Critical Success Factors And New Product Development Process Of Holden Motors

New Product Development Process

This task requires you to critically evaluate the new product development practice of your own organisation or an organisation that would like to work with. (If you do not have direct access to an organisation you can complete this task using secondary research).

Excellent new product development strategies and planning are very crucial to aid both established and establishing companies to effectively succeed in today’s market (Albinana, 2015). There is a stiff competition among companies, both established and establishing to develop new, high quality and unique products to enable them to retain their customers, to win new prospective customers and to gain mass advantages against their competitors in the market (Aldrich, 2008). Unfortunately, not all the newly developed product end up meeting the objectives; but some end up generating losses to the companies (Assimakopoulos, 2012). The main objective of this report is to distinctively identify and discuss in detail crucial success factors and very important issues involved in new product development for Holden Motors company. Holden company is an established Australian company that is involved in the production of high quality and outstanding cars in the Australian market. This company has successfully launched three models: Commodore, Colorado and Cruze car models (Holden, 2018a). The greatest strength of this company happens to be its main mission is to develop comfortable, appealing, and easy to maintain, and high-speed cars. It is better for this company to continue being ahead of most car manufacturing companies and to highly uplift its product acceptance progressively. Therefore, the management felt the need to outline in detail the Critical success factors which are inclusive of; Product-related factors and market-related factors (Figueiredo, 2012). And other key issues relating to Holden Motors, to ensure effective planning and strategizing for new product development. One of the riskiest process that requires very high investment and much focus in any company according to (Bhuiyan N. , 2011) is the new product development process. That is what informed Holden Motors Company to keenly outline critical success factors and organize them in a well-structured product development process which in effect will significantly reduce the risk of new product development failure.

New Product development process refers to the various tasks, activities, stages, and steps and also decisions which are involved in the development of a fresh commodity (or service) or improving an existing product from initial idea to final product release (Bhuiyan N. , 04 Nov 2011 ).

Factors that Affect New Product Development Framework

In the past few years, new product development worth has increased tremendously (Birkin, 2013). According to (Bruns, 2008)new product development directly affect the future sales and product renewal of a company thereby defining the success or failure of the company; hence it is considered a critical process in the organization (Castellion, 2013).

There are many models that explain step by step development process of a new product by a company. These steps are inclusive of idea screening, concept development and testing, marketing strategies, commercialization and test marketing, business analysis, idea generation, product development (Cooper, 2009). The New Product Development process has been clearly outlined by both literature and companies in terms of four crucial phases, inclusive of: phase one which involves idea generation and conceptual design, phase two which involves Definition and specification, phase three which involves prototype and development and phase four which involves commercialization (Costa, 2013).

 According to (Cousins, 2011), these four phases can be extended into further ten fine steps to include detailed market study, prior screening, initial practical assessment, development of the commodity, trial making, market launch, pre-launch business study, initial market analyzing, product test. Thereby outlining distinctively, the general outline of a very organized new product development process, a key to the company’s accomplishment

An integrated framework has three stages, FANP-QFD, FFMEA and Goal Programming (GP) (Cudney, 2012), as illustrated in figure 1 above. Quality Function Deployment (QFD) is the most preferred methodology of NPD; but in practice, it has some shortcomings. In the first step of designing a fuzzy analytic network process (FANP)-QFD prototype. Fuzzy Interpretive Structural Modelling (FISM) is used to define the significance of the interdependence of factors and the trend that each relationship assumes (Darius, 2017). These outcomes are then applied to construct an FANP-QFD model which includes fuzzy sets notion to factor in the improbability of experts’ opinion, and applies Analytic Network Process (ANP) to make sure that experts’ expressions are steady to consider the interdependence not only the Engineering Characteristics (ECs) but also the Customers Attributes (CAs). In the next stage, Fuzzy Failure Mode & Effects Analysis (FFMEA), which integrates fuzzy sets philosophy into FMEA, dictates the likely shortcomings of the engineering characteristics (ECs) in the NPD process. According to (Samli, 2011) by entering the outcomes of the FANP-QFD and FFMEA, a GP prototype is created in the third step to factor in other purposes in NPD, and the final position of ECs can be determined.

