The PDMA Handbook of Innovation and New Product Development, 4th Edition

CHAPTER THIRTEEN MANAGING THE SUPPLY CHAIN IMPLICATIONS OF LAUNCH

C. Anthony Di Benedetto and Roger J. Calantone

13.1 Introduction

The launch activity for new consumer products is a risky endeavor and usually is the most expensive stage in the new product development process. Typically, launch involves the efforts of brand management and the supply chain (logistics and operations). Accordingly, launch represents a major stumbling block in coordinating brand management, logistics, and operations, and the financial amounts at stake are often a critical factor in determining the success of new consumer products. A particular launch consideration is the clean handoff from the development team to the team that will manage the product during and following launch. This handoff provides considerable opportunity to turn a successful product development into a commercial failure. By handoff we mean that tactical decisions made at launch must align with the strategy that justified the product’s development. For example, distribution logistics must be in place; a reliable demand forecast for the new product must be made to guide manufacturing ramp-up; and promotional activities aimed at both the consumer and the trade must be appropriately timed. A large electronics manufacturer, for example, may run a marketing/logistics process in parallel with their innovation stage-gate process to ensure ...