international product development strategy : few example

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INTERNATIONAL PRODUCT DEVELOPMENT STRATEGY: FEW

EXAMPLES

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LOVELY PROFESSIONAL UNIVERSITY, DEPARTMENT OF MANAGEMENT

SEMINAR ON CONTEMPORARY ISSUES IN INTERNATIONAL BUSINESS

On

International Product Development Strategy: Few Examples

Submittedto Lovely Professional University

In partial fulfilment of the requirements for the award of degree of

Master of Business Administration IB

Year-2013

Submitted to Submitted by:

Dr. Mahesh Chandra Joshi Pankaj Mishra

A-03

DEPARTMENT OF MANAGEMENT

LOVELY PROFESSIONAL UNIVERSITY

JALANDHAR NEW DELHI GT ROAD

PHAGWARA

PUNJAB


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INDEX

Serial No. Topic Name

1. Introduction

2. Objectives

3. Review Of Literature

4. Several Subset Of PDS

5. Basic Steps of PDS

6. Few Example7. McDonalds in india

Introduction

Strategy

Business model

8. Volkswagen in india

Introduction

Strategy9. Conclusion

10. References


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INTRODUCTION

In business and engineering,new product development (NPD) is the complete

process of bringing a new product to market. A product is a set of benefits offered for

exchange and can be tangible (that is, something physical you can touch) or

intangible (like a service, experience, or belief). There are two parallel paths involved

in the NPD process: one involves the idea generation, product design and detail

engineering; the other involves market research and marketing analysis. Companies

typically see new product development as the first stage in generating and

commercializing new product within the overall strategic process ofproduct life cycle

management used to maintain or grow their market share.

What is the Product Development Strategy?

Product Development Strategy means those theDeveloping new products or

modifying existing products so they appear new, and offering those products to

current or new markets. There is nothing simple about the process. It requires keen

attention to competitors and customer needs now and in the future, the ability to

finance prototypes and manufacturing processes, and a creative marketing andcommunications plan.

Given the rapid changes in consumer tastes technology arid competition

companies must develop a steady stream of new products and services A firm can

obtain-new products m two ways. One is through acquisition by buying a whole

company a patent or a license to produce someone elses product .The other as

through new-product development m the companys own research -and-

development department By new products we mean original products product

improvements product modifications and new brands that the firm develops through

its own research-and-development efforts.

When an organization introduces a product into a market they must ask

themselves a number of questions.

1. Who is the product aimed at?

2. What benefit will they expect?

3. How do they plan to position the product within the market?

4. What differential advantage will the product offer over their

competitors?
https://en.wikipedia.org/wiki/Businesshttps://en.wikipedia.org/wiki/Engineeringhttps://en.wikipedia.org/wiki/Product_(business)https://en.wikipedia.org/wiki/Product_designhttps://en.wikipedia.org/wiki/Marketinghttps://en.wikipedia.org/wiki/Product_life_cycle_managementhttps://en.wikipedia.org/wiki/Product_life_cycle_managementhttps://en.wikipedia.org/wiki/Product_life_cycle_managementhttps://en.wikipedia.org/wiki/Product_life_cycle_managementhttps://en.wikipedia.org/wiki/Marketinghttps://en.wikipedia.org/wiki/Product_designhttps://en.wikipedia.org/wiki/Product_(business)https://en.wikipedia.org/wiki/Engineeringhttps://en.wikipedia.org/wiki/Business


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Objectives of Product Development strategies:

Provide a product which supports both Dicom as well as related Non-Dicom data

and is open for expansion to new image modalities and non image formats

Reduce time spent tracking, collating and preparing clinical image data for use in

biomarker development

Allow improved decision making by providing timely access to clinical image data

including viewing of the data

Provide tools for standardizing the handling of imaging and data

Enable secondary analysis of clinical images which will lead to improved clinical

trial and product outcomes

Provide a collaborative environment for internal and external collaborators

Implement a solution that is compliant with regulatory requirements and whichconforms to international data standards

Integration of core data with other systems

Use state-of-the-art technologies providing the required flexibility and cost savings

to the customer.


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Review of Literature

Product strategiesWhen an organization introduces a product into a market they must ask

themselves a number of questions.

Who is the product aimed at?

What benefit will they expect?

How do they plan to position the product within the market?

What differential advantage will the product offer over theircompetitors?

Tailor.P, 7/00, We must remember that Marketing is fundamentally about providing

the correct bundle of benefits to the end user, hence the saying Marketing is not

about providing products or services it is essentially about providing changing

benefits to the changing needs and demands of the customer

Philip Kotler in Principles of Marketing devised a very interesting concept

of benefit building with a product

For a analysis the book of Principles of Marketing by P.Kotler.


