|
|
|
|
Product for Sale:
Profit and Viability in Product Design The dreaded Tuesday morning product meeting rolled around again despite my best efforts. We found ourselves sitting at the conference table with the marketing group and nobody was happy. It wasn’t always this way. The meetings used to be fun before the competition threw us a curve ball with some new products and we were suddenly striking out with some of our best customers. It looked like the company was going the way of buggy whip manufacturers, computer wholesalers, Internet grocers, and other obsolete business. Sam, Marketing Director, and Pete, Product Design Manager were going at it again. They’d carried over their argument from last week about specifications and it just wasn’t getting any better. The rest of the team watched with varying degrees of bemusement and/or concern while trying to keep a low profile. Nobody was seeing eye to eye on anything. At the risk of getting skewered by both Sam and Pete, I stood up and asked for a chance to speak. I told the group that I thought we could do a better job of picking our product targets and designing them. I said that I would appreciate their attention while I opened some windows on the subject. Larry, as to be expected, made a snide comment about there not being any windows in the conference room but then admitted that any new light on the problems would be welcome. This doesn’t have to be so difficult if you look at it the right way. Our two major product questions are simply: 1) how do we pick products that customers will buy, and 2) how do we design those products so we can reliably deliver what customers want? The following discussion summarizes what I told the team. It opens two windows of discovery to help answer these questions. Further it suggests ten tactics for making sure the windows work for you. Marketing Window:The first window of discovery is the Marketing Congruence Window showing overlapping views of your marketing people and target customers. You experience marketing congruence when the offered products are close enough to what the market needs so people buy them. There are four panes or quadrants in the marketing window. See the figure below.
A) Target Design Quadrant: what you know to be acceptable to customers and is truly so, B) Avoided Design Quadrant: what you think you know to be acceptable but is truly not, C) Risk Quadrant: what you don’t know and is truly unacceptable, and D) Luck Quadrant: what you don’t know but is truly acceptable. Most products overlap into more than one quadrant even though marketing and product design experts try their best to stay in quadrant "A." In reality we can’t know everything so some of what we design into our products is going to fall into the unknown. We hope that very little falls into risk quadrant "C" because that is where marketing disasters lie. We spend mega-bucks on creating a product that we think is acceptable but in the end the market determines it to be truly unacceptable. If we knew that in advance we wouldn’t have created it. Right? We know enough to stay out of "B," we’ll take the luck if we land in "D," but there’s nothing but trouble in "C." The marketing risk quadrant contains failed products, wasted time, costly diversions, and lost investments.We had been so stuck in the safety of quadrant "A" we missed opportunities for improvement that the competition had seen. Once we started looking through the window, we could see what happened and find new ways to compete. Product Design Window The product design window shows the overlapping views of designers and customers as they relate to the physical design or delivery of your product or service. The panes or quadrants of this window are similar to the marketing congruence window but the players are different. Marketing and design can easily be in conflict. Product designers work to make the target design quadrant as large as possible and to make sure that their designs lie only there even while marketing wants something different. For them, it’s more important that the design be safe than to satisfy all of marketing’s wishes. Design mistakes entail a large risk of failure as demonstrated by the 2000/2001 travails of the Firestone Tire company as it struggles to recover from the almost billion dollar cost of having made tires that had design elements that fell into risk quadrant "C." Nobody knew that certain design features would ultimately result in the catastrophic failure of their SUV tires in use.
Product designers are generally motivated to be as conservative as possible. The risk of failure tends to lead designers away from cutting costs, minimizing materials, adding features, and taking chances in general. It’s often much easier to make incremental design changes gradually than to be bold and innovative. Nobody wants to have a product recall on their resume. We learned that information is power. The more designers know about the product design performance, the more highly optimized the design can be in terms of cost and performance. Customer satisfaction will ultimately be determined by the combination of cost and performance that the designers can deliver. This is a strong incentive to get it right. Cleaning the Windows
So what can you do about this situation? You know what you know but you don’t know what you don’t know. A natural tendency is to concentrate on what we know about what’s acceptable and what’s unacceptable. Marketing and design will try to reach a compromise on design based on the "facts" at hand. Here are ten tactics for cleaning your windows to gather more information:
Discipline, methods, and open minds are central to finding clarity in the marketing and product design windows. Without any one of these three ingredients, the grime accumulates quickly, just like it always does. Don’t fall into the Tuesday morning trap like the people in this story. Learn Advanced Product Development techniques from an expert in creativity: Steven C. Martin is one of fewer than 300 people in the world to have a Master of Science degree in Creativity. He is a member of the adjunct faculty of the International Center for Studies in Creativity at the State University of New York College at Buffalo. He is a patented inventor and creativity expert who has taught widely in a broad range of settings. We teach creativity and innovation in courses ranging from hours to one week. These high-impact hands-on creativity sessions are guaranteed to teach you how to be more creative and innovative.
|
Cost Reduction & Profit Improvement
|
