New service development: Linking resources, processes, and the customer

Abstract

New service concepts are at the heart of success, and the process can be optimized by implementing new service development (NSD) models. NSD models are rarely used in practice, however. Many companies use historically successful new product development (NPD) models to develop services, and ultimately ignore the challenges and opportunities specific to services. The objective of this research paper is to determine the key success variables of an NSD model. Several NSD models are reviewed to mine the key traits of a successful NSD model. After a comprehensive literature review, three hypotheses proposed in the paper are: a well-structured NSD model is necessary for the success of a new service; resources should be given equal attention to the processes involved in a NSD model, and customer involvement is a vital component of the NSD model. Finally, an extended NSD model is proposed, one which is based on Froehle and Roth's work. This extended model integrates the resource and process oriented practices of NSD with a new “customer” dimension. We show how this model can be applied, using the airline industry as an example.