Question

What facors raises to aproove the product?

Answer 1

Management teams that successfully identify and roll out new products and services typically have a documented, repeatable, and auditable process to guide their decision making. In practice, this often means that the board approves and the management team follows comprehensive new product policies and procedures, documents decisions sufficiently, and ensures that all relevant functions within the organization appropriately engage with one another.

 

Management and the board are wise to assess the sufficiency of their new product policies and procedures. They may want to consider whether these policies:

require management and staff from various functions – including compliance, accounting, risk, internal audit, and line management – to vet, review, and recommend new products and services for senior management or board approval;

cover the investigative stages of new products and services as well as the approval and deployment stages;

require that operating policies and procedures are updated to provide clear guidance to staff on how to comply with all legal or regulatory requirements associated with the new product to avoid violations of law and undue exposure to legal liability prior to product introduction;

address and mitigate risks throughout the product life cycle, including pricing, marketing, distribution, accounting, and ongoing service and maintenance; and

require a post-decision review to determine whether the new product or service met the expectations and assumptions used to support the decision.

Management and the board should also ensure that the organization’s culture encourages constructive dissent and robust dialogue around all issues. This could be evidenced by documenting dissenting viewpoints or considerations along with the new product recommendation.