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Kotler suggested that a product should be viewed in three

levels.

Level 1: Core Product. What is the core benefit your product offers?.

Customers who purchase a camera are buying more then just a camera they are

purchasing memories.

Level 2Actual Product: All cameras capture memories. The aim is to ensure that your

potential customers purchase your one. The strategy at this level involves

organizations branding, adding features and benefits to ensure that their product

offers a differential advantage from their competitors.

Level 3: Augmented product: What additional non-tangible benefits can you offer?

Competition at this level is based around after sales service,

warranties, delivery and so on. John Lewis a retail departmental store offers free five

year guarantee on purchases of their Television sets, this gives their `customers the


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additional benefit of peace of mind over the five years should their purchase develop

a fault.

Several subsets of product development strategy.

1. Product Development Diversification Strategy

This strategy is employed when a company's existing market is saturated, and

revenues and profits are stagnant or falling. There is little or no opportunity for

growth. A product development diversification strategy takes a company outside its

existing business and a new product is developed for a new market. An example of

this strategy is a company that has sold insurance products and decides to develop

a financial education program aimed at college students. The new product is not

revolutionary as there are other companies producing similar products, but it is new

to the company producing it.

2. Product Modification Strategy

Product modification strategies are generally aimed at existing markets, although aside benefit may be the capturing of new users for the new product. An example of

this strategy is toothpaste. Toothpastes that promote whitening ability or anti-cavity

attributes are built on existing plain toothpastes that only promise clean teeth.

3. Revolutionary Product Development

Revolutionary products are those for which there was no real prior need. Computers

and cell phones are good examples. Before these products appeared on the market,

consumers did not know they needed them. But, the germ of an idea on how to

better communicate resulted in products that have changed the world and havedrastically changed the competitive landscape.


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4. Benchmarking the Process

Whatever strategy is employed, the new product development process must be

carefully thought through. It also requires a series of benchmarks along the way.

These evaluate whether the process should be continued as new product

development is usually expensive and time consuming. For example, if a company is

in the process of developing a new product and a competitor beats that company to

market with a similar new product, the company must make a "go/no go" decision

about its own product development options.

5. Consumers Front And Center

Whatever product development strategy a company selects, consumers need to befront and center and involved in the process from start to finish. Set aside enough

budget for consumer evaluation of the new product at the concept, prototype and the

final product stage. Make sure you not only include those consumers who represent

your primary market, but also those to whom your company might appeal to

secondarily.


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Basic steps of the product development strategy:

1. Idea Generation

Ideas for new products can be obtained from basic research using a SWOT

analysis (Strengths, Weaknesses, Opportunities & Threats). Market and consumer

trends, company's R&Ddepartment, competitors, focus groups, employees,

salespeople, corporate spies, trade shows, or ethnographic discovery methods

(searching for user patterns and habits) may also be used to get an insight into new

product lines or product features. Lots of ideas are generated about the new product. Out of these ideas many are

implemented. The ideas are generated in many forms. Many reasons are

responsible for generation of an idea.

Idea Generation or Brainstorming of new product, service, or store concepts - idea

generation techniques can begin when you have done your OPPORTUNITY

ANALYSIS to support your ideas in the Idea Screening Phase (shown in the next

development step).

2. Idea Screening

The object is to eliminate unsound concepts prior to devoting resources to them.

The screeners should ask several questions:

Will the customer in the target market benefit from the product?

What is the size and growth forecasts of the market segment / target market?

What is the current or expected competitive pressure for the product idea?

What are the industry sales and market trends the product idea is based on?

Is it technically feasible to manufacture the product?

Will the product be profitable when manufactured and delivered to the customer at

the target price?

3. Concept Development and Testing

Develop the marketing and engineering details

Investigate intellectual property issues and search patent databases

Who is the target market and who is the decision maker in the purchasing process?

What product features must the product incorporate?
https://en.wikipedia.org/wiki/SWOT_analysishttps://en.wikipedia.org/wiki/SWOT_analysishttps://en.wikipedia.org/wiki/R%26Dhttps://en.wikipedia.org/wiki/Target_markethttps://en.wikipedia.org/wiki/Intellectual_propertyhttps://en.wikipedia.org/wiki/Patenthttps://en.wikipedia.org/wiki/Patenthttps://en.wikipedia.org/wiki/Intellectual_propertyhttps://en.wikipedia.org/wiki/Target_markethttps://en.wikipedia.org/wiki/R%26Dhttps://en.wikipedia.org/wiki/SWOT_analysishttps://en.wikipedia.org/wiki/SWOT_analysis


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What benefits will the product provide?

