New product design and development

• Businesses need to continually innovate, design and develop new products and services.
• This could be adding more features or developing a small design improvement.
• It is usually driven by need of the business to develop or maintain competitive advantage in marketplace.
• New product design will focus on satisfying the needs of customers who already consume the products of a particular business as well as attempting to sell to new customers.
• New product design is necessary to maintain market share because demand for most products will decline over time.

New service design and development

• Service design and development differs from the design and development of products as services are intangible.
• Services are, by nature, typically customised.
• A service can be:
  • explicit – the tangible aspect of the service eg time, expertise, skill and effort
  • implicit – the intangible aspects of the service eg the feeling of being looked after
• Both explicit and implicit aspects must be addressed in the design of a service.
• Service, level of skill, time and expertise must be considered

Extract from Business Studies Stage 6 Syllabus. © 2010 Board of Studies NSW.