Product Development & Business Case

Stage 3 – Development 

The development phase concurrently involves detailed product testing, the development of detailed marketing and operational plans and the update of financial plans.  In relation to the product development, testing and experimentation ensures the product definition outcomes are achieved.

Areas of consideration include:

  • Entrepreneurship.
  • Motivation, do you have the making of an entrepreneur?
  • Developing your idea.
  • Financing and financial models.
  • Early seed capital, own funds, family or friends.
  • Develop final prototype product/service (mass producible / sellable / scalable).
  • Design for manufacturing engineering.
  • Consumer ready product / service / software.
  • IP.
  • Finalising your protection strategy.
  • Trade secrets.
  • Copyright.
  • Patents.
  • Trademarks.
  • Commercial structure – what will the commercial structure be?

Commercialisation Options

There are several different options for commercialising an opportunity. These can vary from complete sale of the IP to the use of third parties or complete in-house commercialisation. The method of choice will vary depending on the resources and capabilities of the business.

When reviewing IP, or a business opportunity, you should consider all commercialisation options. Each option will result in different levels of risk, profit, control and management for the business. Generally, the more input of resources and finances that an organisation requires for commercialisation, the greater the risk. However, it also usually means greater control and increased returns if successful.

The four major Commercialisation Options available include:

  • Starting your own business.
  • Licensing.
  • Assignment of Intellectual Property (IP).
  • Collaborative ventures / Strategic alliances.

Starting a New Business

If, after careful consideration of the commercialisation options available to you, your decision of to start your own business, the Commercialisation Blueprint will provide useful and practical information to guide you through the various stages and steps that require careful consideration before investing any time or money into starting a new business.  The Blueprint helps you identify key areas that may need to be addressed to enable you to make better decisions and maximise return on investment.

When you start a business there are a vast number of key decisions that need to be made about a range of issues including:

  • The structure of your business.
  • The business plan.
  • How to secure necessary funds.
  • The marketing strategy.
  • Business model.
  • Operational needs.
  • Financial considerations.

The primary goal at this early stage of your business is deciding what is needed to ensure that your business will be able to make a profit and be sustainable.

The following is a practicle guide to achieve this:

Set yourself some goals, actions and deliverables:

Goals – These should communicate the desired outcomes you are trying to achieve at this stage

  • Qualify product/service through prototype development and testing.
  • Refine specifications or design inputs.
  • Identify issues related to scale up manufacture or delivery.
  • Identify service strategy.
  • Assess trial feedback.
  • Identify and understand all potential financial, legal and regulatory issues.
  • Finalise IP protection strategy

Actions – What needs to be done to realise your goals

Product and IP

  • Develop a prototype in accordance with design and technical specifications and cost goals.
  • Document and analyse potential scale up issues.
  • Confirm risk analysis.
  • Confirm SWOT analysis.
  • Identify and understand all potential financial, legal and regulatory issues.
  • Review IP protection strategy.

Sales and Marketing

  • Develop user materials including instructions for use or full user manuals.
  • Revise Marketing Plan.
  • Prepare Sales and Distribution Plan.
  • Prepare Promotion Plan.

Manufacturing

  • Revise Manufacturing Plan.
  • Identify manufacturing partners.
  • Revise suppliers.

Quality

  • Develop a test plan and test prototype under simulated end user conditions and ensure product service meets design and technical specifications and end user requirements. Feedback results into specification review.
  • Develop test plans and organise trials. Assess trial feedback and incorporate results into specification and technical review.
  • Prepare Quality Plan.
  • Revise packaging.

Business and Finance

  • Assess Commercialisation Options (refer to Choosing a Commercialisation Method Template).
  • Develop an exit strategy.
  • Revise Business Plan.

Evaluation

  • Business Feasibility (early stage, considering commercial options).
  • Evaluate Opportunity (existing organisation).

Deliverables – Outcomes of your actions

Product and IP

  • Documented test results and feedback incorporated into refined design and technical specifications.
  • Output Demonstrates scalability for commercial release.
  • Updated Risk Analysis.
  • Updated SWOT analysis.
  • IP protection strategy finalised.

Sales and Marketing

  • Draft user instructions leaflet or user manual.
  • Updated Marketing Plan.
  • Detailed Sales and Distribution Plan.
  • Detailed Promotions Plan.

Manufacturing

  • Manufacturing agreements in place.
  • Define safety and regulatory requirements.
  • Confirm suppliers.

Quality

  • Draft Quality Plan.
  • Test Plans and trials organised (agreements in place), trial results analysed and feedback documented and incorporated into technical review process.
  • Packaging tested documented and packaging confirmed.

Business and Finance

  • Commercialisation Options report.
  • Exit strategy.
  • Revised Business Plan.

Evaluation

  • Business Feasibility Report.

Decision: Progress idea, further research or stop.

Tips

Below are some tips to help keep you on track:

  • Get out there and talk to the users.
  • Keep your spending to a minimum.
  • Product iteration is important, identify opportunities for improvement.
  • Get the product to market in a reasonable time-frame, it doesn’t need to be perfect.  Iterations can be made post launch.  Just ensure the product stands up to reliability testing and can gain confidence in the market and meet the market need.  Many improvements can be made quickly post launch.
  • Technology is only valuable if someone wants to buy it, and large companies won’t absorb extra costs for increased functionality unless the consumer absolutely demands it.
  • Explore your options regarding manufacture, by optimising the design and outsourcing manufacturing, you may be able to significantly reduce costs, enabling you to successfully enter the market.