Posts Tagged ‘product development’

A brief history of flash memory – and how Apple used it to change everything

Thursday, October 21st, 2010

Remember this? It used to be the killer app using flash memory.

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Here is the flash killer app, circa 2010:
air

And Apple is the reason. When flash memory was used to move files between computers so you could print them, Jobs & Co. were seeing that riding the Moore’s Law curve on flash could allow them to build small, beautiful, powerful devices that people could afford.

The first step was the Apple Nano in 2005. It could store up to 4GB of music.
first_generation_nano_i

Then the first gen iPhone in 2007. It had 8GB of flash memory.
iphone

iPhone 3G, 2008, had up to 16GB of flash.
iphone3g

Then, in 2010, came the iPad, with up to 64GB of flash memory. By this time, Apple flash devices (iPod Shuffle, Nano & Touch, iPhone and iPad) were selling upwards of 20 million units in the most recent quarter, making Apple the world’s largest purchaser of flash memory.
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And now we have come about as far as we can from the humble thumb drive. The new MacBook Air has 64GB or 128GB of flash memory – no hard drive, no fan. The netbook has been truly reimagined. And you can’t help but think that Jobs saw this coming five years ago.

Other “a brief history of…” posts:
A brief history of wheeled luggage
A brief history of the frialator

HBR article recommends confronting new venture risks early

Wednesday, May 19th, 2010

Once upon a time in innovation, there was a general rule: get to market as quickly as you can, meaning you should start on your “long-pole” development activities as soon as possible. But there’s a growing consensus in the innovation community that the best way to succeed isn’t to start developing quickly, but instead to do as much work as possible on paper, to validate assumptions cheaply and quickly, and defer more expensive, riskier (and even long-pole) activities until after some of the basic assumptions are validated.

Part of this thinking encourages innovators to rank their risks – to work on critical assumptions first. In case those assumptions don’t pan out, the entire venture might fall apart: all the better to look at them early. That’s the premise behind the article “Beating the Odds When You Launch a New Venture” by Clark Gilbert and Matthew Eyring in the May Harvard Business Review.

The authors identify three types of risks that should be evaluated early in a new venture’s life:

1) Deal-killer risks – risks that can sink the venture. Often these seem to be marketing and sales related risks: will anyone buy the product we want to build? Given that engineers often start with a product idea, it’s easy to see why market testing is often left to last. However, prototyping and beta launches (common with internet products today) can provide cheap and quick data about a product’s attractiveness to the market.

2) Path-dependent risks – these are situations that could go down multiple paths – for example, a new product that could be useful to consumers or businesses. Committing to one of these paths, and later learning the other path was a better choice, wastes time and money, and risks the venture never fulfilling its potential. The authors recommend entrepreneurs carefully evaluate these alternate paths early on, and consider outsourcing or other ways to cost-effectively pursue both paths until the correct one becomes clear.

3) Risks that are simple and quick to evaluate – validating other assumptions, that may not be as critical as the above two, but which can be simply and cheaply tested, can reduce the overall risk of the venture.

This thinking is similar to ideas put forward in last year’s book “Innovation Tournaments” by Terweisch and Ulrich, which also discussed testing high-impact risks early, before expensive steps like building supply chains.

And, of course, all these efforts owe a debt to the thinking of McGrath and MacMillan, whose book “Discovery-Driven Growth” is the bible of the test-assumptions-first school.

Related posts:
A brief definition of strategy (Clark Gilbert)
When innovating, try more and more varied ideas (Innovation Tournaments)
On “Discovery-Driven Growth”

We have an innovation problem, and it is miles and miles of indistinguishable stuff

Wednesday, October 28th, 2009

Video 6 0 00 09-27I learned today that Axe Body Spray for Men is running an ad in Uruguay where readers sending an SMS to their address receive on their phone the missing bits of a picture of a beautiful woman. (Those bits are clothed, BTW.)

