Challenges to Overcome During the Development of a Product

Are you about to embark on the development of a product for your company? Learn here possible challenges to avoid on the project.

June 27, 20237 min read

Konstantin Dolgan

Written by Konstantin Dolgan, Ph.D., NPDP

Founder & CEO, Product Development Engineer

Published June 27, 2023Updated September 2, 2026

Many decisions have to go into the development of a product. Hence, these decisions will determine if the product will make it to the market or if another product should be considered. Throughout the production cycle, the product manager has to constantly make these decisions.

The PM has to determine what processes or issues to focus on and how to allocate resources to each. While some of these decisions may seem isolated, they contribute greatly to the success of product development.

For instance, the supply of resources may seem like a different session of production. However, if there is a late supply of resources, insufficient supply, or too much margin of over-delivery, the production process may be affected.

The PM needs to anticipate possible needs and challenges in new product development. Hence, this article will help PMs and company directors identify challenges that they should envisage. By foreseeing these possible obstructions, they can rightly estimate how long it take to develop a product in their company.

Product development team reviewing prototype parts and open risks around a conference table
Cross-functional risk reviews surface budget, schedule and manufacturability problems while they are still cheap to fix.

Challenge 1: Product Development Budget Constraints

Using the top-down budgeting procedure can put great pressure on the PM and other product production team members. (The top-down procedure is when the chief executive or finance department determines the budget for a product development project.)

Find out more here on how to estimate the cost of a prototype in product development. In essence, no matter how tedious the project is, the production team can only spend within the range of the provided budget.

The procedure uses miscellaneous to cover possible extra expenses. However, it is not unlikely that there might be extra cost arising that supersedes whatever miscellaneous is provided. Hence, the bottom-up procedure is better recommended.

The bottom-up procedure ensures that each team involved in the production cycle gives an estimated budget of what they need for the project. Even though this procedure is set, again, extra costs may arise at any of the production cycles that may not be catered for in the budget.

For instance, a lot of costs are often required when research and testing indicate that a product needs major modification. Hence, there might be a need to update the budget along the way. But if such provision is not available, it may be challenging to have a successful product development project.

Product development team reviewing prototype hardware and open program issues

Challenge 2: Pricing and Quality Compliance during the Development of a Product

Government policies can be a major challenge during product production. Price policies can come into play via the import of materials, minimum wage, interest rate, etc.

Also, the production process needs to fulfill the quality expectations of the government, shareholders, and customers. Aside from these two, your product and its production process must satisfy the ethical principles of the community. The PM needs to put in place a quality control process from the start to tackle this issue.

The starting idea of a product might not consider all these factors. Hence, it can be increasingly challenging to complete a product production if these issues arise later. Usually, these are some of the issues that can have legal implications if neglected.

Challenge 3: Resource Shortage in Product Development Management

Different teams will be working on a product. Hence, it is the job of the PM to ensure that there is transparency and collaboration among those teams. For instance, it is often said that the engineering and marketing department are often at loggerheads.

A lack of cooperation will result in a shortage of human and material resources. Consequently, the workflow needs to be well managed. You can learn about how to manage manufacturing workflow in this article.

A major cause of abrupt workflow is usually poor communication in teams or with other teams. Also, constant assessment of tasks and setting deadlines will help control and maximize resource usage.

Challenge 4: Time Challenges in New Product Development

Depending on the product, deadlines can be very significant to the success or failure of the product. Its risk becomes a major challenge for contracted products. Regrettably, teams may be faced with too many unforeseen circumstances that may hinder meeting a deadline.

For instance, a delay in hiring the right staff can slow down the pace of innovation. Equally important is the time to enter the market. Market competition can be too fierce to go launch a product an hour, day, or month after.

Hence, each process must be made seamless to prevent slow-paced feedback or late delivery. Importantly, adequate time estimation and deadline must be achieved to prevent lags. You can learn more here about how long it can take to build a prototype.

FAQs about Challenges to Overcome During the Development of a Product

Here are some of the questions asked online about challenges faced by businesses during product development.

1. What is the most difficult part of product development?

Research and testing stand out as the most difficult part because they can completely disrupt the production process. For instance, if it indicates usage complications or low market demand, the product might require reprocessing. Hence, product development management must make provisions for thorough research at every stage of developing a product.

2. What are the major requirements for product development?

Customer needs are dependent on time, cost, and quality. Therefore, these three factors must be focused on during product development to satisfy customer needs. Through customer satisfaction, it would be easy for the new product to increase its market share.

3. What are the types of product development?

A company can develop an existing product that is new to the company. Also, product development can focus on an innovation that is entirely new to the market. Alternatively, companies can manufacture their existing products after improving some of their features. Lastly, product development can be an extension of a product line. This type of product development requires introducing similar products by the brand but may differ by cost or quality.

4. How can product extension be done?

Product extension can come in the form of changing product content or packaging. A company can change the makeup, ingredient, core flavor, sugar composition, etc., of a product to extend its product line. However, the change can be an alteration of the packaging to change the design, size, or overall outlook.

