08 04 2013 16 22 00 Intensifying competition and the increasing importance of innovation boost the Chapter 6 New Product Design Overview importance of o Product and service development o Protecting developed products and services New products and services o Are reconfigurations of what already exists o Often are extensions of existing platforms o Should be unique in multiple ways o Have increasingly short life cycles The timing price and costs of new products and services are all important Entrepreneurs typically must engage in new product development several times often continually Once a product is a concept it must still be validated through o Technical and market feasibility analysis preliminary research to determine if the product exists and its potential application to solve a o Intellectual property and regulatory requirements determine potential for property rights and plan for patent protection How regulation will problem affect the process Product Development Processes Product development processes are iterative and may not occur sequentially o Multiple versions may be necessary but entrepreneurs should try to minimize reworks and delays o Ideas are discarded or nurtured as the process unfolds o Steps include concept development feasibility analysis prototype development and testing and launch Innovation pipelines can address the uncertainty Innovation pipelines also dilute resources perhaps o Hindering execution and slowing development o Leading to less innovative and reliable product offerings o Limiting market research and increasing failure rates Lack of resources can lead to 5 very common problems o Poor execution o Time to market increases Critical analysis are often not included bottlenecks and backups that cause work to be done in haste and often have to be redone o First to market missed missed opportunities to enter market with no o Projects made simpler dumbing down of projects due to resource o Team morale decline Lack of resources and increasing pressure leads to more team stress and lowers morale Product development is generally challenging time consuming expensive o Due to this most cooperation s have a separate research and development department in order to minimize the negative effects that competition scarcity and frustrating may occur Improving New Product Development Entrepreneurs should establish and adhere to criteria to help determine when to o Being new projects and expand existing ones o End ongoing projects prior to completion Customer feedback o Can increase the likelihood of product success o Help entrepreneurs find unintended uses for designs Outsourcing aspect of product development o Advantages save costs including time and take advantage of other organizations skills o Disadvantages may increase costs including time and expose entrepreneurs ideas to outsiders Entrepreneurs should consider value creation and value capture throughout product development 3 fundamental strategies to enhance success chances o Design right the first time o Shorten time to market o Outsource some product development tasks New product Failure analysis Principle reason to new product failure is lack of good market and industry o Innovators can create value but must be able to CAPTURE value or their returns will be tapped by imitators and others down the value o Despite all the benefits of info and technology new product success is chain still about 60 Intellectual Property Rights Intellectual property right o Legal rights associated with unique resources and capabilities o Reflected in patents trademarks copyrights and trade secrets o Establish exclusivity i e who is allowed to use the resources and capabilities o Critical in modern economies due to importance of intangible assets and the growth in competition Understanding intellectual property rights helps entrepreneurs o Protect their own resources and capabilities Patents Patents and services Criteria for patents o Protect original and useful inventions for a specific time o Utility patents for items producing a tangible outcome o Design patents for items aesthetic features o Business method patents for ways to produce and deliver products o Patents are for new or substantively improved machines circuitry processes goods and chemical compositions o The item must be useful yet not natural novel not infringe on others patents and non obvious Important considerations for patenting decisions o Will the patent outlast the economic life of the invention o What are the downsides of exposing critical knowledge o Is the patent protectable where and at what costs Provisional or Non provisional o Provisional 1 year patent o Non provisional 20 year o Non provisional patents are required for all patents and start from the filing of the patent Trademarks Copyrights and Trade Secrets Trademarks o Protect items that identify a business product or service symbols words designs sounds colors etc o The trademark is valid as long as the item is used commercially and is not part of generic vernacular Copyrights o Protect original creative works visual art music writing computer programs in tangible form o Copyrights exist without registration but registering creates public records and increases protect ability Trade secrets o Often informally protected though some formal protection involving specific parties is possible o May involve items entrepreneurs choose not to or cannot patent or protect via copyrights and trademarks 08 04 2013 16 22 00 Chapter 7 Building Founding Teams most ventures founded by teams o new ventures require many resources o team members can supply resources directly and can affect the venture s access to additional resources o team members can share the intense workload required at startup o different perspectives may promote better decision making the founding team should reflect resource needs often there is a lead entrepreneur with more ownership than other founders have team members compatibility is important but may be difficult to assess before they work together when startup effort is collective with a team that displays diverse capabilities the new venture is more likely to be innovative and carve out a unique niche for itself LOOK AT FIGURE 7 1 5 factors that are significant in team composition o Homophily similarity o Functionality skill diversity o Status expectations cultural bias o Network constraints social contracts o Ecological constraints geographic distribution Consideration for