The Harvard Business Review case study article "Spark Innovation Through Empathic Design" emphasizes creating products and services that emphatize with customers in relation to their moods, emotions, needs, wants, and desires.
A current industry trend towards clothing has been the love and fad for stonewashed and prewashed jeans. The major player sporting these kind of styles is GAP INC. (consisting of Old Navy (low-tier), GAP (mid-tier), and Banana Republic (upper-tier). GAP INC. has captured a market niche with regards to trendy "antique-type" clothing. The concept of the design of the jeans is to portray a hip and trendy casual wear primarily aimed at the younger crowd. The jeans are designed to seem as the denim is faded through many wash cycles which gives it the chic distinguised characteristic with loose and visible incomplete stitching and "wear and tear" on the pockets to make it seem that the jeans are so-called "beat-up" that give it a vintage look from the 1960's-1970's.
However, the jeans do have their acclaimed critics who are either opposed or in favor of the jeans. As for the defiant, it seems as they are offended by the image of the jeans as class-less and intended to be "dirty." It portrays a image of a potential homeless "pauper" who has bought the jeans through either a thrift shop or Goodwill. Since they are perceived as badly beaten due to their fadedness nature by being washed over and over again abusively and having open holes with loose stitching through the knee-cap area.
The opposers are also outraged and furious and outraged at the "price-tag" of these jeans that run about $60-$70. There main argument is why should we feel like paying this erroneous amount for piece of so-called "thrash" that will degrade us and make a "fool" out of ourselves.
Fortunately, the folks for the jeans are fanatics with this phenomenon. The jeans have become somewhat of a "nostalgic" memory that they go back and relate to their childhood back in the 1960's-1970's where everything was so trendy with the "hippie" culture that emphasized it was "cool" to have long shaggy hair with fuzzy beards complimenting a carefree and innocent environment. The fans feel rejuvenated and enlightened to race to the shelves and crank out $60-$70 for a pair of these jeans. It's a rebellious revoution of the denim jean. The jeans for the in favor of are ment to be cool and relaxed at the same time conveying a person's individualistic freedom of self-expression.
The spark of innovation through empathic design in regards to authentic vintage jeans is not so much emphatical with respects to the opposing critics than with the in favor of crowd. However, the jeans strike an equal balance between the new and old with different perspectives of the varying views at stake. The futurists might be suggesting to cross-over this trendy design for the love of classical and vintage automobiles and once again rebirthing the love for the original television format in black and white. Only time and taste will reveal what's next to come.
Friday, February 29, 2008
Friday, February 22, 2008
PEPSI WITH YUM?
The Harvard Business School article dated February 20, 2007: iPOD vs. Cell Phone: A Mobile Music Revolution illustrates the recent contractual partnerships between cell phone carriers and PC-based companies such as Apple and Microsoft to embed digital mobile music on cell phone headsets. Apple's combination with Motorola and Cingular to come out with the ROKR has paved the way for soft drink giants like Pepsi to enter into similar contractual "combination" partnerships.
Aiming towards the fast food industry, Pepsi has been highly successful with establishing economies of scale and at the same time achieving sustainable competitive advantage through the sort of concept of "multibranded" conjoined megaplex restaurants that carry exclusively Pepsi products and soft drinks.
For example, a recent surge of development including 3-in-1 restaurants consisting of Pizza Hut, Taco Bell, and Kentucky Fried Chicken are appearing around major metropolitan cities which provide a taste for the pizza lovers, chicken lovers, and Mexican food lovers.
These restaurant deals are emerging under the company brand name of YUM which "supposedly contracts with Pepsi. The standard has been set worldwide and not just in the United States that any customer visiting any of the above mentioned restaurants will solely only come across Pepsi products as their choice of/for beverage. However, note to be taken, these combination restaurants are under individual franchise "parent" names in their respective countries of origin.
This concept of Pepsi trying to gain economies of scale is already in effect in countries such as the United Kingdom, Mexico, Australia, South Korea, Germany, Indonesia, and the United Arab Emirates (U.A.E) (Dubai) just to name a few. The strategy reflects Apple's endeavor with its iTunes concept to be solely and exclusively installed and used with the Motorola ROKR phone which, unfortunately, failed and did not get a chance to be used to its potential due to cost inefficiencies for Apple's customers.
The future prediction and direction for such markets seems to be on a bright outlook as more individual companies who are solo on their own try to contract with other "like-minded" counterparts possibly in the retail and hospitality industries. Only time shall reveal.
Aiming towards the fast food industry, Pepsi has been highly successful with establishing economies of scale and at the same time achieving sustainable competitive advantage through the sort of concept of "multibranded" conjoined megaplex restaurants that carry exclusively Pepsi products and soft drinks.
