A theory of successful product breakthrough management: learning from success
| Pages | 35-55 |
| Date | 01 February 2000 |
| Published date | 01 February 2000 |
| DOI | https://doi.org/10.1108/10610420010316320 |
| Author | A. Coskun Samli,Julie Ann E. Weber |
| Subject Matter | Marketing |
A theory of successful product
breakthrough management:
learning from success
A. Coskun Samli
Research Professor, Department of Management, Marketing and
Logistics, University of North Florida, Jasksonville, USA
Julie Ann E. Weber
Project Leader at Wistacon Co. and MBA student in the Department
of Management, Marketing and Logistics, University of North Florida,
Jacssonville, USA
Keywords Product innovation, New product development, Product management
Abstract Posits that developing breakthroughs is much more costly and risky than
introducing simple product line extensions. Therefore, breakthroughs need to be managed
differently. After developing a model to manage breakthroughs, generates a series of
hypotheses and tests them against the information obtained from 30 major companies.
The companies were chosen on the basis of one successful product that lasted over a
decade in the marketplace. They were chosen from 143 product-companies and only 30 of
the products in question had survived. Provides important information regarding the
management of breakthroughs.
Introduction
Although in today's standards it is difficult to imagine life without fax machines,
personal computers, high-speed copiers and certainly without a car, a few years
ago we did not have many of these products. They entered our lives and
changed them permanently. These were all breakthroughs. Whereas the Salk
vaccine made an incomparable difference in our well-being as consumers,
Tender Vittles which is another new product, a cat food, did not make a similar
impact on our lives. In this article, adding Tender Vittles to a line of pet products
is considered to be a line extension, the development of the microwave oven, on
the other hand, was a breakthrough. As the society becomes more complex, the
need for breakthroughs is likely to increase, however the cost and risk of such
developments may be prohibitive. While breakthroughs are quite rare and
special, line extensions are plentiful and commonplace.
A firm's ability to remain viable in the marketplace is dependent on its
ability to compete. Often the firm's competitive advantage revolves around
its ability to generate new products that makes a difference. This special
ability is an integral component of its successful growth and increased profits
(Booz et al., 1983). Developing a new product that truly makes a special
impact in our daily lives is difficult, risky and costly. But, developing truly a
successful new product is almost an impossibility. American markets have
been flooded with new products that do not last long. Only 56 percent of all
new products launched are still in the market after five years (Power, 1993).
The current issue and full text archive of this journal is available at
http://www.emerald-library.com
The authorsacknowledge the cooperation theyhave received from 30 major companies
that participated in this study. The authors also acknowledge the help they received
from Tom Jedlik, research assistant, and from Eric Reinhardt, of Computer Services at
the University of North Florida. Two anonymous reviewers of the Journal of Product
and Brand Management made valuable suggestions that improved this manuscript.
Breakthroughs
Variation of existing
products
JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 9 NO. 1 2000, pp. 35-55, #MCB UNIVERSITY PRESS, 1061-0421 35
An executive summary for
managers and executive
readers can be found at the
end of this article
Most of these products are simple variations of existing products. Most
companies, unfortunately, consider producing the same products in less time
and at lower costs as the ruling principle of their product development
philosophy. Working on, hopefully, better quality products developed in less
time and at lower cost, by definition, forces the company to stear clear from
developing breakthroughs. This orientation is less risky, less costly, and it
generates quick results in the short run (Thorpe, 1995; Reddy et al., 1994).
Even though such an orientation presents an improvement over existing
products, it does not at all set the tone of new product development efforts to
generate breakthroughs.
However, in order to improve the firm's competitive advantage through new
product development, the company must be able to develop and introduce
major product breakthroughs (Samli et al., 1987). Although it is much riskier
and high cost to develop these breakthroughs they enhance the firm's
viability as well as profitability.
Just what are the requirements of generating breakthroughs? How are they
developed? What are the management practices? In order to answer these
questions, this paper follows three distinct paths: one, it identifies and
distinguishes breakthroughs from simple line extensions. Two, it develops a
model of breakthrough management process, and generates a series of
hypotheses on managing breakthroughs. And three, it tests these hypotheses
based on the study findings. This paper's conclusions are expected to make
at least a modest contribution in the development of a theory of successful
product breakthrough management which is much needed and not quite
developed yet.
Key trends in the new product development process
In order to understand the conditions under which successful new products
are developed, two key approaches can be used. First, the reasons for product
failure are explored. Second, the reasons for product success are examined.
Although both are good approaches, typically reasons for failure have been
explored more readily than the other approach. However, the authors believe
that knowing the causes of failure does not necessarily imply mastering the
skills of developing successful products. Success here must be examined
according to its own merits.
Indeed, analyzing failures can teach us what not to do, it falls short of telling
us what really needs to be done. Generating new ideas, developing new
products are difficult, risky and costly. Finding the right products and
marketing them correctly are even costlier and more difficult tasks (Power,
1993; Booz et al., 1983; Kotler, 1997). But none of these tasks or steps
clearly identify how to develop a breakthrough which calls for a different
mind-set, a different orientation and creates a new category of products
(Olson, 1996).
In exploring successes, analyses also have been typically concentrated on
very broad-based stages such as Cooper's (1990) stage-gate system which
operationalizes the total new product development process from the initial
ideation stage through the culmination of the product launch stage. There
also have been further attempts to generalize the new product-launching
process (Beard and Easingwood, 1996; Kuczmarski, 1992).
Another research activity has been in the direction of accelerating ``time to
market'' (Millson et al., 1992; Rosenau, 1998), or reducing costs to
accelerate the new product development process (Crawford, 1994). Although
important, again these research streams do not reflect the development and
marketing of breakthroughs.
Variations of existing
products
Analyzing failures
36 JOURNAL OF PRODUCT & BRAND MANAGEMENT, VOL. 9 NO. 1 2000
To continue reading
Request your trial