Designing a Dynamic Model for New Product Development by Emphasizing on Bass Diffusion Theory

Document Type : Original Article


1 Assistant Professor, Rasht Branch, Islamic Azad University, Rasht.

2 Assistant Professor, Science and Research Branch, Islamic Azad University, Tehran.

3 M.A, Rasht Branch, Islamic Azad University, Rasht.


Consideration of critical factors in successful development of new products is one of the main factors in customers’ attraction and achieving competitive advantage. This study aims to investigate the effect of making policies around key factors of new products development (NDP) on increase of customers’ attraction rate. Considering dynamics of model’s parameters over the time and importance of innovation diffusion in NDP, in this research, Bass diffusion theory and system dynamics approach are used for modelling the problem. In this regard, first by reviewing the literature and interviewing with the experts, critical factors for successful development of new products were identified. Then, by determination of the relationships among research variables and exploration of dynamic hypotheses, cause & effect and stock & flow diagrams were developed. Finally, after definition of dynamo equations and simulation of the model in Vensim software, model’s validity was verified. The results from implementing four policies, namely: basic, advertisement, R&D and balanced advertisement and R&D, indicated that simultaneous increase in R&D and advertisement budget, can be more effective in customers’ attraction and success of NDP.


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