How will consumers react to the product?

How will the product be produced most cost effectively?

Prove feasibility through virtual computer aided rendering and rapid prototyping

What will it cost to produce it?

Testing the Concept by asking a number of prospective customers what they think of

the idea - usually via Choice Modelling.

4. Business Analysis

Estimate likely selling price based upon competition and customer feedback

Estimate sales volume based upon size of market and such tools as the Fourt-

Woodlock equation

Estimate profitability and break-even point

5. Test Marketing Produce a physical prototype or mock-up

Test the product (and its packaging) in typical usage situations

Conduct focus group customer interviews or introduce at trade show

Make adjustments where necessary

Produce an initial run of the product and sell it in a test market area to determine

customer acceptance

6. Technical Implementation

New program initiation

Finalize Quality management system

Resource estimation

Requirement publication

Publish technical communications such as data sheets

Engineering operations planning

Department scheduling

Supplier collaboration Logistics plan
https://en.wikipedia.org/wiki/Concept_testinghttps://en.wikipedia.org/wiki/Choice_Modellinghttps://en.wikipedia.org/wiki/Fourt-Woodlock_equationhttps://en.wikipedia.org/wiki/Fourt-Woodlock_equationhttps://en.wikipedia.org/wiki/Packaginghttps://en.wikipedia.org/wiki/Quality_management_systemhttps://en.wikipedia.org/wiki/Factors_of_productionhttps://en.wikipedia.org/wiki/Technical_communicationhttps://en.wikipedia.org/wiki/Data_sheethttps://en.wikipedia.org/wiki/Engineeringhttps://en.wikipedia.org/wiki/Logisticshttps://en.wikipedia.org/wiki/Logisticshttps://en.wikipedia.org/wiki/Engineeringhttps://en.wikipedia.org/wiki/Data_sheethttps://en.wikipedia.org/wiki/Technical_communicationhttps://en.wikipedia.org/wiki/Factors_of_productionhttps://en.wikipedia.org/wiki/Quality_management_systemhttps://en.wikipedia.org/wiki/Packaginghttps://en.wikipedia.org/wiki/Fourt-Woodlock_equationhttps://en.wikipedia.org/wiki/Fourt-Woodlock_equationhttps://en.wikipedia.org/wiki/Choice_Modellinghttps://en.wikipedia.org/wiki/Concept_testing


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Resource plan publication

Program review and monitoring

Contingencies - what-if planning

7. Commercialization (often considered post-NPD)

Launch the product

Produce and place advertisements and otherpromotions

Fill the distribution pipeline with product

Critical path analysis is most useful at this stage

8. New Product Pricing

Impact of new product on the entire product portfolio

Value Analysis (internal & external)

Competition and alternative competitive technologies

Differing value segments (price, value and need)

Product Costs (fixed & variable)

Forecast of unit volumes, revenue, and profit
https://en.wikipedia.org/wiki/Advertisinghttps://en.wikipedia.org/wiki/Promotion_(marketing)https://en.wikipedia.org/wiki/Distribution_(business)https://en.wikipedia.org/wiki/Critical_path_analysishttps://en.wikipedia.org/wiki/Critical_path_analysishttps://en.wikipedia.org/wiki/Distribution_(business)https://en.wikipedia.org/wiki/Promotion_(marketing)https://en.wikipedia.org/wiki/Advertising


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FEW EXAMPLES


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McDonalds in India

The McDonalds Story - GenesisThe story of McDonalds started in 1954, when its founder Raymond Kroc saw a

hamburger stand in San Bernardino, California and envisioned a nationwide fast

food chain. Kroc proved himself as a pioneer who revolutionized the American

restaurant industry. Today McDonalds is the worlds largest fast food chain serving

47 million customers daily. McDonalds is now one of the most valuable brands

globally, worth more than $25 billion. The Golden Arches and its mascot Ronald

McDonald have gained universal recognition. Though the company has roots in the

US, McDonalds today has become an accepted citizen of the world.

McDonalds entered India in 1996. McDonalds India has a joint venture with

Connaught Plaza Restaurants and Hard Castle Restaurants. Connaught Plaza

Restaurants manages operations in North India whereas Hard Castle Restaurants

operates restaurants in Western India. McDonald's Corporation(NYSE: MCD) is the

world's largest chain ofhamburger fast food restaurants, serving around 68

million customers daily in 119 countries. Headquartered in the United States, the

company began in 1940 as a barbecue restaurant operated by Richard and

Maurice McDonald; in 1948 they reorganized their business as a hamburger stand

using production line principles. Businessman Ray Krocjoined the company as a

franchise agent in 1955. He subsequently purchased the chain from the McDonald

brothers and oversaw its worldwide growth.

