Successful newproduct development (NPD) requires effective strategies for reducing risk.Knowledge management systems (KMS) have the potential to aid in risk reduction, e.g. by gathering and processing relevant information and encapsulated knowledge from a variety of internal and external sources. The potential benefits of KMS, however, have not been fully realized, and may actually introduce new risks. This paper presents a practioner view of the desired characteristics of tools to support NPD and suggests a research agenda for the use of knowledge-based tools from the perspective of balancing benefits and risks.