Product and Service Development — Overviews and Resources
As written in Wikipedia,
in product development, “The product can be tangible (something physical
which one can touch) or intangible (like a service, experience, or belief),
though sometimes services and other processes are distinguished from ‘products’.”
Although there are additional differences between the nature of a product and
service (as explained below), for the sake of expediency, this topic will use
the term “products” to refer to both. Also, this topic focuses primarily
on the development of a product, rather than primarily on its ongoing management.
Nonprofit organizations often provide services in the form of “programs”,
rather than “products” — although the services from the programs
are certainly “products or services” to groups of clients. Thus, nonprofit
readers might more readily relate to the following guide.
Guidelines for Nonprofit Program Design and Marketing
A nonprofit that is developing a tangible product to generate a profit for
the organization (referred to as a Social
Enterprise) might benefit from reading the content in this topic about product
Sections of This Topic Include
Introduction to Product Development
Developing Your Product
Phase 1: Generating Ideas
—Many Sources of Ideas
—Protect Your Ideas
Phase 2: Researching
—Is Idea Feasible? Viable?
—Need an Investor or Funder for Your Idea?
Phase 3: Testing
—What Will Customers Think of Your Ideas?
—How to Get Feedback From Customers
Phase 4: Analyzing
—What Have You Learned So Far?
—What About Design Specifications? Project Planning?
Phase 5: Rolling Out
—Developing Your Marketing Plan
—Why Should Customers Buy From You?
—What Will You Convey to Your Customers?
Additional Perspectives on Product Development
Learn More in the Library’s Blogs Related to Entrepreneurship — Product and Service
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Basically, a product is a tangible offering to a customer, whereas a service
is an intangible offering. The former is usually a one-time exchange for value.
In contrast, a service usually involves a longer period of time. The value of
a product is inherent in the tangible offering itself, for example, in the can
of paint or pair of pants. In contrast, the value of a service often comes from
the eventual benefit that the customer perceives from the time while using the
service. In addition, the customer often judges the value of a service based
on the quality of the relationship between the provider and the customer while
using the service. To understand more differences, see
Between Product and Service
Key Differences Between Services and Products
website defines product development as “The overall process of strategy,
organization, concept generation, product and marketing plan creation and evaluation,
and commercialization of a new product.” That site also suggests eight
situations when product development is needed. Also see
is Product Development?
Is the Difference Between Product Management, Product Marketing, Product Development
and Program Management?
Therefore, product development includes a wide range of activities, ranging
from the time that there is a new idea for a product and up to the ongoing management
activities to produce and provide the product to customers. (The latter is referred
to by the phrase “product management.”) How a product is developed
depends very much on the nature of the organization and its products, for example,
retail, manufacturing or wholesale. It also depends on the culture of the organization,
for example, whether products are developed intentionally and explicitly or
unintentionally and implicitly.
Products, just like people and organizations, go through various phases in
their lives (Basic
Overview of Life Cycles in Organizations). Different experts suggest different
stages in the life cycle and give them different names. It helps a great deal
to know about different phases in the life of an organization or product because
it suggests the types of activities that are typically seen in each phase, as
well as what activities to do to evolve to the next phase.
For example, the following article suggests Development, Introduction, Growth,
Maturity and Decline. Product development occurs primarily during the first
phase. The typical final phase of product development is when it is launched
or promoted to potential clients. That final phase could be included in the
Introduction phase of the product’s life cycle.
Life Cycle & Product Development Cycle
There are at least five different common approaches to developing a new product.
Some approaches seem to start out slow and soon stop altogether. Other approaches
start out fast and then end in a flurry of confusion. Still, other approaches
start out carefully and go on to make a huge difference for their customers.
The approaches include:
- “Build It and They Will Come” Approach
- Seat-of-the-Pants Approach
- Incremental Planning Approach
- Business Planning Approach
- Business Development Approach
Typical Phases in Carefully Developing Products
There are a variety of models, or sequences of phases, that people use to develop
a product or service, including:
- Fuzzy front-end, including often informal sharing and clarification of ideas
for the new product.
- Product design, including activities that result in a detailed set of specifications
for the product’s design.
- Product implementation, including refining the specifications by testing
them, often through development and use of a sample (or prototype) of the
- Fuzzy back-end, including producing the new product and rolling it out to
The following article suggests five phases similar to the above in product
development, including the following.
- Idea generation (creativity
and innovation, brainstorming,
- Research and development (market
- Testing (focus
- Analysis (feedback,
solving and decision making, financial
- Rollout (marketing,
The following content in this topic is according to this five-phase model,
also listed above.
Phases of New Product Development
These articles suggest various phases, too.
Step Process Perfects New Product Development
Product Development: The
7 Steps of Effective Product Development
Develop a New Product (From Concept to Market) (6 steps)
It’s one thing to have a good idea for a new product or service, but it’s another
thing to actually develop and provide it — that’s the essence of entrepreneurship.
The following link is to a resource that will guide you through complete consideration
of whether you’re really ready for entrepreneurship or not.
— Are You Really Ready to Start a New Venture?
Many of the activities in product development are also activities in the overall
process of marketing.
Basics of Marketing
(from idea to evaluating to developing to producing)
in Organizations (everything has a life cycle, including products)
If the reader is highly motivated at this point, then he or she might scan
the information about the basics of business planning. Business planning is
usually conducted when starting a new organization or a new major venture, for
example, new product, service or program. Essentially, a business plan is a
combination of a marketing plan, strategic plan, operational/management plan
and a financial plan. Funders or investors usually require a business plan.
