New Product Development

Running head: NEW PRODUCT DEVELOPMENT
New Product Development
Name of the Student:
Name of the University:
Author Note:

1NEW PRODUCT DEVELOPMENT
Executive Summary:
The report shows that there is ardent need in the banking sector to make vigilance over inflows and outflows to check threats like
money laundering. Threats like money laundering are threats to the global economy as a whole and requires involvement of
stakeholders. The report then goes on to introduce a new product which would enable customers to get involved in fighting money
laundering and cyber theft. The report assumes that the innovative product called CBA Secure would be introduced by
Commonwealth Bank of Australia. The report also shows that the bank would use NPD method to launch the product.

2NEW PRODUCT DEVELOPMENT
Table of Contents
Introduction:....................................................................................................................................4
Outline of the new project (product):..............................................................................................4
Justification of using new product development method to develop CBA Secure:........................5
Step 1. Generation of idea:..........................................................................................................5
Step 2. Idea evaluation:................................................................................................................6
Step 3. Testing the concept:.........................................................................................................8
Step 4.1. Concept development:..................................................................................................8
Step 4.2. Concept testing:............................................................................................................8
Stage 5. Market strategy development:.......................................................................................9
Step 6. Product development:....................................................................................................10
Stage 7. Market feasibility testing:............................................................................................10
Step 8. Commercialisation:........................................................................................................11
Justification of using NPD method by CBA in introducing CBA Secure:............................11

3NEW PRODUCT DEVELOPMENT
How prepared is the firm for this technological innovation?........................................................12
Risk return analysis of the technological innovation:....................................................................12
Commercialization of the technological innovation:.....................................................................13
Evaluation of the impact of the new project on the firm’s overall success in the next 5 to 10 years: 14
Discussion on findings and analyses:............................................................................................15
Conclusion:....................................................................................................................................15
References:....................................................................................................................................16
Appendix: Risk register:................................................................................................................20

4NEW PRODUCT DEVELOPMENT
Introduction:
Multinational banks today play a very important role in facilitating flows of financial resources in the global economy. These
banks in order to serve their customers operate on both traditional banking platforms as well as fintech (financial technology) enabled
platforms. These two platforms combine to process millions of financial transactions. The companies in order to transfer and receive
payments today use the digital banking platforms. The individual customers today prefer to carry on thousands of transactions on the
online banking portals. The increasing demands of business and domestic customers have fueled technological advancements which
have led to internet banking and application based banking or app banking available on smart phones. The users of these digital
banking platforms today conduct immense amount of online transactions by inputting confidential information like bank account
numbers and personal identification numbers or PIN numbers. The illegal groups can use technology to gain these confidential pieces
of information and steal money online from the respective bank account holders. These groups often use the banking channels of
multinational banks to commit crimes like money laundering and to inject illegally earned money or black money into economies.
These threats have attracted the attention of the governments and central banks of the countries to direct the banks to keep vigilance on
the inflows as well as outflows in the accounts of the customers. However, the threats of money laundering have reached a level far
beyond the control of the banks alone. This calls for a new product which would enable the customers to get involve to assist the
banks tackle the threats of money laundering.

5NEW PRODUCT DEVELOPMENT
Outline of the new project (product):
The new product under study would be owned and marketed by the Commonwealth Bank of Australia or CBA. The
innovative product would be an application compatible with laptops, desktops and smart phones named ‘CBA Secure’. The new
product development (NPD) and commercialization process to be adopted for technological innovation: The new product which
CBA would develop would be a net banking application which would allow customers to identify the records of all their past banking
transactions including both debits as well as credits. The customers would be able to report poor services which they might receive
from their respective bankers in managing and reporting fraudulent transactions. The net banking application would enable the
customers report poor record keeping practices of any bank. This system of reporting would resemble a crowd sourcing method would
enable the customers lodge complains against inefficient banks. The advertising and use of the app called CBA Secure would generate
revenue for CBA, its owner and developer. The bank would be able to spread awareness about the app by using its marketing
channels. This would enable the bank to generate immense revenue by attracting huge numbers of customers to use the app.
Justification of using new product development method to develop CBA Secure:
Common Wealth Bank of Australia or CBA would use new product development process to develop CBA Secure. This
choice of NPD can be justified on the grounds that allows the manufacturing process to take into account both external influences and
internal influences. This would allow the final product to be more aligned with the requirements of the business strategies of the bank
concerned as well as the requirements of the consumers (Lentner, Szegedi & Tatay, 2015). The following are the steps which the
development of the new product under study namely, CBA Secure would undergo:

6NEW PRODUCT DEVELOPMENT
Step 1. Generation of idea:
The first step which CBA should take into account to develop CBA Secure would be idea generation. As pointed out by
Schemmann et al.(2016), the business organisations should take into account the findings from market research as well as internal
environmental research. CBA being an Australian international banking organisations should scan both its home country namely,
Australia as well its host countries like India. The company has presence in Asia, Europe, New Zealand and North America
(Commbank.com.au, 2019). This means that CBA in order to develop CBA Secure should take into account the macroeconomic
factors of all these markets. The company should identify the gaps which the banking customers are facing in these markets in terms
of securing their respective bank accounts like threats of online cash thefts and money laundering. The bank should use these gaps as
opportunities to generate ideas which it would incorporate CBA Secure. Calderon and Schaeck (2016) in this respect point out that the
banking sector being the bone of the economic development of every country, is highly under the regulations of the respective
governments and central banks. This means that CBA should also collaborate with the governments and central banks to gain their
inputs in the development of the app. The banking company should conduct a research on its internal capabilities like current
technological competencies of its employees, the level of technological advancements its systems have achieved and the financial
resources it has to develop the new products. The analysis of external and internal environmental factors would lead the staff members
of the bank to generate ideas which would be considered while developing the new product namely, CBA Secure (Serrat, 2017). The
management of the bank should also consider the ideas expressed by the employees in developing the new product.

7NEW PRODUCT DEVELOPMENT
Step 2. Idea evaluation:
The management of the CBA should evaluate the ideas generated by the employees as well as the findings from the external
market analysis. The bank while evaluating the ideas should take into account the potential benefits which the customers’ feedback
which it had gained during the process of the macroeconomic analysis conducted in stage 1. The bank should take into account the
constraints which it might face while developing the product in terms of technology as shown in figure 1. The bank should screen the
potential benefits which the ideas generated could usher to the new product namely CBA Secure.