Product-Related Factors

Product Related Factors

New Product Development Speed

Speed to the marketplace is a critical influencer of success (Eduardo Gomes Salgado, 2017). If Holden’s product development process takes 7 years but its competitor, Haval motors, takes 3 years – it is probable that no matter how decent Holden company’s designed products are; they will have been concealed once they get to the marketplace (Holden, 2018b).

Refining the design procedure to make the best use of speed while guarding the customer experience is a delicate matching procedure and it is completely contained in the designer’s remit (Ferguson, 2011). However, the development procedure speed is less probable to be ranging in the strategy team’s capability and their capacity to impact that speed might be negligible at best.

NPD speed affects the profitability of a process

NPD -speed to marketplace may advance a product’s profitability by decreasing the duration of time present to use development funds (Figueiredo, 2012). Usually, smaller lead time might be related to decreased development expenses.

New Product Development Process

Having a flawless design and development process is essential. These processes may be custom-made to fit exact circumstances of a company having a procedure for working that is well understood and settled at by all participants of the product development group more probable to yield a better outcome than those manufactured with no official process (Godin, 2014).

The design players will have more or less contribution to these progressions and have the capacity to effect modifications to procedures once they are not in a position to yield optimal outcomes. According to (Park, 2010) there is very little regulation for the design players over the manner with which other players perform these procedures. When there is a failure to execute from other players makes it be likely to reasonably to admit that failure was totally out of the design players’ control.

Market Orientation

According to (Jerrad, 2018), a market orientation refers to:

“A company philosophy focused on discovering and meeting the needs and desires of its customers through its product mix.”

Despite not having any control over an organizations philosophy, the design team ought to be in a better position to impact it.

Market research and user research

These are two details that aid in the development of very high-quality consumer experience.

Conduction of these research enables the identification of customers need and how to satisfy them.

Knowledge Management

In many companies today; knowledge is highly valued and protected by whoever owns it. Unfortunately, protection of knowledge has made it difficult for knowledge to be applied (Kenneth B. , 2012).

Market-Related Factors

Market research data, for instance, can be extremely useful to a strategy team if they can get access to that information and it is not being kept tightly in the advertising department. Also, customer research information can be more valuable to the advertising team only if they can reach it (Ownes, 2014).

Knowledge management plans will always fall outside of the strategy team’s remit. In spite of this, there is no barrier that prevents the strategy team from supporting an open knowledge management plans or persuading senior administrators to support such kind of structures (Kenneth K. , 2013).

 Technology

• The technology applied to make and distribute the product must be appropriate for the market. Though the strategy does not have a concluding remark in the technology budgets allocation it is more probable that they will be in a position to effect the development players in their preferred technology (Loch, 2008).
• According to (Trott, 2013)the technology which is applied to the development of the new product must be very advanced in terms of current technology available for developing high-quality products. This will enable Holden company to be able to produce very high-quality cars.
• It is evident that, for instance, multi-million Australian dollar hardware & software requirements will cause a product to be inaccessible to the user market but may not be an impossible problem for corporate markets or the government
• Technology ought to be selected with the end-consumer in mind (Ogawa, 2011).

Many scholars have pointed out that Critical Success Factors are very much closely related to the achievement or failure of New Product Development in an organization (Mansor, 2016). They argue that it is among the sections which have the highest capability for advancement (Mu, 2009).According to (Wiley, 2013), for any organization or company to effectively and efficiently develop new quality products which will be highly acceptable by both potential and prospective customers, then the critical success factors must be clearly outlined by the organization before the commencement of the actual new product development. The critical success factors that are most effective for Holden Motors Company can be outlined in four distinct categories.

