Steps in the Product Development Process and Potential Challenges

New product development (NPD) is critical for organizational growth and success, from
the tech industry to the food sector to the healthcare industry. NPD involves transforming a new
market opportunity into a commercially viable product through multiple steps and activities to
gain a competitive market advantage (Azanedo et al., 2020). Over the years, due to differences in
industries and organizational needs, researchers have developed multiple “generic” product
development processes, which organizations sometimes tailor to meet their unique needs and
preferences. For instance, convenience products and manufacturers tend to follow the milestone-
based or Stage-Gate models, which ideally comprise idea-scoping, business case development,
product testing, assessment/evaluation, and launch. Other frameworks often take a circular and
holistic approach. For instance, Rozenfeld et al.’s “PD Process Unified Model” consists of three
stages: (1) predevelopment, including evaluation of internal abilities and market needs; (2)
product development, consisting of prototype development, product testing, and refinement; and
(3) post-development, encompassing product launch and appraisal of product performance in the
market (Azanedo et al., 2020). This report summarizes these phases into seven core product
development steps and explains each step’s limitations.
The first step is “idea generation.” In this initial step, new product ideas are generated
and selected via market research, customer feedback, brainstorming sessions, and other
approaches. Limited creativity is one potential challenge in generating cutting-edge ideas,
especially in a particular market or industry. Resources limitation is another likely challenge in
generating new and innovative ideas, especially for smaller businesses that operate within tight
budgets. The process can be resource and time-consuming (Sozo & Ogliari, 2019). Creativity can
also lead to losing focus, as businesses can get sidetracked when generating ideas misaligned

3
with their overall organizational strategies. Evaluation bias and limited diversity can also hamper
creativity.
The second step is “feasibility analysis.” The ideas generated in the first step are assessed
during this step, and their technical and economic feasibility is checked. This entails scrutinizing
the market demand for the new services or products, checking their production costs, and
evaluating the likely challenges and risks associated with their manufacture (Beery & Shabana,
2020). Lack of adequate data can hamper the ability of organizations to comprehensively
perform financial and technical feasibility and viability tests for new products. Changing market
conditions, such as changes in consumer preferences and entry of new competition, can also
affect the capacity to successfully build and deliver new products. Time constraints, limited
resources, and technical issues can impact feasibility analysis.
Step three is “concept development.” After selecting ideas and establishing them as
potentially feasible, they are further developed and modeled into detailed concepts. This entails
defining the services or products’ target markets, benefits, and features (QArea, 2023). The
product development team can also develop mock-ups or prototypes to test the ideas. However,
generating unique and viable concepts takes time and effort. Differentiating new product
concepts from competitors may also present a huge challenge for businesses. Limited resources
can also derail the process, as concept development requires comprehensive market research,
testing, and prototyping. Innovative market blindness, lack of experience, lack of alignment with
business goals and strategies, and the risk of failure can also negatively impact concept
development.
The fourth step is “design and development.” In this step, the “actual” product is
designed and built based on the concepts mapped in the third step. This may entail product

4
prototyping and preliminary tests to check whether or not the product meets the pertinent
requirements and specifications. Potential limitations in this step include difficulty gathering and
documenting requirements, managing complexities (particularly for feature-rick and large
products), maintaining project scope, managing project resources (equipment, funding, and
personnel), dealing with changing product requirements, and ensuring quality.
Step five is “testing and validation.” After designing and confirming the product meets
the requirements and specifications, it must be tested and validated to ensure it meets all quality,
safety, privacy, and functional criteria and standards. In this phase, the product might be
deployed into the real world to check whether it performs as anticipated or projected.
Nonetheless, the timing of the testing and difficulty in identifying all pertinent test cases,
managing the testing process, and ensuring quality and compatibility can present obstacles to the
product testing and validation process.
The next step after testing and validation is “product launch.” Once the product is
deemed functional, safe, and high-performing, it is ready to be introduced into the market
(Campbell et al., 2022). This can be done by potentially creating a market plan, establishing
distribution channels, and several other actions to ensure the product hits the market in a manner
that optimizes and increases its chances of succeeding (QArea, 2023). One challenge a business
might face during a product launch is market competition. A company can only realize during
the launch that other similar and competing products exist in the market; this might impact the
success of the new product. Limited resources and budgets can also affect the product launch
process, as introducing new products is costly and requires careful planning and resource
management. Another challenge is the risk of the new product failing despite an organization’s
concerted effort and intensive resource investment.

5
The final step is “maintenance and improvement.” Regardless of how successfully the
new product is launched into the market, the product development process is a rising spiral that
always continues; it is not a straight line (QArea, 2023). The product must be improved and
maintained over time to ensure it continually meets the needs of customers and the market.
Potential issues organizations may face during this phase include the pain and cost of
maintaining and updating products (especially software products), managing user requests and
feedback, ensuring compatibility and interoperability with emerging and existing technologies,
managing technical debt, ensuring data privacy and security, and maintaining budgets and
resources.

6

References

Azanedo, L., Garcia-Garcia, G., Stone, J., & Rahimifard, S. (2020). An overview of current
challenges in new food product development. Sustainability, 12(8), 1-4.
https://doi.org/10.3390/su12083364
Berry, G., & Shabana, K. M. (2020). Adding a strategic lens to feasibility analysis. New England
Journal of Entrepreneurship, 23(2).
https://www.emerald.com/insight/content/doi/10.1108/NEJE-08-2019-0036/full/html
Campbell, S., Mitchell, M., Christina, J., & Clark, M. (2022). New product development and at-
home medical tests. Health Marketing Quarterly, 39(2), 135-149. doi:
10.1080/07359683.2021.1965823
QArea. (2023, June 29). Product development process: Objectives, challenges, and solutions.
LinkedIn. https://www.linkedin.com/pulse/product-development-process-objectives-
challenges-solutions-qarea
Sozo, V., & Ogliari, A. (2019). Stimulating design team creativity based on emotional values: A
study on idea generation in the early stages of new product development processes.
International Journal of Industrial Ergonomics, 70, 38-50.
https://doi.org/10.1016/j.ergon.2019.01.003