Lean product development is a term that applies to various strategies used to design products utilizing the highest level of cost controls possible, while still achieving an acceptable level of quality. Just as lean production focuses on manufacturing those goods as inexpensively as possible, this approach to the creative aspect of product development seeks to control the costs of every aspect of the research and development phase. Lean product development (LPD) begins with the creation of initial idea for the product, follows on through the design phase, and even into the construction of a prototype and field testing the result.
The goal of lean product development is to research and develop new products in the most cost-effective manner possible. With this approach, care is taken to evaluate any expense associated with the project and seek to manage each task using all available resources to best advantage. Employing lean principles to the development process does not mean choosing to avoid expenses when they are key to the development effort, but does focus on qualifying each expense to make sure it is necessary to the overall effort to efficiently develop a product that is likely to generate profits for the business.
Utilizing a lean product development mindset means making the most efficient use of all resources on hand, including management and labor. Managers must be well schooled in how to evaluate tasks and procedures used in the development process. This includes working with purchases to locate and secure raw materials for the development that will aid in creating and testing a prototype without creating a great deal of expense. In like manner, lean product development involves the judicious and productive use of labor to manage the design phase of the new good, as well as the creation and launch of a field study to test the prospects of the product. Doing so means that the company has a minimal investment in the product design, and is able to absorb the cost should the final stages of the development process reveal that the item is not likely to be as in demand as hoped.
As with the use of lean methods for production, shipping, marketing and other essential tasks in the operation of a business, lean product development makes it easier to allocate sufficient resources for the process and keep the activity within that budget. Under the best of circumstances, the effort allows the development to occur with only a minimum impact on the financial status of the company, and sets the stage for possibly generating a considerable profit once the developed good actually goes into production and is marketed to consumers.