This tells me there’s nothing about Axe the product that is distinctive, and the ad, despite being fun and engaging (especially for teenaged and 20-something males), won’t do much to make people select Axe over one of the thirty other male scent products out there.Video 6 0 00 17-27

I started thinking about this after listening to Jonathan Salem Baskin’s neat Listrak webinar last week, entitled, “Marketing Ideas for the First Post-Brand Decade.” Baskin did a nice job of showing that while customers and markets have moved beyond the days of “Mad Men” – where a well-crafted, creative advertisement could influence us to buy the latest dish detergent or safety razor – marketers, by and large, have not. Even “social media marketing,” like, say, the Axe campaign, is taking the same old ideas and porting them to new technology.Video 6 0 00 22-12Video 6 0 00 26-07 Houston, we have a problem. Marketers are pushing the same old buttons to sell more variations of the same old products. It’s a negative-sum game. Variations increase cost without enlarging the overall market. Redundancy pushes down prices, invites private label competitors and overloads consumers’ minds.

Clearly, we’ve got to do something different. Marketing needs to pull back from its focus on distribution, packaging, and communication, and refocus on helping create great new products, that deliver distinctive value and make people’s lives better. Then it will be easy to communicate that to prospective customers.

Gary Hamel writes in “The Future of Management” that product & service innovation are near the bottom of the innovation hierarchy, and the pinnacle is “management innovation.” To Hamel, products are easily duplicated, quickly eliminating their added value. But as Roberto Verganti pointed out in “Design-Driven Innovation,” companies that create truly visionary products enjoy long periods of competitive advantage and profits.

Life is too difficult for many and too complex for everyone else. Everyone would like to have more fun. Therefore, there’s lots of need for products & services that allow us to manage our lives better or have diverting or engrossing experiences.

I’ve been reading “Change by Design,” by Tim Brown, and he asserts that companies need to adopt “design thinking” to create great new products and services. I can’t disagree with him, but also feel that design thinking is not that different from what great product managers and developers have been doing and should be doing. So, if your new-product group wants to hand over the reins to design thinkers, that’s their prerogative. For me, that’s the fun part of the job and I’d rather not outsource that.

Related posts:
On “The Future of Management”
On “Design-Driven Innovation”

How radical innovation and careful customer listening go together

Thursday, September 10th, 2009

It may be difficult to square my current obsession with Roberto Verganti’s new book “Design-Driven Innovation” – a textbook study of how companies create way-out, game-changing innovations that users could never have dreamed up – and this blog’s focus on customer listening as a tool for improving innovation, customer satisfaction, etc.

But the truth is that these fit together quite nicely. While companies wishing to create the next iPod-like phenomenon may not want to poll their users for ideas, customer listening is a crucial part of making these innovations successful. Here’s an important passage from Verganti’s book:

Executives who have invested in radical innovations of meaning acknowledge that rather than start with user needs, the process goes in the opposite direction: the company proposes a breakthrough vision. Stunningly, Alberto Alessi uses almost the same words as Ernesto Gismondi to illustrate this concept: “Working within the meta-project transcends the creation of an object purely to satisfy function and necessity. Each object represents… a proposal.”

Design-driven firms don’t crowdsource–they make proposals. And here’s where customer listening comes in. Proposals invite responses. And once products – even design-driven products – are released, they continue to evolve based on how and why people end up using them–which can result in them occupying a different market space than originally envisioned.

With Design-Driven Innovation, proposals shouldn’t get universal acclaim–if they are radical enough, the company should expect and welcome some level of rejection and antipathy (see Lenny Bruce reference in this post. But in the feedback they generate, there are seeds of insight. Is the proposal being understood? Are there unexpected uses?

So the techniques we’ve discussed previously in this blog – customer story gathering, finding patterns, devising adjustments to the product/services – are just as suitable for products created through design-driven innovation. In fact, the more radical the vision, the more necessary they may be.

