GSBS6012 Entrepreneurship: Innovation Plan for New Product Development

This report presents an innovation plan for a major enterprise, focusing on new product development (NPD) and commercialization of a technological innovation. Assuming the role of CIO, the plan centers around 'CBA Secure,' an application by the Commonwealth Bank of Australia designed to enhance vigilance against money laundering and cyber theft. The report details the NPD process, including idea generation, evaluation, concept testing, market strategy, product development, and commercialization. It assesses the firm's preparedness for technological innovation, conducts a risk-return analysis, and evaluates the project's potential impact on the firm's overall success over the next 5 to 10 years. The plan emphasizes collaboration with stakeholders and leveraging market research to align the product with business strategies and consumer needs. This document is available on Desklib, a platform offering a wealth of academic resources for students.

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.

8NEW PRODUCT DEVELOPMENT
Figure 1.Conceptual Framework of Current Meta-Analysis
(Source: Chang & Taylor, 2016)
The management of CBA should take into account the ideas expressed by the employees in evaluating the ways incorporation
of ideas would contribute the success factors of the new app in the global banking market as shown in the figure below (Florén et al.,
2018). The management of CBA should then screen the ideas to take decisions about the attributes of the new app namely CBA
Secure.

9NEW PRODUCT DEVELOPMENT
Figure 2.A
conceptual framework of success factors in the front end of new product development
(Source: Florén et al., 2018)
Step 3. Testing the concept:
The management of CBA at this stage must integrate the ideas screened in the previous stage in the concept of the target
product namely. CBA Secure. Cooper (2016) in this respects point out that company at this stage shapes the ideas into an actual
product.

10NEW PRODUCT DEVELOPMENT
Step 4.1. Concept development:
The management of CBA along with the research and development team develops the ideas into an actual product. Fleischer et
al. (2016) mention in this respect that the company at this stage develops a number of versions of the new product to be developed.
CBA would then test each version against the findings of customer expectations and feedbacks.
Step 4.2. Concept testing:
CBA at this stage tests the concepts of the new product developed. Cooper (2016) mentions that at this stage the companies
developing new products, gain participation of the customers to test the actual market performance of the product concept developed
in the previous stage. Commonwealth Bank of Australia at this stage introduces the new app developed among the customers to test
their reactions and feedbacks about it. For example, as per the description of CBA Secure, the customers would be asked to upload the
banking issues which they are facing regarding tracking the inflows and outflows in their respective bank accounts due to lack of
sufficiently strong online banking vigilance of their present banker. The marketing personnel would then record the time which the
preliminary version of CBA score would take to record and report the entire complaints. The company at every stage should record
whether the product meets the requirements and expectations of the customers. The company at this stages observes the customers’
reactions to the new product. The marketing department of the company interview customers about the product to gain idea about the
acceptance in the market which the final version of the product namely, CBA Secure would gain in the market.

11NEW PRODUCT DEVELOPMENT
Stage 5. Market strategy development:
Commonwealth Bank of Australia should develop market strategy for the new product namely, CBA Secure. Chen et al.
(2016) mention in this respect that business organisations developing new products recognise the target markets in which they would
introduce the product. For example, in this case that target market of CBA Secure would the present markets in which CBA operates.
Najafi-Tavani, Sharifi and Najafi-Tavani (2016) strengthens the argument by mentioning that the companies at this stage then go on to
make strategies on the pricing strategies, place strategies and promotional strategies of the product. CBA as per this finding would
make the strategies regarding the marketing mix of the new product to be developed, CBA Secure. Laine, Korhonen and Martinsuo,
M. (2016) strengthen the arguments of the previous authors that the companies should also form the long term sales targets which they
aim to achieve by the sales of the products. It can be pointed out as per this finding that CBA should form the long term sales strategy
of the product namely, CBA Secure. The management of the company should collaborate with the marketing department to form the
revenue generation which the bank aims to secure in the coming 1 year, three years and five years.
Step 6. Product development:
CBA at this stage develops the final version of the product which it aims to introduce into the market. Story, Boso and
Cadogan (2015) at this stage the business organisations developing new products inject immense amount of capital in development of
the final version of the new product which would be actually introduced into the market. It can be pointed out in this stage CBA
should channelize immense capital towards development of the final version of CBA Secure.