Processes and Activities to Reduce New Product Failure

Abstract: New product development is an imperative for a company’s survival. Depending on the definition of failure 80-95 % of all new products fail. Extensive research has been carried out in purpose of reducing new product failure rates, but in general the failure rates have not decreased. This thesis is focusing on the new product development process, and which activities companies should undertake to reduce their new product failure rates. We intend to compare product development methods and theories with the practice at companies, and investigate whether formal product development processes and failure rates are connected. We have chosen to carry out case studies at Findus and C Technologies. The empirical data was gathered through interviews with key staff. From our empirical data we cannot find a direct connection between usage of formal new product development processes and reduced failure rates. However we believe that without a formal new product development process the failure rates would be even higher. Our empirical data gives support for the conclusion that the market should direct product development. We have caught a glimpse of some problems not related to the new product development process itself. These problems include competition and personal commitment.