For example, a recent surge of development including 3-in-1 restaurants consisting of Pizza Hut, Taco Bell, and Kentucky Fried Chicken are appearing around major metropolitan cities which provide a taste for the pizza lovers, chicken lovers, and Mexican food lovers.
These restaurant deals are emerging under the company brand name of YUM which "supposedly contracts with Pepsi. The standard has been set worldwide and not just in the United States that any customer visiting any of the above mentioned restaurants will solely only come across Pepsi products as their choice of/for beverage. However, note to be taken, these combination restaurants are under individual franchise "parent" names in their respective countries of origin.
This concept of Pepsi trying to gain economies of scale is already in effect in countries such as the United Kingdom, Mexico, Australia, South Korea, Germany, Indonesia, and the United Arab Emirates (U.A.E) (Dubai) just to name a few. The strategy reflects Apple's endeavor with its iTunes concept to be solely and exclusively installed and used with the Motorola ROKR phone which, unfortunately, failed and did not get a chance to be used to its potential due to cost inefficiencies for Apple's customers.
The future prediction and direction for such markets seems to be on a bright outlook as more individual companies who are solo on their own try to contract with other "like-minded" counterparts possibly in the retail and hospitality industries. Only time shall reveal.
Friday, February 15, 2008
IN-HOUSE AT PITNEY BOWES AND MCDONALD'S
The Harvard Business School case study article of December 4, 2006: Pitney Bowe Inc. discusses quite well how a company within the postage stamp industry manufacturing postage stamp meters also at the same time simultaneously provides management and consulting services for its customers/clients.
An illustrative and intellectual argument can be debated with a reputably established brand within the fast-food industry which is well-known and identified with its customers.
The ever-great McDonald's chain of restaurants has taken their condiments as a matter on their own terms. As recently to date, everything from soft drink cups to ketchup is either exclusively made by McDonald's or for MacDonald's. In the earlier days of the restaurant's history all its condiments were either partnered or contracted through Heinz Corporation or Hunt's Corporation. In latter years and until recently all condiment packaging for McDonald's states that it is made for or by McDonald's at their headquarters in Bloomington, Illinois. Thus, if an individual were to ever take notice the ketchup packaging then it would mention McDonald's "Fancy Ketchup" and no such signs of either brand of Hunt's or Heinz as ketchup distributors is visible.
This argument along with Pitney Bowes' similar so-called "in-house" management practice of their supply, unfortunately, takes away the competitive advantage of the individual/independent service providers like the United States Postal Service and Mailboxes Etc. who are also in business for the management of postal services for their clients. With the case of McDonald's, Hunt's or Heinz ketchup distributors are snatched away from competing for their piece of the pie from McDonald's and it international market for substantial revenue and profits.
On the other hand, both McDonald's and Pitney Bowes benefit from economies of scale efficiencies due to cost-reductions because of in-house production which would enable them to use there own materials, labor, and supplies at a fraction or even half of the cost, whereas, the direct distributors would maybe charge double the amount or even triple (with regards to hidden costs) to produce the same/similar ketchup recipe or mail services that either company can produce in the same way or maybe better.
In closing, let's not be surprised if either Pitney Bowes or McDonald's (perhaps a ketchup making factory) outsource their management services overseas internationally to places like China or India for more economic cost benefits in the long-run. This is the sign of the times.
An illustrative and intellectual argument can be debated with a reputably established brand within the fast-food industry which is well-known and identified with its customers.
The ever-great McDonald's chain of restaurants has taken their condiments as a matter on their own terms. As recently to date, everything from soft drink cups to ketchup is either exclusively made by McDonald's or for MacDonald's. In the earlier days of the restaurant's history all its condiments were either partnered or contracted through Heinz Corporation or Hunt's Corporation. In latter years and until recently all condiment packaging for McDonald's states that it is made for or by McDonald's at their headquarters in Bloomington, Illinois. Thus, if an individual were to ever take notice the ketchup packaging then it would mention McDonald's "Fancy Ketchup" and no such signs of either brand of Hunt's or Heinz as ketchup distributors is visible.
This argument along with Pitney Bowes' similar so-called "in-house" management practice of their supply, unfortunately, takes away the competitive advantage of the individual/independent service providers like the United States Postal Service and Mailboxes Etc. who are also in business for the management of postal services for their clients. With the case of McDonald's, Hunt's or Heinz ketchup distributors are snatched away from competing for their piece of the pie from McDonald's and it international market for substantial revenue and profits.
On the other hand, both McDonald's and Pitney Bowes benefit from economies of scale efficiencies due to cost-reductions because of in-house production which would enable them to use there own materials, labor, and supplies at a fraction or even half of the cost, whereas, the direct distributors would maybe charge double the amount or even triple (with regards to hidden costs) to produce the same/similar ketchup recipe or mail services that either company can produce in the same way or maybe better.
