Strategic planning is the foundation for new Product Development and Product Management.
During the strategic planning phase, an organization’s capabilities, relevant technologies and market opportunities are taken into consideration in order to create and deliver value to the customer.
The purpose of new product strategy is to:
- Set new product objectives (sale, profit, contribution, market share….)
- Understand the contribution of new product development within the company’s wider goals
- Define the technologies, markets and product scope
A Product Innovation Charter (PIC) can be used to help guide this process.A Product Innovation Charter (PIC) can be used to help guide the process of strategic planning for new Product development and Product Management. Click To Tweet
In 1980, Merle Crawford identified a set of policies, goals, objectives and restrictions across organizations and called it the Product Innovation Charter (PIC). A PIC is a written document, prepared by senior management to chart the company’s new product strategy and to guide the product team. A comprehensive and detailed PIC provides more direction and focus to the team and ultimately, better performance of the company’s new products.
According to a 2007 PDMA (Product Development Management Association) study:
- 29% of firms have a formal PIC and;
- 75% of the firms have a new product policy (some derivation of PIC).
A typical PIC may contain:
The background of a PIC includes key points from a PEST analysis (Political, Economic, Social, Technology) or situation analysis. Questions addressed in this section of a PIC may include:
- What is the business about?
- Why has this strategy been developed?
The focus of a PIC includes the company’s core competencies and how best to use the company’s core competencies to derive value.
Questions addressed at this stage of a PIC may include:
- What are your company’s core competencies?
- What is your company’s competitive advantage and the value that your company can bring to the target market?
- What are your advantages in relation to your target market’s needs, wants, and consumption trends?
- What are your company’s marketing capabilities?
3. Goals and Objectives
The goals and objectives section describes the company’s short-term and long-term objectives of the new product. The goals and objectives should be measurable.
The guidelines component of the PIC is essentially a road map written by the Product Manager for the entire organization. It includes the time and entry to market, costs, product quality and so forth.
Having a PIC doesn’t necessarily guarantee success but it’s nevertheless important to chart your product’s entrance into the marketplace.