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Relationship Between Speed-to-Market and Product Success
- At a high level of generality Speed-to-Market is associated with new product success.
- However, this picture becomes more complicated when considering individual businesses and products:
- there are businesses and products for which increasing Speed-to-Market is likely to increase product success,
- there are others for which it may not.
- One performance trade-off is made at the project level.
- If a project team receives appropriate top-management support, they have access to more company resources and perform well with the increased motivation to do well.
- However, it has been observed that when project teams are put under unrealistic project milestones, their performance and probability of success suffers.
- Another high level trade-off relates to the relationship between speed-to-market and ultimate project commercial success.
- This trade-off is based on the type and level of uncertainty in the market and the technology needed for commercializing the product.
- Uncertainty in this case takes two forms, knowledge of individuals in the company and rate of change in the knowledge base worldwide.
- For the knowledge of individuals in the company, there are three main categories;
- known by company personnel,
- unknown by company personnel but known to others in the world,
- and unknown by all in the world.
- Rate of Change in these cases takes two forms, low and high.
- The relationship between product commercial success and development speed is generally an inverted-U when the rate of change in either the market or technology is high, that is, increasing development speed increases product success up to some point after which it becomes detrimental.
- The relationship between product commercial success and development speed is also an inverted-U when market and technology rate-of-change are low but when the technology knowledge is unknown to any person in the world (i.e. breakthrough innovation is required). Likewise, relationship between product commercial success and development speed is also an inverted-U when the market newness is high, that is a market wherein the market or business model is new market is not yet known to any person in the world.
- The relationship between product commercial success and development speed is generally is linear when market familiarity is high and when technology familiarity is known to company personnel (or at least by someone else in the world), and both market and technology rate-of-change are low.
- Studies of product development speed do not show whether development speed leads to improved product success or whether businesses that are more successful at developing new products also become better at managing development speed due to their overall product development capabilities.
- “Best vs. the rest” comparisons show that the best performers are substantially better at managing time-to-market (see Fig. 1.3, page 15 of Robert G Cooper Winning at New Products 5th ed. 2017).
- It is likely that better performance in executing Speed-to-Market is a consequence of better overall new product development capabilities.
- The implication of this for firms aiming to improve Speed-to-Market, is that their emphasis should be on improving their overall product development capability rather than having a narrow focus on Speed-to-Market.