New Product Development Tool Benchmarks Market Viability Fast and Inexpensively, Acts As “Early-Warning System”
Product Viability Index Aims to Measure Critical Success Factors Using Methodology Similar to Six Sigma.
Morgan Hill, CA, April 19, 2006 --(PR.com)-- Brown & Company LLC announced today an online validation tool for evaluating market viability for new products. Called the Product Viability Index™, it is designed to act as an “early warning system” for critical product issues and fill an important gap in the research spectrum.
“New products fail at an extremely high rate for a variety of reasons,” said Ronald Brown, principal of Brown & Company LLC. “Unfortunately, most companies don’t have a good methodology for understanding and tracking critical marketplace success factors and correcting major problems early.”
Companies find traditional evaluation tools, like focus groups and tracking studies, too expensive to use on a frequent basis. At the same time, internal systems for managing product development details lack the organization and structure for systematically assessing consumer-related strategic issues. Strategy issues are usually raised in an ad hoc or patchwork fashion, making record-keeping for continuous improvement almost non-existent.
Inspired by “continuous improvement” quality measurement tools such as Six Sigma®, the Product Viability Index provides a structured architecture for measuring qualitative attributes and tracking results over time and a very low cost.
Critics say transferring Six Sigma, or any process with a manufacturing genesis, has limited application in marketing. However there is considerable common ground in terms fundamental building blocks: clear identification of individual components and their performance, improvement over time, a focus on customer needs, and positive impact to the bottom line. The success of quality programs in manufacturing has led companies to search for ways to quantify other important corporate processes.
This regular tracking and standardization of market viability attributes leads to more consistency and predictability – in itself an important step toward reducing product failure rates. According to the Product Development and Management Association (PDMA), 95% of all new consumer products introduced between 1996 and 2001 lost money or broke even.
About the PVI
The Product Viability Index is an online survey, so participants can provide feedback regardless of geography. It standardizes a series of critical success factors developed from a number of sources related to product failure, business models and investment criteria.
Data is primarily collected from internal team members in a variety of functional roles, although it is easy for outsiders to participate. Responses are ranked on a five-point scale. Each of the statements is weighted in terms of importance in a particular category and crafted to gather a specific kind of information. Categories include channel efficiency, differentiation, competitive response, customer need, market dynamics, positioning strength, product design, targets, and team efficiency. Responses are expressed as an Index number. Index numbers can be compared to industry averages.
The cost is about $265 per participant per measurement event, including analysis and reports. (Total cost varies depending on the number of people participating.) This pricing is possible because the data-gathering stage is via online forms. For comparison, a set of four focus groups is about $25,000.
About Brown & Company
Brown & Company is a new products consulting firm that created a unique methodology for measuring product viability in the marketplace. This approach, called Product Indexing, greatly simplifies and standardizes regular measurement of qualitative product attributes from one reporting point to another, and is inexpensive enough to be used regularly. In this sense, Product Indexing is similar to product quality programs such as Six Sigma. It also helps create a common ground that closes gaps in communications among different functional areas. Brown & Company’s principals have extensive new products experience in technology, consumer electronics and consumer packaged goods industries.
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Editors note on White Paper:
Brown & Company is offering a free white paper called How to Validate ‘Market Readiness’ for New Products. It examines reasons products fail to meet company and customer expectations in the marketplace and recommends a practical approach for product validation, starting with, and using frequently, online tools and internal resources. The white paper is free at www.browncompany.com.
“New products fail at an extremely high rate for a variety of reasons,” said Ronald Brown, principal of Brown & Company LLC. “Unfortunately, most companies don’t have a good methodology for understanding and tracking critical marketplace success factors and correcting major problems early.”
Companies find traditional evaluation tools, like focus groups and tracking studies, too expensive to use on a frequent basis. At the same time, internal systems for managing product development details lack the organization and structure for systematically assessing consumer-related strategic issues. Strategy issues are usually raised in an ad hoc or patchwork fashion, making record-keeping for continuous improvement almost non-existent.
Inspired by “continuous improvement” quality measurement tools such as Six Sigma®, the Product Viability Index provides a structured architecture for measuring qualitative attributes and tracking results over time and a very low cost.
Critics say transferring Six Sigma, or any process with a manufacturing genesis, has limited application in marketing. However there is considerable common ground in terms fundamental building blocks: clear identification of individual components and their performance, improvement over time, a focus on customer needs, and positive impact to the bottom line. The success of quality programs in manufacturing has led companies to search for ways to quantify other important corporate processes.
This regular tracking and standardization of market viability attributes leads to more consistency and predictability – in itself an important step toward reducing product failure rates. According to the Product Development and Management Association (PDMA), 95% of all new consumer products introduced between 1996 and 2001 lost money or broke even.
About the PVI
The Product Viability Index is an online survey, so participants can provide feedback regardless of geography. It standardizes a series of critical success factors developed from a number of sources related to product failure, business models and investment criteria.
Data is primarily collected from internal team members in a variety of functional roles, although it is easy for outsiders to participate. Responses are ranked on a five-point scale. Each of the statements is weighted in terms of importance in a particular category and crafted to gather a specific kind of information. Categories include channel efficiency, differentiation, competitive response, customer need, market dynamics, positioning strength, product design, targets, and team efficiency. Responses are expressed as an Index number. Index numbers can be compared to industry averages.
The cost is about $265 per participant per measurement event, including analysis and reports. (Total cost varies depending on the number of people participating.) This pricing is possible because the data-gathering stage is via online forms. For comparison, a set of four focus groups is about $25,000.
About Brown & Company
Brown & Company is a new products consulting firm that created a unique methodology for measuring product viability in the marketplace. This approach, called Product Indexing, greatly simplifies and standardizes regular measurement of qualitative product attributes from one reporting point to another, and is inexpensive enough to be used regularly. In this sense, Product Indexing is similar to product quality programs such as Six Sigma. It also helps create a common ground that closes gaps in communications among different functional areas. Brown & Company’s principals have extensive new products experience in technology, consumer electronics and consumer packaged goods industries.
###
Editors note on White Paper:
Brown & Company is offering a free white paper called How to Validate ‘Market Readiness’ for New Products. It examines reasons products fail to meet company and customer expectations in the marketplace and recommends a practical approach for product validation, starting with, and using frequently, online tools and internal resources. The white paper is free at www.browncompany.com.
Contact
Brown & Company LLC
Ronald Brown
408-779-8946
www.browncompany.com
305 Vineyard Town Center 223
Morgan Hill, CA 95037
Ronald Brown
408-779-8946
www.browncompany.com
305 Vineyard Town Center 223
Morgan Hill, CA 95037
Contact
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