INVESTIGATION OF CHALLENGES FACED BY SMALL AND MEDIUM ENTERPRISES IN NEW PRODUCT DEVELOPMENT

A case study research was carried out on four manufacturing small and medium enterprises that are involved with new product development. Literature suggests that survival, growth and competitiveness of small and medium manufacturing enterprises are based on their ability to develop and introduce new products into the market. New product development has become a central mechanism through which a company’s strategy can be put into practice. Literature suggests that few articles have been written on new product development problems faced by small and medium manufacturing companies. The paper confirmed constraints faced by small and medium enterprises in developing new products such as lack of resources, poor coordination among various departments, lack of project management structures, weak strategic thinking, poor absorptive capacity and non-use of new product development frameworks. Small and medium companies must enable flexibility of staff movement among various departments to enable concurrent development of new products. Problems associated with lack of resources can be averted through formation of industry portals that can aggregate flexibility and agility. The time taken to develop new products can be reduced through sharing of information with their alliances and external networks including universities