A McDonald's restaurant is operated by either a franchisee, an affiliate, or the

corporation itself. The corporation's revenues come from the rent, royalties and

fees paid by the franchisees, as well as sales in company-operated restaurants.

McDonald's revenues grew 27 percent over the three years ending in 2007 to $22.8

billion, and 9 percent growth in operating income to $3.9 billion.

McDonald's primarily sells hamburgers, cheeseburgers, chicken, french

fries, breakfast items, soft drinks, milkshakes and desserts. In response to changing
http://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/lcddata.html?ticker=mcdhttp://en.wikipedia.org/wiki/Hamburgerhttp://en.wikipedia.org/wiki/Fast_food_restauranthttp://en.wikipedia.org/wiki/Richard_and_Maurice_McDonaldhttp://en.wikipedia.org/wiki/Richard_and_Maurice_McDonaldhttp://en.wikipedia.org/wiki/Production_linehttp://en.wikipedia.org/wiki/Ray_Krochttp://en.wikipedia.org/wiki/Franchiseehttp://en.wikipedia.org/wiki/Affiliate_(commerce)http://en.wikipedia.org/wiki/Hamburgerhttp://en.wikipedia.org/wiki/Cheeseburgerhttp://en.wikipedia.org/wiki/Chicken_(food)http://en.wikipedia.org/wiki/French_frieshttp://en.wikipedia.org/wiki/French_frieshttp://en.wikipedia.org/wiki/Breakfasthttp://en.wikipedia.org/wiki/Soft_drinkhttp://en.wikipedia.org/wiki/Milkshakehttp://en.wikipedia.org/wiki/Desserthttp://en.wikipedia.org/wiki/Desserthttp://en.wikipedia.org/wiki/Milkshakehttp://en.wikipedia.org/wiki/Soft_drinkhttp://en.wikipedia.org/wiki/Breakfasthttp://en.wikipedia.org/wiki/French_frieshttp://en.wikipedia.org/wiki/French_frieshttp://en.wikipedia.org/wiki/Chicken_(food)http://en.wikipedia.org/wiki/Cheeseburgerhttp://en.wikipedia.org/wiki/Hamburgerhttp://en.wikipedia.org/wiki/Affiliate_(commerce)http://en.wikipedia.org/wiki/Franchiseehttp://en.wikipedia.org/wiki/Ray_Krochttp://en.wikipedia.org/wiki/Production_linehttp://en.wikipedia.org/wiki/Richard_and_Maurice_McDonaldhttp://en.wikipedia.org/wiki/Richard_and_Maurice_McDonaldhttp://en.wikipedia.org/wiki/Fast_food_restauranthttp://en.wikipedia.org/wiki/Hamburgerhttp://www.nyse.com/about/listed/lcddata.html?ticker=mcdhttp://en.wikipedia.org/wiki/New_York_Stock_Exchange


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consumer tastes, the company has expanded its menu to

includesalads, fish, wraps, smoothies and fruit.

McDonalds Strategy:

McDonalds studied the behaviour of the Indian customer and provided a totally

different menu as compared to its International offering.

It dropped ham, beef and mutton burgers from the menu.

India is the only country where McDonalds serve vegetarian menu.

Even the sauces and cheese used in India are mostly vegetarian.

McDonalds came up with chicken, lamb and fish burgers to suite the Indian palatefor non-vegetarian.

McVeggie burger and McAlooTikki for vegetarian.

Target segments are vegetarian people and children, youth and the young urban

family.

Strategy aim at making McDonalds a fun place to eat.

In addition, facilities like Wi-Fi are also provided to attract students to the outlets like

the one at Vile Parle in Mumbai
http://en.wikipedia.org/wiki/Saladhttp://en.wikipedia.org/wiki/Fish_(food)http://en.wikipedia.org/wiki/Wrap_(food)http://en.wikipedia.org/wiki/Smoothieshttp://en.wikipedia.org/wiki/Smoothieshttp://en.wikipedia.org/wiki/Wrap_(food)http://en.wikipedia.org/wiki/Fish_(food)http://en.wikipedia.org/wiki/Salad


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Business Model:

Franchise Model Only 15% of the total number of restaurants are owned by the

Company. The remaining 85% is operated by franchises. The company follows a

comprehensive framework of training and monitoring of its franchises to ensure that

they adhere to the Quality, Service, Cleanliness and Value propositions offered

by the company to its customers.

