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Understanding the Value of your Product – Before you Develop it!

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Do you truly understand the value your customers place on your product offering?

Your approach to product development will directly affect your ability to create money-making products your customers must have versus products that provide no value to customers and contribute nothing to your bottom line. Developing a must have product instead of a lame-duck depends on how well you understand the value your customers seek coupled with your ability to create it. The methods you use to define, rate and rank customer requirements need to help you understand the voice of the customer, allow you to probe the customer’s beliefs, desires, usage model and then use the results to answer the trickiest product development questions. Such as:

  • what are the meaningful attributes/market requirements your customers seek?
  • how can you rate, rank and track these attributes such that you know what development tradeoffs can be made and how will these tradeoffs affect product performance?
  • which of these attributes will allow you to create sustainable competitive advantage in the market?

Industry best practices, and indeed our own experiences, have shown that organizations that can identify their customers’ value-based needs and turn those needs into successful products exhibit many of the following characteristics:

  • process by which they foster and manage innovation;
  • structured approach to the fuzzy front end of the development cycle;
  • consensus building and buy-in of the cross functional development team;
  • clear, concise and prioritized customer requirements generation that are tracked using metrics;
  • single New Product Introduction (NPI) process everyone in the company uses; and
  • quantitative business case methodology to help identify where to invest development dollars.

Applying these types of methods can help you avoid feature creep in your product development process and keep you focused on what your customers truly value. By having the data collection, processing and analysis work performed by a cross-functional team the clarity of requirements and the credibility of the final product is greatly improved. Also, use of these methods has been shown to foster an environment where increased buy-in of key participants in the product development process is achieved. What is your experience with your company’s NPI process? Leave a comment below…

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