring great new products to market?" The answer: Everyone's! New product development is a process that cuts across almost every function within the firm from marketing to R&D to manufacturing to purchasing to finance. Every one of these functions touches the NPD process. Every one of these functions contributes a unique perspective—and unique skills. But, managing across functions is challenging. If different functions don't work well together, you end up with the swing shown in Figure 4.3. To avoid this outcome, you need to understand what the NPD process looks like and how what you do affects it. Then you can go to work to keep the NPD process running smoothly, bringing the fresh ideas to market that keep customers coming back.