What is the success rate of product development today? We have some research that’ll give you some insight.
It is common for manufacturers to wonder if other people are successful with product development or not. Many report that they feel they are uniquely poor at it, especially with hitting release dates and shifting people around. However, the research we have introduces findings that there are widespread issues with the process of product development.
First, we found that 20% of all projects are eventually canceled. While this number isn’t horribly high, a 12 to 15% range of project cancellations should be what manufacturers strive for. Part of a normal portfolio management process implies that you need to kill projects every once in a while. Requirements might change or there might be a disruptive release of a new product where a subsequent release that you had planned no longer makes sense. Cancellations are a common occurrence, but companies have been witnessing an increase in how many projects fall victim to this.
One-quarter of all projects are not launched on time, meaning you’ve missed your launch or delivery date. Often when a project is late is you will see executives start to shift resources or reassign resources from current ongoing projects to that one project that is a priority. 42% of projects are successful in launching a product or delivering them on time, but this is only achieved through a 10% shift in resources. Even with this extra effort, 25% of projects still miss that launch date.
This leaves a mere 13% of all projects that are launched on time without any resource changes. This is the percent of projects that go as expected.
If you’re reviewing how your company runs product development internally and you see teams running into roadblocks or projects completely failing, you’re not alone. Many other companies are in the same boat. However, this is where technology-led initiatives can let you take advantage of this improvement opportunity. These improvements are often combinations of people changes in staffing roles and responsibilities, training process changes in checks, steps, and extra work upfront so you can save on the backend, process changes, and technology change.
These findings should be viewed as an improvement opportunity that allows you to compete better in the market, lets you improve your profit/margin, lets you improve the company, and helps you meet other success in product development