Your business has a formal process for implementing improvements and cost reductions in existing products or services
 
Current products and services should be regularly reviewed by senior managers to ensure that they:
o      Comply with current legislation
o      Have embedded in them the technical features that customers expect, and
o      Are attractive in comparison with competitors’ offerings
Key Issues
·         Many factors may alert you to the need for improvement:
o      Requests and/or feedback from customers
o      Changes in national and international legislation/standards
o      Cost escalation for base materials and components
o      Suppliers offering alternative, more advanced products
o      Pricing studies on local markets/competitors
o      Market surveys on technical features and/or customer expectation
o      Pricing pressures from competitors/decline in orders
o      Management initiative to reduce cost/improve margins
·         Products should be updated on a planned basis taking full account of cost models, customers key buying factors and the value you provide
·         A useful approach is to develop a product strategy based upon well developed technology route maps. This should ensure that a succession of market leading products and services are available, ahead of your competition
·         Planned changes to products should be accumulated and introduced, following the necessary evaluation and verification testing, as carefully timed product updates
·         Part of the engineering budget, including identified resources, should be allocated to making necessary changes.
·         Who should be involved?
o     Senior management team members with responsibility for marketing, engineering, manufacturing and programmes should take responsibility for a holding regular product reviews and initiating any necessary changes
o     Suppliers and customers should be involved making recommendations on how they might contribute improvements and reduce the costs of trading
·         Note that:
o     Changes to components must be strictly controlled: making changes due to shortages or lower cost alternatives can have dire consequences
o     Current items must not be replaced with lower specification components without the necessary evaluation and testing, also verifying their availability
Factors for Success      
Factors to  Avoid
1.     Changes are planned and driven by managers across the business
2.     Resources are made available for reviewing and initiating any changes
3.     All changes are implemented using the company change control process
4.     All documentation is current
1.     Allowing changes to be made in order to resolve short term supply issues
2.     Purchasing making decisions based solely on obtaining price reductions
3.     Introducing unplanned changes as a direct reaction to external influences
4.     Introducing change for the sake of change
Who does this apply to?
Senior managers and their teams, sales, purchasing
Realisable Benefits
Prolonged product life, improved competitive position, retention of customers

Guides:

Strategy and product innovationStrategy and product innovation

Strategy and product innovation

Identifying knowledge and technologiesIdentifying knowledge and technologies

Identifying knowledge and technologies

Product introduction processProduct introduction process

Product introduction process

Product and manufacturing designProduct and manufacturing design

Product and manufacturing design

Updating existing products and servicesUpdating existing products and services

Updating existing products and services

Product introduction programme measuresProduct introduction programme measures

Product introduction programme measures

Intellectual propertyIntellectual property

Intellectual property