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Research Outline
Prepared for Frank B. | Delivered March 4, 2020
New Product Development in North American Manufacturing
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Goals
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.
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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
o
m
n
i
c
h
a
n
n
e
l
supply chains
; many companies are responding by turning to
advanced inventory technology
to sort out complex processes, such as portable computers,
w
e
a
r
a
b
l
e
s
, 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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