This is a very important critical success factor for this company and it is inclusive of:

• Full authority for decision making and high management skills. These will enable all the members of the technical team to have a clear guidance during the execution of the critical manufacturing process. Management skill is essential for the production of high-quality cars while minimizing the use of the resources (Castellion, 2013).
• Allow member contributions and participation, when the technical leaders, as well as the management allow members to contribute fully in the various activities in Holden Motors Company, the production level will rise since the employee output will be maximized fully.
• Adoption of appropriate leadership, this is a core especially for the technical team, since any mistake made during the car manufacturing process will weigh heavily on Holden Motors Company. To avoid wastage of resources it is very crucial to have the most effective leadership (Cooper, 2009).
• Motivation of the development team, this is essential as it boosts the morale of the team members, as a result, the employee output will be greatly improved during the process of job execution.
• Proper interpersonal relationship and skills, this will enable cohesion among the team members especially the technical team, with proper interpersonal relationship and skills, the work will be much easier and it will greatly reduce the production time (Cooper, 2009).
• Securing top management for the development team. This is essentially the core reason for the existence of this company, the development team is responsible for, design and implementation of the various types of cars to be produced by Holden Motors Company. It therefore needs a top management for effective execution of its duties.
• Top management support skills, which will enable the systematic flow of operation with the company (Castellion, 2013).

This is a very key critical success factor during the implementation of the initial idea by Holden Company and it is inclusive of:

• Production of documents, documentation of the process especially of the development process is very key during the actual implementation of the process. This will prove very effective to the development team as their work will be greatly enhanced and simplified (Bruns, 2008).
• Overall evaluation of the manufacturing process, which will enable efficient flow in the execution of the whole process. Overall evaluation of manufacturing process is one of initial processes which need an in-depth understanding by all the team members who are passive and actively involved in the development process (Bhuiyan N. , 2011).
• Adds value to the product. Value addition to the final product effectively help the sales persons to bargain more effectively with the potential customers (Castellion, 2013). This will aid the company to attract more customers and compete more efficiently with the established car manufacturing companies in the area.
• Since there are many competing established companies in this area, development, and launching of the product should be within the time frame. This is very key to ensure that the launching and the development time of the various cars is achieved. Failure of doing this may see the company lose their potential customers due to delay. The company may also not be able to regain its former position in the competitive sector (Cooper, 2009).
• The legal standards and compliance, the establishment of the critical decision points, this is important to avoid as much as possible car recall (Bruns, 2008).
• Providing fundamental and strategy guidelines. Since the production process is very detailed it is imperative that both fundamental and strategy guidelines are availed to the development team at the initial stages of development (Albinana, 2015).

The overall integration of a New Product Development in Holden Motors Company is also an important Success Factor and it is inclusive of:

• The development of objective and goals, these are important to every employee in the company, the objective of the company goes beyond car manufacturing and sales, it includes the values that the company has at its core and the key strategies to achieve these core values, objectives and goals.
• The New Product Development and commercial integration, the development team must always harmonize new product development and commercial integration, this should be clearly documented to allow the flow of the development process while making it easy for the cars to be sold at high prices (Ownes, 2014).
• The participation of the key areas of design is equally crucial as they form  to a great extent the perception of the customers concerning the cars, the key areas of design should be critically checked, analyzed and approved (Assimakopoulos, 2012)
• The New Product Development and manufacturing integration, the manufacturing process is a key stage in the new product development process, it is the practical actualization of the documentation process (Bruns, 2008), and having an in-depth understanding of the process will enable the production of very competitive cars by Holden Motors Company(Holden Pressroom, 2016).
• The involvement of key areas in the prototype construction, these comprise of the engine of the car and other key parts, these key areas are given much attention as they will inform the quality of the final product (Jerrad, 2018).
• The participation of the key areas of visibility analysis as clearly outlined by (Wiley, 2013).
• Articulation of the other major ongoing projects, which will ensure an effective transition between projects which are underway and the completed projects. This will enable perfect flow and order of work (Castellion, 2013)in this Company.

The skill level of Holden Motors Company is a more important Critical Success factor as will it determine the quality of the final product to a greater extent, and it is inclusive of:

• Retaining key team member with relevant experience, which will boost the production level, while minimizing employee recruitment cost. According to (Castellion, 2013)the key employee will be instrumental in the manufacture of competitive and high-quality cars.
• A detailed project technical plan, which will outline the various stages of development the technical team will be implementing sequentially, this will also include the various strategies of implementation to be adopted by the technical team during the development process.
• Long-term strategy with efficient innovation focus.