In closing, let's not be surprised if either Pitney Bowes or McDonald's (perhaps a ketchup making factory) outsource their management services overseas internationally to places like China or India for more economic cost benefits in the long-run. This is the sign of the times.
Saturday, February 9, 2008
THE IDEO PRODUCT DEVELOPMENT PROCESS
The Harvard Business School case study article of April 26, 2007: IDEO Product Development discusses the product development process through "so-called" phases of innovation process consisting: Phase 0, Phase I, Phase II, Phase III, and Phase IV.
The Phase O stage emphasizes understanding and observing the client's needs and the current products already existing for the client to build upon new services or extensions of product lines.
Next, Phase I is considered the actual "beginning" phase which emphasizes visualization and realization. In this stage of the product development phase examples, samples, and prototypes of potentially considered products are chosen for further study and research. The product design team would also have a sense of "realization" of what the actual expectations of the clients are through coordination and feedback.
Phase II of the product development process focuses on evaluating and refining the prototypes that are in place for consideration as potential new product ideas or designs. The phase reinforces and reviews the sample product for any predictable future technical issues that might confuse and confront an average user of the specified product and corrects the deficiencies. By the end of phase II's completion, the revised product design most often and probably turns out to be the prototype that will become the actual product on the market for the end user.
The product development process of phase III deals with detailed engineering implementation. This phase consists of mock trial and error and market testing with consumers before the product is finalized to be mass-produced by machines on the assembly lines. Possible suitable prospective vendors through whom the new service or product will be distributed are evaluated and selected.
Last but not least, phase IV of the product development process also deals with implementation, however, it consists of a manufacturing liaison. This phase is strictly to ensure a smooth product release from the manufacturing department. During the trail/beginning days of the product in existence, the product development team still makes sure to supervise the production of tooling, regulatory approvals, and construction of pilot runs of the manufacturing line while in the sensitive early stages.
The product development process of phases at IDEO can be illustrated, for example, to show the new G2 Gatorade drink just recently released during Super Bowl Sunday. G2 is supposedly a Gatorade drink with fewer lower calories and replinishes your thirst and body fluids muck quicker and sooner than regular Gatorade. The Gatorade G2 production design team may just have used a similar development method (such as at IDEO) for the creation of their new Gatorade product line extension drink.
The Phase O stage emphasizes understanding and observing the client's needs and the current products already existing for the client to build upon new services or extensions of product lines.
Next, Phase I is considered the actual "beginning" phase which emphasizes visualization and realization. In this stage of the product development phase examples, samples, and prototypes of potentially considered products are chosen for further study and research. The product design team would also have a sense of "realization" of what the actual expectations of the clients are through coordination and feedback.
Phase II of the product development process focuses on evaluating and refining the prototypes that are in place for consideration as potential new product ideas or designs. The phase reinforces and reviews the sample product for any predictable future technical issues that might confuse and confront an average user of the specified product and corrects the deficiencies. By the end of phase II's completion, the revised product design most often and probably turns out to be the prototype that will become the actual product on the market for the end user.
The product development process of phase III deals with detailed engineering implementation. This phase consists of mock trial and error and market testing with consumers before the product is finalized to be mass-produced by machines on the assembly lines. Possible suitable prospective vendors through whom the new service or product will be distributed are evaluated and selected.
Last but not least, phase IV of the product development process also deals with implementation, however, it consists of a manufacturing liaison. This phase is strictly to ensure a smooth product release from the manufacturing department. During the trail/beginning days of the product in existence, the product development team still makes sure to supervise the production of tooling, regulatory approvals, and construction of pilot runs of the manufacturing line while in the sensitive early stages.
The product development process of phases at IDEO can be illustrated, for example, to show the new G2 Gatorade drink just recently released during Super Bowl Sunday. G2 is supposedly a Gatorade drink with fewer lower calories and replinishes your thirst and body fluids muck quicker and sooner than regular Gatorade. The Gatorade G2 production design team may just have used a similar development method (such as at IDEO) for the creation of their new Gatorade product line extension drink.
Friday, February 1, 2008
IS IKEA INVADING AMERICA?
The Harvard Business School Case article of September 14, 2004: IKEA Invades America by YoungMe Moon discusses a Swedish Scandanavian company called IKEA. This is the first furniture retail company to establish an all-in-one concept of a childcare center, restaurant, and a bank for the convenience of its shoppers. The concept has captured the retail furniture market like never before.
IKEA's successful business model emphasizes a "self-service" attitude for its customers. This concept of "do-it-yourself" encourages customers to assemble the bought furniture from Ikea (as all the furniture is unassembled and consists of many parts). At the same time, due to elimination of overhead costs and absence of assembly labor, IKEA passes on the savings to the customer as bargains.