Related posts:
Lenny Bruce was happy with the support of 1/3 his audience
On “Design-Driven Innovation”
Podcast with Roberto Verganti
Innovation moving from initiatives to experiments

Don’t worry about Lego Star Wars impairing kids’ creativity

Tuesday, September 8th, 2009

The New York Times this weekend profiled the business revival at Lego Group (”Turning to Hollywood Tie-Ins, Lego Thinks Beyond the Brick“).

The numbers speak for themselves:

Amid a 5 percent drop in total United States toy sales last year and the industry’s worst holiday season in three decades, according to Sean McGowan, an analyst at Needham & Company, Lego’s sales surged 18.7 percent in 2008. And despite a worsening global recession, Lego powered through the first half of 2009, with a 23 percent sales increase over the period a year earlier. It earned $355 million before taxes last year, and $178 million in the first half of 2009.

But the article contained an ominous message:

In the United States, Lego’s biggest market and the biggest toy market in the world, games with themes like “Star Wars” and “Indiana Jones” were among the reasons Lego sales jumped 32 percent last year, well above the global pace. But experts like Dr. Jonathan Sinowitz, a New York psychologist who also runs a psychological services company, Diagnostics, wonders at what price these sales come.

“What Lego loses is what makes it so special,” he says. “When you have a less structured, less themed set, kids have the ability to start from scratch. When you have kids playing out Indiana Jones, they’re playing out Hollywood’s imagination, not their own.”

Even toy analysts who admire the company and its recent success acknowledge a broad shift. “I would like to see more open-ended play like when we were kids,” says Gerrick Johnson, a toy analyst at BMO Capital Markets in New York. “The vast majority is theme-based, and when you go into Toys “R” Us, you’d really be challenged to find a simple box of bricks.”

Um… these guys have never been to my house. My 8- and 6-year-old sons are big Lego fans. Last winter, when we were at Disney, my 6-year-old chose to spend his birthday at the Lego Imagination Center. They’ve gotten “theme-based” kits for the Hogwarts Castle, various Star Wars fighters and Indiana Jones.

But if you think that has inhibited my kids’ creativity, you are dead wrong. Once these kits are built (sometimes even before they’re built), the pieces are repurposed to fit whatever my kids want to make. The 8-year-old built a little Segway-like device for a Storm Trooper to battle in; the 6-year-old mashed up a character with Storm Trooper legs, Indiana Jones’ whip and Harry Potter’s friend Hagrid’s bushy brown beard. The minifigures, in particular, are ripe for innovation and storytelling. Which makes sense–people like stories with other people in them.

Legos when I was growing up were 2- 4- 6- and 8-dot bricks, the occasional wheel and window. My guys have innumerable pieces from which to create–and they do, without limits and with interesting, unique pop-culture references that weren’t possible in my day.

I think creativity among our young is alive and well, and movie tie-ins won’t bother it.

Related post:
Lego knows partnering

A company’s online, sharable, living window to the outside world

Wednesday, September 2nd, 2009

I interned for IBM in the summer of 1983. It was the best summer job imaginable–fun work, smart people, good pay, and of course better resume fodder than my prior work experience (the hardware store).

My first month, though, I didn’t have much to do. Everyone was busy, and it was hard to ask busy people to find me an assignment (this problem got solved, but that’s another story). So I read a lot. In particular, every week or so a packet of information came through the interoffice mail, consisting of pages and pages of photocopied newspaper and magazine articles relating to IBM and its business.

I looked forward to each packet and read every article. I may have been the only one in the office to do so. But I was really curious about the business and it was great to have all that information in one place. I kept that curiosity, about the company I worked for, its markets and the macro environment, after that, and that may be why I later gravitated to outward-facing roles like marketing, sales and strategy.

At any rate, it’s 25 years later, and there’s more information about a company, its markets, and the outside world than in 1,000,000 article packs available at the click of a mouse. Yet companies continue to act as if they have no idea what’s going on outside their walls.

Harvard Business School’s John Kotter, in his great 2008 book “A Sense of Urgency,” blames an insulated culture for companies’ inability to sustain their change initiatives–he urges companies to “bring the outside in.”

