New Product Development and Business Development are impressive titles that are often heard in business organizations. However, not everyone understands and knows these concepts well. So, what are Product Development and Business Development? How are they different? Let’s find out.
What is New Product Development?
New Product Development is the activity to bring out a new product in the market. It means this product has never been manufactured in this company.
For example: company A trades in air purifier about 5 year. However,
company A want to expand market so that it have to manufacture new products. It can be dehumidifier, humidifier or combination product.
“New product development begins with realizing market opportunities for products, ending with the production, sale and distribution of products to customers.”
With this definition, it is clear that the scope of New Product Development is very wide. It almost covers the entire life cycle of the product, not just limited to the stages of drawing, calculating or testing.
Therefore, an engineer works in the Product Development department must not only have in-depth technical knowledge but also have diverse knowledge along with effective working skills and methods.
In industrial production, profession product development process will help company make new products response standard and quality.
With 14 years of experience in making products, cooperating with businesses, MES LAB develops a complete Product Development process, based on the “Design Thinking” rule. It consists of the following steps:
This philosophy has the following 4 characteristics:
- Centered Human centered: User centered
- Collaborative: Collaborate closely in the design process
- Experimental: Promote prototyping and testing
- Optimistic: Every problem can find a solution
What is Business Development?
In the simplest terms, Business Development can be summarized as the ideas, initiatives and activities aimed towards making a business better. This includes increasing revenues, growth in terms of business expansion, increasing profitability by building strategic partnerships, and making strategic business decisions.
Business development based on 3 main components:
- Customers: Research on customers’ behaviors, regions, etc.From that, they can find new customers and create more value for existing customers.
- Market: Understanding and assessing the market, analyzing competitors, etc. grasping the latest market trends
- Relationships: Building and leveraging relationships based on trust to facilitate opportunities.
Business Development activities extend across different departments, including sales, marketing, project management, product management and vendor management. Networking, negotiations, partnerships, and cost-savings efforts are also involved. All of these different departments and activities are driven by and aligned to the business development goals.
How are they different?
|Product Development||Business Development|
|Product development is the |
creation of new products to provide consumers and markets so that enterprise can earn profits through sales and business activities
|Business Development can be summarized as the ideas, initiatives and activities aimed towards making a business better|
|The goal is to create new products||The purpose is to develop and expand business|
|Short-term nature||Long-term nature|
|Who responsible are the engineers||Business developer with expertise in economics will perform.|
What is the relationship between New Product Development and Business Development?
Although there are a few differences, however, New Product Development and Business Development also have some similarities such as:
Firstly, both of these activities are creative.
Innovation in New Product Development is expressed through product ideas. This idea must be unique, new, hard to copy, highly feasible, etc. From that, it is able to design and develop ideas into concepts and finished products.
Simply ! No idea, No product.
For Business Development, the idea is even more important. Ideas are expressed through business development strategies. Because of its long-term nature. A good business strategy will create a foundation for businesses to grow and expand their business in a few decades.
Secondly, both of them are indirectly profitable for the company
After, the product is manufactured. Selling product need to go through the sales and marketing department – the department directly working with customers.
Besides, Business Development aims to expand and develop the market in order to find potential market sources for products. After that, sales and marketing department will sell products to bring direct profits to the company.
In conclusion, they have reciprocal support.
In the course of product development, one important step is Define. This activity aims to devise strategies for the product. That is, the product will be sold to the audience, price, market, etc.
At the same time, good products also bring high opportunities to expand and develop business markets.