5. How to overcome possible challenges during the development of a product?

Challenges are best dealt with when properly addressed through anticipation. Hence, choosing a simple concept with a lot of potentials should be prioritized at the start of product development. Such products will be easy to modify to meet consumer needs and gain market trust.

It’s a Wrap

Not all challenges faced during the development of a product can be avoided. However, preparedness does help ensure that the issue is well handled.

It is not unlikely that some issues that are recurrent in the product production cycle of your company are not listed here. You need to anticipate such challenges and prevent them from happening again.

Are you finding it difficult to deal with some product development issues in your company? LA NPDT is here to help you out. We are a consultancy company with several product launches.

You can join our long list of successful companies by messaging us on our website Read more on Lanpdt or call us at 318-731-9573 for more information.

Challenges in Product Development

Challenge
Description
Budget Constraints
Managing finances, especially with top-down budgeting, and unforeseen costs.
Pricing and Quality Compliance
Adhering to government policies, quality expectations, and ethical principles.
Resource Shortage
Ensuring collaboration and transparent communication among teams to prevent human and material resource shortfalls.
Time Challenges
Meeting deadlines, managing unforeseen circumstances, and ensuring timely market entry.
Research and Testing
The most difficult part, as it can disrupt production and require reprocessing.

Sources and standards

Diagnosing which challenge you actually have

Product development challenges present with similar symptoms — slipping dates, rising cost, rising frustration — but the underlying causes need different treatments. Applying more hours to a requirements problem, or more process to a capability problem, is how programs stall twice. The diagnosis is usually visible in what changes between weekly updates.

Symptoms, causes and treatments

Symptom
Likely root cause
Wrong treatment
Right treatment
Scope keeps growing
No frozen requirements
Working longer hours
Written requirements plus change control
Repeated design rework
Manufacturing brought in late
More design reviews
Early DFM with a real supplier
Cost above target
Architecture decided without a cost goal
Supplier negotiation
Concept-phase cost workshop
Dates slip in small increments
Optimistic estimates, no critical path
Status meetings
Lead-time-based schedule and gates
Quality issues at build
Insufficient verification
Blaming the supplier
Written protocols and acceptance criteria
Team overload
Too many parallel programs
Motivation pushes
Sequencing and explicit prioritization

The clearest tell is whether the same issues recur across programs. Recurring problems are systemic and belong to process; one-off problems belong to the specific program and should not trigger a permanent process change.

A quarterly program health review

  • List every change request and where it originated.
  • Compare current cost estimate to the original target, with reasons.
  • Check whether the critical path is still built on lead times.
  • Review the top three risks and whether any mitigation actually happened.
  • Ask which issues are recurring across programs, and fix those in process.

Key takeaways

  • Similar symptoms have different root causes; diagnose before treating.
  • Recurring issues are process problems, one-offs are program problems.
  • Effort cannot fix a requirements or architecture problem.

What challenges in new product development actually cost

Every challenge on this page has a price, and the price is the argument that gets a fix funded. The numbers below are typical of small and mid-size hardware programs: a consumer or industrial product with 20 to 200 parts, one or two suppliers, and a team of fewer than fifteen people.

Challenge
Typical cost when it lands late
Cheapest point to catch it
Requirement change after detailed design
3-8 weeks and a redrawn tolerance stack
Requirements freeze gate before detailed design
Tooling change after first article
$2,000-$15,000 per steel modification
Design for manufacture review at 60-80 percent
Component obsolescence
4-16 week redesign and re-certification
Lifecycle check at BOM release
Certification failure
6-12 weeks of retest plus lab fees
Pre-compliance testing on the engineering build
Supplier capacity shortfall
Missed launch window, air freight at 5-10x sea
Capacity check written into the quote
Unclear ownership between teams
Silent slippage discovered at integration
Named interface owners at kickoff

The pattern is consistent: the cost of a problem multiplies roughly ten times each phase it survives. That is the whole case for gates. A gate is not bureaucracy — it is the last cheap place to find something.

A mitigation plan you can run in a week

  • List the top five risks with an owner, a trigger and a written fallback for each.
  • Convert the two riskiest assumptions into a test on the next prototype build.
  • Confirm second sources for every single-sourced component on the BOM.
  • Book certification lab time before the design is final; lead time, not testing, is the constraint.
  • Agree a change-control rule: batched releases with an effectivity date, not ad-hoc edits.
  • Review the risk list at every program meeting and close items explicitly.

Which product development challenge causes the most delay?

Late requirement changes. They arrive after drawings, tooling quotes and test plans already depend on the old requirement, so a one-line change triggers rework across every downstream artefact. Programs that hold a genuine requirements freeze finish measurably closer to their original date than programs that stay flexible.

Key takeaways

  • A problem gets roughly ten times more expensive each phase it survives.
  • Requirement changes after detailed design are the most common single source of delay.
  • Second-source every critical component before you need to.
  • Risk items need an owner, a trigger and a fallback, or they are just a list.

Program stalled and not sure why?

Talk to our team

Related articles

All articles

Get in touch

Tell us what this is about

Share a few details about your question, partnership, or idea — a member of the LA NPDT team will reply within one business day.

Optional context

What are you looking to accomplish? (optional)

What do you already have? (optional — tick any)

Your information stays confidential and is never shared.