Here’s how Kotter describes the importance of sharing information that allows employees to experience a broad view of the company and its prospects:

I can still remember a visit I made to a company ten years ago as if it happened last week. The firm had been exceptionally successful in the middle part of the twentieth century. But by the time of my visit, market share had been steadily eroding for twenty years. The company was in a war, badly wounded, some would say bleeding to death. Yet when I opened the door to corporate headquarters, I entered a visual fantasy world.

Nowhere was there a single sign that the company was struggling, had been struggling for two decades, and was continuing to be beaten again and again in the marketplace. Nowhere was there a sign that the technology affecting its products was changing faster, offering it wonderful opportunities to leap ahead of competitors. The huge waiting room was pin-drop quiet and had the air of an antechamber outside the king’s throne room.

In total contrast, I once visited a successful firm that seemed to have its entire outside world hung on the walls of its waiting room. There were pictures of customers, of its own products, of its manufacturing plants, office buildings, competitor products, recent articles from industry publications, and comments (mostly good and some bad) from customers. There were a few prototype sketches of products to come. There were two big charts, one showing margins over the previous two years (which made the firm look good) and one that showed stock price (which made the firm look not so good). The entire effect was somewhat like a teenager’s room, especially the picture of a competing CEO with a mustache drawn on it!

The second company’s waiting room walls provided employees and visitors with a multimedia picture of the outside world every day. It reminds me of the article packs I read during my tenure at IBM.

Imagine the wall, virtualized, visible on every employees computer desktop via the intranet. Imagine that any employee can post items: news articles, blog posts, Tweets, rumors, video clips, etc. Other employees could vote on the items, comment on them, point out patterns.

In other words, a living, breathing, interactive, multimedia, ubiquitous version of those waiting room walls.

The technology to do this is ubiquitous and fairly cheap. Most companies have the basic plumbing to do it already. All they need is the framework, the processes, and, perhaps most challenging of all, the will and courage to do it.

Companies have to decide whether they want to be more like Kotter’s first example–the fantasy world, or the second–immersed in the real world, in all its messiness, complexity and contradiction.

(Photo by stevendamron via Flickr Creative Commons)

Shop Talk Podcast: Roberto Verganti on “Design-Driven Innovation”

Tuesday, August 25th, 2009

Roberto Verganti’s book “Design-Driven Innovation” is one of the best business books of the year. It discusses the methods certain companies use to create products with radically new meanings, offering customers something they never realized they wanted and generating long-term competitive advantage and outsized profits as well. In this podcast, Professor Verganti discusses the ideas behind the book and how it applies to companies like Apple, BMW, Artemide, and Harley-Davidson.

For more information, visit the book’s companion website.

Podcast: Roberto Verganti on Design-Driven Innovation (mp3, 39:41)

Timeline:

0:35 What is the “meaning” of a product?

6:00 The meaningfulness of the iPhone

13:50 The role of “interpreters” in Design-Driven Innovation

19:50 Relationships between companies and interpreters

23:45 What is the CEO’s role in Design-Driven Innovation?

30:00 How much of the CEO’s time is required?

33:25 More resources on Design-Driven Innovation

Related post:
Review: “Design-Driven Innovation”

[Theme music: "Up the Coast" from West Indian Girl's CD "4th and Wall"]

The delight in using an innovation you had a hand in creating

Monday, August 24th, 2009

I am posting this from my laptop, about 30,000 feet in the air, somewhere over Virginia, I’m guessing. And it’s a thrill. Not only because it’s novel to have WiFi access in the air – I have a personal connection to this service.

Roberto Verganti mentioned in our podcast (to be posted tomorrow) that many CEOs of highly innovative companies have a personal pride in their products. They announce them and are personally invested in their success. If they fail, the CEO takes responsibility.

Of course, this kind of pride isn’t limited to CEOs (Prof. Verganti might observe that CEOs are sometimes less proud of their products than other employees). In fact, people who don’t even work for the company may feel connected to the product and share this pride.

