There are three major areas of risk in the product development process when it comes to developing new hi-tech products:
- Technology risk
- Management risk
- Market risk
We tend to dwell on the first two, because that is what you’re aware of on a day to day basis.
Will the technology work? Do you have good development and communication processes? Do you have the right people? is the project on track? and so on…
But by far the biggest area of risk is the third one — market risk. Think about it, you only really know if you’ve got a flop on your hand when you launch the new product into the market. By that stage, you’ve already spent all of the development budget.