Far more important than the plan document, is the planning process itself.
of Business Planning
Planning New Business in Addition to Product?
If you are planning to start a new for-profit business or nonprofit business
around your idea for a new product or service, then you will benefit from reading
information in the topics Starting a For-Profit Business or Starting a Nonprofit Organization. Note that information
in these two topics will guide you through assessing the feasibility of your
new business — information in the rest of this topic about product management
will include assessing the feasibility of developing a new product. It’s likely
that if you are starting a new business, you will eventually need information
in the rest of this topic about product development.
Phase 1 — Generating Ideas
At this stage, someone has an idea for a new product or service. Ideas can
come from many sources, for example:
- Complaints from current customers (see Customer Service and Customer Satisfaction).
- Requests for Proposals from large businesses and government agencies.
- Modifications to current products (see Innovation).
- Suggestions from employees, customers and suppliers (see Creative Thinking).
- You can learn a lot from analyzing your competitors (see Competitor
It’s likely that someone else will think your idea is a good one, too! Therefore,
it’s important to protect your idea as much as possible, for example, by getting
copyrights, trademarks or patents. See U.S. Intellectual Property Law
You might also want to minimize the chance of an employee taking the idea and
starting their own business. See
Phase 2 — Researching
Just because it seems like a great idea doesn’t mean that it can become a product.
A feasible product is one that can be realistically developed and delivered
to meet the needs of potential clients. A viable product is one that needs to
be profitable (or, in the case of a nonprofit, at least sustainable), including
being producible and marketable.
Also, the product should be related to the purpose, or mission, of your business.
Businesses can go bankrupt by trying to be too many things to too many customers,
rather than doing a few things very well. You might use guidelines from these
For-profits that need investment money will benefit from the
Nonprofits that need funding will benefit from the following
As noted above, you very well may need a business plan to convince the investor
or funder that your idea is viable to become or product or service. See Basics of Business Planning
Phase 3 – Testing
Now is the time to get input from those who would be using the new product.
When products have very low sales, it is often because the developers had more
faith in their own preferences than in those of the customers.
But before you can get input from the potential customers, think about who
those groups (or target markets) might be? Thank about:
- Where did you get the ideas to develop the products in the first place?
- Who is using products that seem similar to those that you are thinking about
- What have you been hearing and reading about regarding strong unmet needs
among various groups of people? What might meet those needs? Are those needs
within the scope of your organization’s mission and capabilities.
A powerful way to get very useful feedback, especially regarding ideas to improve
your new product, is to use design thinking. It is unique in that it is a hands-on
approach that deeply involves the people (the users) who are affected by their
problem or unmet need.
At this point, you’ve concluded that your idea can become a viable product.
Now you’re faced with actually building the product itself. The particular process
you use to build your product or service depend very much on the nature of the
product or service. The following links might help you as you develop your unique
process to build your product.
What Is Your Product Saying to Consumers?
is a Bug List?
next for design?
Now’s the time to write an overall, or functional, description of your new
product. The more detailed description comes during the next phase.
Are Functional Specifications
Now is a good time to consider:
- What did you hear from potential customers?
- What changes are needed to your original design?
- How will you make them, who will do it and by when?
- What will the changes cost to implement? To continue to produce?
- Who will be your primary target markets? What are the primary needs and
wants of that target market?
- What is the likely cost to develop and produce the product?
- So what pricing structure should you use?
- Who will be the primary competitors of your final product?
These questions are often answered when developing a business plan for your
All About Business
You certainly should develop and implement of a project plan to build your
(method to carefully plan and track development of the product/service)
Businesses are coming to learn that it’s never too early to integrate principles
of quality management into the design and development of products and services.
Basics About Quality
What about a final written specification that employees can use to develop
and provide the product?
a Requirements Document
Technical Writing Skills
Phase 5 — Rolling Out
Now you are ready to get the word out about your new product. Especially for
a new product, it is very important to do that very carefully and systematically.
It is not a time to start bursting our whatever positive messages that you have
to convey to anyone who will listen. That would be a major mistake.
What are the unique features and benefits of the new product? Why should customers
buy from you, rather than from competitors? The answers to this questions are
your positioning statement.
Unique Selling Position — Your Best “Elevator” Pitch
Draft a communications plan with answers to:
- What are the different target markets that you aim to serve?
- What do you want each to believe about your new product?
- How does each market prefer to get communications, for example, radio, television,
postal mail, phone calls, emails or flyers?
- So what messages do you want to convey to each and how?
- Who will do that and by when?
There are numerous methods to get the word out.
Methods of Advertising and Promotion (Methods of External Communications)
Do not forget about the power of using social media.
Intellectual Discipline in Product Development
a Strategic Product Plan
Product Development Stages
the Most out of Your Product Development Process
Insights for Improving Product Development Cycle Success
Lean Product Lifecycle
Cycle of Mistrust in New Products
Overview of the New-Product Development Process
Product Development Time to Improve the Development Process
Development Cycle Fundamentals
For the Category of Product Development:
To round out your knowledge of this Library topic, you may
want to review some related topics, available from the link below.
Each of the related topics includes free, online resources.
Also, scan the Recommended Books listed below. They have been
selected for their relevance and highly practical nature.