Product development in manufacturing SMEs in a rural area

Abstract

Small and medium–sized enterprises (SMEs) are fundamental to the welfare of regions. Innovativeness and efficient new product development (NPD) play an important role in firm development. The aim of this regional study is to clarify how NPD processes are organised in micro, small and medium–sized firms that manufacture machines for farming in a region, where farming forms the basis of a functioning food processing cluster. The study used semi–structured interviews to reveal the real status of NPD processes. It identified three main product development process types: non–formal, partly formal and formal. End users are seldom involved in assessing the ease of use of new products. Surprisingly, there was no clear relationship between the share of exports on one side and the formality of NPD processes or company size on the other.