Since the technology is growing more and more expansive every day, the company must embrace innovations which will inform the strategies to be taken in implementing the actual new product development process. According (Assimakopoulos, 2012) to failure to embrace technological innovation fully will cost the company much of its investments inclusive of potential customers, donor, and investors.

• The New Development had key technical skills which will enable it to achieve the detailed objectives as outlined in the documentation. According to (Wiley, 2013)key technical skills essentially is the backbone of the whole process of the new product development
• Commercial, manufacturing, technical assistance had key technical skills which are necessary to smooth new production development process and transition of the various stages of the whole process (Bruns, 2008).

The other key issues in Holden Company which were necessary for the New Product Development are inclusive of:

• Elasticity and receptiveness to modification by all players. This is necessary to enable the implementation of new technological innovations (Aldrich, 2008).
• Applying lessons learnt from the past projects.According to (Albinana, 2015)the lessons learnt in earlier projects is very critical in new process development as it will act as a model for development. It will inform and guide the development team in some crucial stages of new product development.
• An international orientation of global teams and global products.
• The understanding gained via the reassessment efforts(Holden, 2018a; 2018b; 2018c).

The greatest strength of this company which happens to be its main mission is the development of comfortable, appealing, and easy to maintain, and high-speed cars (Holden, 2018a; 2018b; 2018c). Others are inclusive of:

• Highly experienced staff.
• Specialists available for specialized tasks and jobs in the company.
• Proper medical insurance for all employees.
• Very pocket-friendly car prices.
• One-year product warranty.
• Strong financial position.
• Proven expertise in manufacturing, development and search an automobile marketing.
• Technological advancement and continuous product innovation.
• Increase demand for cars from the company.

• High bargaining power of customers.
• High growth rate of automobile industry in the region.
• Cars recalled.
• Poor reputation with investors which can in some way limit the ability of the company to raise capital.
• Insufficient advertisement of the cars in the global market

This report clearly indicates that there is a need for Holden Motors Company to review their agreement with the investors, by doing an audit of the company so as to clear any doubt. This will in effect build a very good reputation with their investors, enable them to attract more investors and most importantly enable them to do production in a larger scale since they will have sufficient funds to fund all their ongoing projects and new projects.

It is also evident that this company should recruit more professional sales agents in order to counter the high bargaining power of the customers. This will enable the company to retain its potential customers while appealing to its prospective customers. It will enable the company to make much profit and therefore enhance large-scale car manufacturing.

Cars recall is one of the most expensive incidents that an automobile company may have to deal with, it is clearly evident from this report that Holden Company sometimes have car recalls, it is therefore very critical that the company improve its testing mechanisms and high more specialist to curb more of these scenarios.

Holden Company should also incorporate the latest technologies available since there is a high growth in the automobile industry in the region. This will boost the competitiveness and will see the company maintain dominance in the automobile industry in the future.

Holden Company should embrace technological advance in the car manufacturing industry, this will come along with much investment in the financially and labor sectors. By embracing new technological advances in the industry, this company will efficiently and effectively manufacture cars that are competitive in the market, this will be very critical to curb high competition in the rapidly growing car manufacturing industry in the area.

Holden Motors should put more efforts in the global advertisement of its manufactured cars other than focusing only in the Australian Market, as this will increase the sales of the company, hence enable it to manufacture more cars. It will enable it to increase its revenue per year.

Conclusion

Market forces have been fluctuating dramatically. Widely held approaches of the year 2010, for instance, cost saving and also quality enhancement, are not enough to succeed in the highly competitive fights of 2018. Organizations that can make and control new markets by coming up with new products are the only ones that can succeed in these battles. New Product Development (NPD) is the procedure with which a company applies its possessions and competences to develop a fresh or an upgraded product. Product development is viewed as “one of the essential processes for success, survival, and renewal of organizations, particularly for firms in either fast-paced or competitive markets”.

The main factors that affect new product development are classified into two groups: Product-related factors that include NPD speed and NPD-process and market-related factors that includes market orientation, knowledge management, and technology. Critical factors that affect the success of new product development of Holden Motors Company includes project leadership skills, high-quality implementation and overall integration of the skill level of the company.

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