Question

Explain the degree to which NPD Acceleration and Planned Obsolescence are related and whether this is a good business practice.

Answer 1

This is a good question. The answer to this is yes, NPD and Planned Obsolescence are related. To understand how and why, let us first understand what the two are:

Planned Obsolescence is a business strategy where the "death" of a product is planned and incorporated into the strategy surrounding the product. For example, consider Apple. Apple releases various versions of the iPhone. Now, they also relese operating system (OS) updates from time to time. If you notice, they stop supporting certain phone models after a period of time. For example, they might say that iOS 11 might no longer be compatible with the iPhone 5 and older devices. What does this mean? This means Apple is indirectly forcing its consumers to switch/upgrade to a newer device. This is how organizations ensure planned obsolescence is carried out.

NPD is a fairly simple term - it means New Product Development. This is the art of designing and bringing to market a new product. Since R&D activities surrounding new product development generally take years, we have the concept of NPD acceleration which means reducing the go to market lead time of products. An integral part of this strategy is linking it to planned obsolescence.

As you might have observed by now, planned obsolescence and NPD acceleration are closely related. Why? Any business will build planned obsolescence into its strategy to ensure its customers go ahead and buy a newer product, right? Now, in order to ensure that there is a newer product developed and out there in the market, the company needs to have its new product development process up and running. To ensure that the go to market lead time is less, companies need to have accelerated new product development processes, and it should be closely tied to the planned obsolescence strategy. For example, if Apple has decided to stop supporting the iPhone 4 by stopping OS updates, then it should ensure it has an iPhone 5 ready for the market.

Thus, yes the two are related. While it is debatable if this is a good practice as there is also an ethical angle it, it purely depends on what the customer wants. The customer should take an informed decision before deciding if an upgrade is worth the money. From a purely business angle, yes it makes sense, but it is definitely not ethically correct.