And one illustration of it is the delight you get when you realize the product is being used by real people. In fact, this feeling may be the biggest rush in innovation. I remember, years and years ago, creating requirements for a tiny new component of an outside plant management system for GTE. I worked on it for a few months, then moved to a new assignment at the company and promptly forgot about it. A couple of years later, I ran into one of my co-workers from that project at a meeting. He told me that my module had been part of a release that was now in widespread use throughout the company. I was walking on air for a few hours after that.

The product I’m using now is called Gogo Inflight from a company called Aircell. I spent the better part of a year and a half consulting for the company that developed and now runs the ordering/billing/customer management system, Martin Dawes Systems. My work was way behind the curtain – negotiating with the company that hosts the servers, arranging hardware purchase and delivery, liaising between Aircell’s operations team and Martin Dawes’. Yet I’m no less proud of the end product than if my picture were on the Gogo home page.

It’s a bit of a miracle, actually, WiFi in the air. And though my work on the project was more blocking and tackling than anything else, I feel as if I own a tiny part of that miracle.

Innovation moving from initiatives to experiments

Monday, August 17th, 2009

An interesting piece in today’s WSJ Business Insight section (”The New, Faster Face of Innovation” by Eric Brynjolffson and Michael Schrage of MIT) asserts that information technologies are reducing the cost of business experimentation and increasing the speed of rolling out new processes and approaches to the organization as a whole. As a result, more and more businesses are moving to use experimentation as a basis of their innovation programs. Here’s an excerpt:

Innovation initiatives that used to take months and megabucks to coordinate and launch can often be started in seconds for cents.

And that makes innovation, the lifeblood of growth, more efficient and cheaper. Companies are able to get a much better idea of how their customers behave and what they want. This gives new offerings and marketing efforts a better shot at success.

Companies will also be willing to try new things, because the price of failure is so much lower. That will bring big changes for corporate culture—making it easier to challenge accepted wisdom, for instance, and forcing managers to give more employees a say in the innovation process.

There will be even better payoffs for customers: Their likes and dislikes will have much more impact on companies’ decisions. In globally competitive markets, they will ultimately end up getting products and services better tailored to their needs.

I agree with Brynjolffson and Schrage that experimentation-based innovation will have tremendous impact on improving products and reducing companies’ innovation costs. But while they credit IT enablers, I think there’s another crucial reason that experimentation is growing in popularity. Schrage touches on it in this video companion to the article:

Schrage mentions that companies need to be creating “a culture of experimentation rather than a culture of grand planning and initiatives.” And when he uses these terms, I start thinking about the Cynefin framework, devised initially by Dave Snowden and first published in a mind-blowing article in the IBM Systems Journal (Cynthia Kurtz and Dave Snowden, “The New Dynamics of Strategy: Sensemaking in a Complex and Complicated World“) .


The framework is useful for lots of purposes: knowledge management, strategic planning, managerial action (the subject of Snowden and Boone’s HBR article, “A Leader’s Framework for Decision Making“). But here I’m discussing applying it to thinking about innovation.

Schrage’s casual comment illuminates innovation’s relationship to Cynefin. “The culture of grand planning and initiatives” is dominant in most companies, and shows that they view innovation initiatives in the Complicated domain of the Cynefin framework (I find the original terminology from Kurtz and Snowden helpful–”knowable”). Knowable or complicated systems are ones where cause and effect are related–but may be separated in time. You often need expertise to diagnose and act on a situation, but once the system is solved, the way forward is clear.

Traditional innovation initiatives treat the interactions between companies, customers and markets as a Complicated system. Innovation projects are expensive and time-consuming – you often hire consultants to lend their expertise. There is a solution–certain objectives and expectations that the initiatives must meet (these are often encoded into business plans and pro forma P&L’s). Of course, you only need to be involved in one such initiative to know that they never deliver to plan. Innovation initiatives are always surprises–sometimes delightful upside surprises, but more often long, expensive failures. This is because they treat a Complex problem (in the Cynefin definition) with a tool suited for the Complicated domain.

