It's no accident that successful companies rely on innovation to stay ahead. In
today’s global competitive market, executives expect new product revenue to be about
30-35 percent of sales. The problem for growth seeking managers, of course, is that
the exciting growth markets of tomorrow are small today. From the perspective of
a firm seeking successful new product innovation, there are two basic areas of innovation:
- Meeting unmet market needs of customers
- Meeting existing needs better or more economically
Lucintel works with clients to identify new growth opportunities, and overcome the
challenges to making their innovation opportunities feasible and profitable. Our
solutions radically improve the success of new product innovation, while meeting
technical, financial and time-to-market requirements.
Product innovation is best accomplished by determining the critical requirements
for success with sufficient depth and precision to guide development activities
before major expenditures is made on design, manufacturing facilities, marketing
and distribution efforts.
To launch a successful product innovation, Lucintel has developed
a model where it performs four areas of organized checklist or framework to ensure
that all areas are covered. Lucintel model is termed as “NTVB” analysis. The technique
is market driven and ensures high return on investment (ROI) and success. NTVB analysis
is based on following 4 steps.
- Needs Analysis
- Trend Analysis
- Value Analysis
- Benefits Analysis
In each of the above four areas, Lucintel answers many questions as follows to ensure
highest chance of success.
Needs Analysis: The focus of this study is to understand
unmet or existing market needs. Research would proceed from need identification
to in-depth understanding of needs, why they are important, and documentation of
technical, market, economic and competitive factors affecting possible solutions.
The key objectives in this section are as follows.
- Market requirements: Why would users accept the innovation? Why
would they change from current practice? What amount of improvement over current
practice would attract customers to use the innovation? What would be the expected
life of the innovation? Who are potential users?
- Functional (product) requirements: Technical and physical requirements
of the product such as weight / sq.ft., flexibility, performance, properties, etc.
- Economic requirements: Life cycle cost of the innovation –
expected savings in material cost, processing, use, maintenance, replacement - and
expected payoff. Cost structure of current practice vs. proposed innovation, including
margin estimates.
- Competitive requirements: What competitors have similar or related
innovations or capabilities and what is their potential threat to this innovation?
- Trend Analysis: Investigate trends in innovation along the unmet
and / or met needs. What industry players are doing to meet the needs? Trends in
materials development in terms of performance and price. Is there any known technology
already there to meet the need? What market trends would support development and
acceptance of solutions? Which trends would hinder usefulness and acceptance? Does
a window of opportunity exist, and must a solution be found and implemented in a
given time frame?
As shown in above chart, performance over time generally improves via sustained
innovation by industry suppliers to meet customers’ ever-increasing needs or wants.
When there is a gap between customer needs and actual performance delivered, there
is an opportunity for a new innovation to meet those needs, rather than waiting
for industry players to meet the performance desired. By introducing an improved
solution, a new player may gain entry to a market by “filling the gap” in performance
to satisfy the unmet customer needs. In the chart, performance shown in Y axis could
be improvement in cost saving, or flexural strength or surface finish quality.
Value Analysis: Estimate value ($) and profitability
created by the innovation along the value chain (from end customer to fabricator
/ molder to material supplier). Perform detailed cost analysis over the period of
product life – expected lifetime cost & value of the innovation versus
current practice.
Benefits of Innovation: Identify whether and why the
new innovation is better than existing technologies and solutions available in the
market. Determine critical factors and criteria that must be met to consider the
innovation a success.