Product Consistency By developing a sophisticated supplier networked operation

and distribution system, the company has been able to achieve consistent product

taste and quality across geographies.

Act like a retailer and think like a brand McDonalds focuses not only ondelivering sales for the immediate present, but also protecting its long term brand

reputation.


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Volkswagen In India

Volkswagen India Private Limited is a subsidiary ofVolkswagen Group Sales India

Private Limited that assembles, manufactures and distributes Volkswagen vehicles

in India. It was established in 2007. Volkswagen (VW) is a German automobile

manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. Volkswagen is

the original and top-selling marque of the Volkswagen Group, the biggest German

automaker and the second biggest automaker in the world.

Volkswagen has three cars in the top 10 list of best-selling cars of all time compiled

by the website 24/7 Wall St: the Volkswagen Golf, the Volkswagen Beetle, and

the Volkswagen Passat. With these three cars, Volkswagen has the most cars of any

automobile manufacturer in the list that are still being manufactured. Volkswagen

ranks first in spending the most money of any automaker on research and

development.

Volkswagen strategies in India

As a first step, the Volkswagen brand launched the globally successful Passat

Product range extends from low-consumption small cars to luxury class vehicles and

trucks.

Volkswagen Group India, the Indian subsidiary is a part of Volkswagen AG.

It has its headquarters in Pune, Maharashtra (India).

Volkswagen Group is represented by three brands in India: Volkswagen, Audi and

Skoda.
http://en.wikipedia.org/wiki/Subsidiaryhttp://en.wikipedia.org/wiki/Volkswagen_Group_Sales_Indiahttp://en.wikipedia.org/wiki/Volkswagen_Group_Sales_Indiahttp://en.wikipedia.org/wiki/Volkswagenhttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Wolfsburghttp://en.wikipedia.org/wiki/Lower_Saxonyhttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Marquehttp://en.wikipedia.org/wiki/Volkswagen_Grouphttp://en.wikipedia.org/wiki/Volkswagen_Golfhttp://en.wikipedia.org/wiki/Volkswagen_Beetlehttp://en.wikipedia.org/wiki/Volkswagen_Passathttp://en.wikipedia.org/wiki/Volkswagen_Passathttp://en.wikipedia.org/wiki/Volkswagen_Beetlehttp://en.wikipedia.org/wiki/Volkswagen_Golfhttp://en.wikipedia.org/wiki/Volkswagen_Grouphttp://en.wikipedia.org/wiki/Marquehttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Lower_Saxonyhttp://en.wikipedia.org/wiki/Wolfsburghttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Volkswagenhttp://en.wikipedia.org/wiki/Volkswagen_Group_Sales_Indiahttp://en.wikipedia.org/wiki/Volkswagen_Group_Sales_Indiahttp://en.wikipedia.org/wiki/Subsidiary


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Volkswagen is the highest volume brand of VW Group.

Volkswagen presents itself in a variety of segments as a premium manufacturer of

high-volume models.

Aggressive price tags and high-decibel advertisements.

It will be positioned at the upper-end of the country's mid-sized sedan segment.

Volkswagen India has adopted a top-down strategy to arrive at competitive pricing.

Strive for success in terms of profitability, customer satisfaction and quality,

accessing new markets and increasing production output, and attractiveness as an

employer.


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Conclusion

The strategy behind the developing and implementing of product is not an easy thing

most of organization struggling in this part of business. As I mention in my practical

study Procter & gamble says this process the initiative. The whole process is not

based on well idea which can took from research department internal or external

sources of organization. Idea screening is also very important it is essential to pick

the positive values of idea and refine the negative one. Marketing strategy and

business analysis is also significant potion. Without dealing market situation andcompetitor movement it is very dangerous to work some new product development.

Product development is not an easy stage its contain different kind of planning like

resources planning, strategic planning. The resources of any organization play a vital

role in product developing big organization normally rely on there internal resources

which are much benefited for them. If we conceder all the part of test marketing it is

the key of conclusion the organization understand who much they are good in

research or they have good idea of market. Commercialization is also imperative.

High class commercialization can create a huge impact and arrange fine plate foam

for the product.


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References

Tailor.P, 7/00,Marketing is not about providing products or services it is essentially

about providing changing benefits to the changing needs and demands of the

customer

Kotler Philip, Principles of Marketing devised a very interesting concept

ofbenefit building with a product.

Website :

http://learnmarketing.net/product.htm

http://www.businessplans.org/Market.html

http://www.proddev.com/pdf/Succeeding_at_New_Products_the_PG_

Way.pdf

http://www.pg.com


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international product development strategy : few example

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