In the Complex domain, cause and effect are not observable in advance–”grand planning” is not productive. The outcomes of a complex process seem logical – but only in retrospect. Why did Twitter evolve the way it did? Why was iPod/iTunes so revolutionary and so successful?

“The culture of experimentation,” on the other hand, acknowledges this complexity – that the objectives of innovation – creating interesting, popular, valuable and attractive new products and getting them into the hands of customers – are not straightforwardly attained and cannot be planned. When customers buy certain products, when they linger on certain web pages over others, when they flock to some brand-new platform, they are exhibiting behavior best described by the language of complexity. And the way to achieve progress in this domain is to use experimentation: generate lots of ideas – perhaps even some deliberate mistakes. Try them out. If something works, spread it around. If it doesn’t, kill it quickly and move on. Iterate. [The Toyota Production System applies this experimental thinking to manufacturing innovation.]

So, is the ability of information technology to make experimentation fast & cheap responsible for the increasing use of experimentation to achieve innovation’s goals? Yes, in part. But a great deal of the reason lies in the fact that the old way of innovating, “grand planning,” isn’t the right tool for the task.

[Another viewpoint on innovation and experimentation is in McGrath and MacMillan's recent book, "Discovery-Driven Growth." While the book doesn't use the Cynefin terminology or share the complex adaptive systems roots, it nonetheless focuses on the uncertainty of the innovation process and emphasizes the need to cheaply and quickly experiment, allowing successful projects to emerge.]

(Image source: Wikipedia article on the Cynefin Framework)

Related posts:
On deliberate mistakes
On “Discovery-Driven Growth”
An example of “safe-fail” experimentation

“Design-Driven Innovation”–the powerful advantage that comes from changing the meaning of a product

Wednesday, August 12th, 2009

One of the best books of the year is undoubtedly “Design-Driven Innovation: Changing the Rules of Competition by Radically Innovating What Things Mean,” by Roberto Verganti. In it Verganti, a favorite of this blog, attacks one of the central mysteries of innovation–how can a company successfully create a product that is a radical break from the past, and which shows the way to a new future?

We’ve seen these products at work. The mobile phone is one. The personal computer is another. We know that you can’t survey users to determine what these products will look like or what they should do. So how to create them (apart from cloning Steve Jobs, who seems to have a knack for the radical innovation)?

Most companies punt on this question and are satisfied to extend existing products into adjacent spaces, fix latent customer pain points, etc. These are fine tactics, but with the ease of imitating product features and the speed with which information and intelligence flows, extension is a less and less stable platform for growth (arguably, it is an unhealthy and unproductive basis for business – in Umair Haque’s term, “thin value“).

Besides, as Verganti points out, radical changes in meaning yield longer product life cycles and more profitability.

So what’s the key to achieving this sort of innovation? Verganti writes that it is changing the meaning inherent in the product. The Wii changed the meaning of gaming from “passive immersion in a virtual world for young adults” to “active physical entertainment for everyone” (p.65). iPod/iTunes changed the meaning of a digital music player from a storage medium to a seamless platform for finding, buying, organizing, transporting and listening to music. The iPhone (not specifically discussed in the book) changed the meaning of a mobile phone from a voice device, with a few data applications attached, to a platform where data applications are the central focus of the product. The phone part is almost an afterthought! (I’ve noticed that iPhone customers are very tolerant of poor voice quality and dropped calls–deficiencies that would doom a plain mobile phone.)

In all the above cases, the changes of meaning opened up entire new markets, created hard-to-duplicate ecosystems and caused competitors to spend time and resources figuring out what the changes meant and how/whether to follow.

So how would a company create a new meaning for a product or market segment? That will have to wait for another post.

Related postsi:
Roberto Verganti podcast
How to improve innovation in rapidly-changing markets
An alternate approach to innovation: the Lombardy Design cluster
A quick skim covering innovation, marketing and complexity