New Product Development in North American Manufacturing


To obtain information on the pressures faced by consumer and industrial manufacturers, and the new products those companies are developing in response, in order to write a perspective white paper.

Early Findings

Pressures facing manufacturing companies

  • The biggest challenges currently facing the consumer products industry include intense competition for a limited number of product spaces, shrinking operating margins due to globalizing price points, and mitigating risk due to adverse events like recalls.
  • While revenues have increased steadily for the past 50 years, margins have fluctuated wildly. While they grew 646 basis points from 1985 to 2000, they declined by 57 basis points from 2007 to 2011.
  • Goods manufacturers with a global business can suffer from trying to conform to global regulatory standards, but also due to a strong dollar; for example, Johnson & Johnson lost 14.2% of their international sales in 2015 due to currency fluctuations.
  • In 2018, 2.9 million non-fatal workplace accidents were reported by manufacturing companies, a majority of them linked to lifting and handling.
  • Another issue is the growing pressure to employ modern technology in manufacturing, such as Internet of Things (IoT)-based inventory tracking. 59% of retailers have invested or are currently planning to invest in smart inventory tracking.
  • For the moment, while automation is increasing in manufacturing, robots are a positive pressure on the industry, and contributed to adding 900,000 jobs between 2010 and 2016.

Responses by manufacturing companies

  • Some manufacturers risk falling behind because they aren't able to afford the high entry costs of robotics and automation. In response, other companies are offering robotics as a service, allowing systems to be loaned or rented.
  • Competition requires manufacturers to increasingly rely on omnichannel supply chains; many companies are responding by turning to advanced inventory technology to sort out complex processes, such as portable computers, wearables, and tracking software.
  • Research suggests that in new product development, increased stress due to the pressures of competition doesn't always adversely affect developer performance. Pressures framed as "challenges" rather than "hindrances" have been found to increase team performance.

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