Product life cycles continue to get shorter, and competition continues to grow more intense in new product development. The fight for shelf space continues to increase. An estimated 46% of company resources devoted to the conception, development and launch of new products goes to projects that are not successful. These products may fail in the marketplace or never make it to the market shelf.

Developing a new product typically takes a minimum of 12 months from idea to launch. Many companies work on a 24-month schedule. Regardless of the timeframe, the process can be daunting.

How does your company manage the new product development process? Is it a seat-of-the-pants approach? Do you continue to make the same mistake over and over again expecting different results? (Just in case you weren’t aware, that is truly the definition of insanity!) Taking a more systematic approach may be just what is needed to increase the return on investment (ROI) for your new product development investment dollars.

Managing this process is a drain on resources and may require a full-time project manager. Because of the huge resource commitment, new product development in some companies has moved to a systemized approach or standardized process.

With a standardized approach, the process, activities and analysis steps force you to stop, review and determine the deliverables. Once the deliverables reach a certain point in the process, the outputs are determined to be valid or invalid. If valid results or outputs are achieved, the next group of deliverables is set.

If the outputs are deemed invalid, the project will be reworked or the project, as currently defined, will stop. Stopping it allows you to evaluate while forcing all members of your cross-functional team to work to identify problems, issues and concerns. This analysis step forces a decision point and serves as a go/kill step.

Many companies have put together their own new product development processes, and others purchase their systems. Either way, having a strategic approach in place helps you efficiently allocate and manage corporate resources while accelerating speed to market.

Well it sounds like a perfect system, doesn’t it? It should be easy to sell within your company, right? Hold on; it might not be as easy as it appears. The new process represents change — not only in process but possibly in corporate culture. In either case, change can be difficult or even disabling for some individuals. Companies may prefer to continue in the “we have always done it that way” mode. The new approach requires discipline, teamwork and sometimes admitting that the project needs to be killed. When team members have a vested interest in the project or they personally like the new product idea, it can be difficult to admit that the project is a waste of time, money and resources.

It is my guess that many of you expected me to focus on cutting ingredient and production costs. While that is also an important aspect of improving margins and profitability, it should be secondary to managing the new product development process. Innovation is key to the long-term success of consumer package goods companies. Companies that fail to innovate face a bleak future.

I hope that by reading this article, if you haven’t already done so, you will work to incorporate a systematic approach to new product development that will allow you to increase the ROI on your innovation budget with more successful new product introductions.

This story is sponsored by POWER Engineers, which has one of the most comprehensive teams of engineers and specialists serving the baking and snack industry. As an extension of its clients' engineering teams, the company provides program management, integrated solutions and full facility design for the baking and snack industry. Learn more at www.powereng.com/food.