Page 91 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Customer Relationship Management

Notes rises, traditional innovation models are unable to quickly and accurately satisfy the needs of
customers. In order to reduce risks and accelerate the speed of new product/service development,
customers’ involvement has become one of the most important issues concerning new product/
service development.

New Product/Service Development

Facing the fierce competition from domestic as well as foreign rivals, companies can only beat
their competitors through rapid introducing new products/services which could meet the
changing needs of customers. However, developing a new product/service often takes a very
long time; in order to reduce risks, scholars start study the new product/service development
process to enhance the efficiency and effectiveness of this process.
In the late 80s, as the importance of the manufacturing sector has become well recognized,
scholars are focused on the development of new products. They proposed a stage-gate model to
efficiently manage different stages of the new product development process.

As the service industry has played a crucial role in the world economy, academics started to pay
more attention on new service development however, most of the new service development
models are based on new product development. Apart from incorporating the concept of project
management, the overlapped activities during the development process, and the information
sharing inside and outside the company, scholars and practitioners have yet not find an easier
way to facilitate the process and improve the effectiveness as well as efficiency of new product/
service development. However, studies approved that interacting with different kinds of
customers and inviting them to participate in the development process might significantly
improve the performance of new product/service development.
Customer involvement is defined here as those processes, deeds, and interactions where a
product or service provider collaborates with current customers at the program, project, and/or
stage level of innovation, to anticipate customer’s latent needs and develop new product or
service accordingly.

Figure 4.4: Elements of Customer Involvement in Product and Service Development

Source: https://www.google.co.in/.3.0...0.0...1ac.1.7.img.lht30OO7YYM

86 LOVELY PROFESSIONAL UNIVERSITY