NPD Tales

Ideas Thoughts and Comments on Product Development

Cost of Delay?

Delays in product development schedules are almost inevitable.  Unless you avoid technical risk and sandbag your project plans there will invariably be some issue that will result in a potential slippage in your product launch date.

Corrective action might be possible.  You could lose some features, throw some more engineering resources or money at the problem – and the sooner you know about the problem the more chance you have of putting it right.  However it’s important to understand what impact the delay will have on the success of the product so the most appropriate solution can be executed.

If we look at a typical sales curve for a new product, there are a few key parameters that you need to think about.

launch delay factors

1 – How will the delay affect the growth of the sales?  Will the ramp up be slower (or in some instances – like where an earlier entrant has proven the market – quicker)?

2 – What will be the impact on the maximum sales?  Will late entry adversely affect market share (or do you command almost unshakeable customer loyalty)?

3 – When will sales start to decline?  Is this a fixed point in time (where new technology or next generation products take over) or does your product have the same life whenever you launch it?

4 – How quickly will your sales tail off? (This is less important and more difficult to relate to a delay in product launch)

It’s difficult enough to have a strong forecast of your baseline curve, let alone predict the impact of a late product launch.  More accuracy in these figures helps you make better decisions – but even if you can’t put exact figures on your graph, it’s worth asking the questions to understand the shape.

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