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Why New Products Fail

In: Strategic New Product Development for the Global Economy

Author

Listed:
  • Toyohiro Kono
  • Leonard Lynn

Abstract

Often a new product development (NPD) process does not result in a new product. This may mean that the NPD process should be considered a failure. The company may desperately need the new product. But sometimes a NPD process can be considered successful because it prevents a money-losing product from being launched. Discontinuing development at an early stage may be the right decision. It may keep the company from spending a lot of money on a product that has poor prospects. In any case, no one should expect that every NPD process, or even most of them, will result in a product. To take an extreme example, the pharmaceutical industry screens an average of 10,000 molecules to find 250 suitable for preclinical testing. Of the 250 undergoing testing, only ten make it through to clinical trials, and only one is approved to go on the market. An effective NPD process is not one that makes a new product out of each new idea, but rather one that efficiently selects and develops the ideas that result in products that best fit the needs of the corporation and its customers.

Suggested Citation

  • Toyohiro Kono & Leonard Lynn, 2007. "Why New Products Fail," Palgrave Macmillan Books, in: Strategic New Product Development for the Global Economy, chapter 2, pages 19-45, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-59938-3_2
    DOI: 10.1057/9780230599383_2
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