This chapter looks at product or services development with an obvious linkage to the other chapters of business planning and supply chain management. Product development can take either one of two approaches: it may be a modification to an existing product with a focus on market sustainment, or it may produce market disruption by offering new products or significantly enhanced features such as simplicity, ease to use, lower costs and so on. After some general considerations, both of these approaches to product development are explored in further detail. Whilst the focus is generally on physical products, many of the models and narrative can be equally applied to the provision of services.
A good start to understanding product development is first to consider the three traditional “classes of production”, these being:
• Primary production which is the earliest stage in the production process such as that witnessed in mining, farming, oil extraction, tree-felling, etc.
• Secondary production involves converting the primary production raw materials into finished, or part-finished, goods either through constructing, manufacturing or other forms of processing.
• Tertiary production describes the activities of the services sector of the economy with examples such as retail, insurance, banking and direct services to ...