The brainstorming process at IKEA is of great importance as the company recruits internally for the design and implementation of any new style or fashion of furniture design. At the same time, it fosters healthy and productive competition within the engineers and designers for potential bids. Also, with regards to the work environment, there is no rule of formalities, therefore, all the employees from the CEO to lower-level executives/personnel are addressed by their first name. Everyone is encouraged to provide their insights and recommendations for the betterment of the company.
The innovations by Ikea can and do have a "trickle-down" effect on the already established companies in corporate America. For example, some companies have captured their own market niche such as: USAA, Southwest Airlines, and Costco Wholesale.
At USAA a culture similar to IKEA exists. USAA provides childcare services for its employees where they can drop of their kids at the day care center before reporting to work.
Southwest Airlines corporate culture instills an environment for its flight attendants to dress as casual and comfortable as possible without requiring the employees to wear "official" Southwest Airline uniforms. One may not be surprised to come across a male flight attendant wearing shorts and a Polo Ralph Lauren t-shirt (as their uniform) on flights originating from Texas where the weather is crucibly untolerable during the summer months. Southwest also provides a comfortable atmosphere for its passengers with unassigned random seating and all the seats consist of leather material for more comfort during your flight.
Last but not least, Costco Wholesale's business strategy model is similar (from a wholesale store prespective) to IKEA that it usually has multiple items of the same kind of items bundled together. For example, by bundling two boxes of Cheerios cereal instead of one, it can provide the item at more bargain prices. The wholesale atmosphere is more geared towards large groups, businesses, and most importantly families. Also, by charging a club membership, Costco is able to cater more efficiently to its customer's by providing "member's only" prices and since it does not deal with third-parties or middlemen, it is able to cut costs and pass along the overhead savings to the consumer. Costco's 100% Satisfaction Guarantee on its warehouse club membership and online at Costco.com also refunds back the complete shipping and handling charges as its "unconditional, no questions asked" money back guarantee.
The unique comepetitive advantage that Costco has is that it also caters to "non-members" of Costco for a small surcharge on any purchase.
IKEA's successful business model emphasizes a "self-service" attitude for its customers. This concept of "do-it-yourself" encourages customers to assemble the bought furniture from Ikea (as all the furniture is unassembled and consists of many parts). At the same time, due to elimination of overhead costs and absence of assembly labor, IKEA passes on the savings to the customer as bargains.
The brainstorming process at IKEA is of great importance as the company recruits internally for the design and implementation of any new style or fashion of furniture design. At the same time, it fosters healthy and productive competition within the engineers and designers for potential bids. Also, with regards to the work environment, there is no rule of formalities, therefore, all the employees from the CEO to lower-level executives/personnel are addressed by their first name. Everyone is encouraged to provide their insights and recommendations for the betterment of the company.
The innovations by Ikea can and do have a "trickle-down" effect on the already established companies in corporate America. For example, some companies have captured their own market niche such as: USAA, Southwest Airlines, and Costco Wholesale.
At USAA a culture similar to IKEA exists. USAA provides childcare services for its employees where they can drop of their kids at the day care center before reporting to work.
Southwest Airlines corporate culture instills an environment for its flight attendants to dress as casual and comfortable as possible without requiring the employees to wear "official" Southwest Airline uniforms. One may not be surprised to come across a male flight attendant wearing shorts and a Polo Ralph Lauren t-shirt (as their uniform) on flights originating from Texas where the weather is crucibly untolerable during the summer months. Southwest also provides a comfortable atmosphere for its passengers with unassigned random seating and all the seats consist of leather material for more comfort during your flight.
Last but not least, Costco Wholesale's business strategy model is similar (from a wholesale store prespective) to IKEA that it usually has multiple items of the same kind of items bundled together. For example, by bundling two boxes of Cheerios cereal instead of one, it can provide the item at more bargain prices. The wholesale atmosphere is more geared towards large groups, businesses, and most importantly families. Also, by charging a club membership, Costco is able to cater more efficiently to its customer's by providing "member's only" prices and since it does not deal with third-parties or middlemen, it is able to cut costs and pass along the overhead savings to the consumer. Costco's 100% Satisfaction Guarantee on its warehouse club membership and online at Costco.com also refunds back the complete shipping and handling charges as its "unconditional, no questions asked" money back guarantee.
The unique comepetitive advantage that Costco has is that it also caters to "non-members" of Costco for a small surcharge on any purchase.
WHAT'S STIFLING THE CREATIVITY AT COOLBURST?
The Harvard Business Review case article of September-October 1997: What's Stifling the Creativity at CoolBurst portrays an Miami-based fruit-juice company established in schools and restaurants around the states of Florida, Georgia, Alabama, and South Carolina. Unfortunately, the obstacle and challenge for the company to overcome was the inability of the CEO of CoolBurst Mr. Garth LaRoue to embrace change and innovation. Mr. LaRoue was vulnerable to the concept of change and had a "if aint broke, don't fix it" as is mentality. However, this atmosphere at CoolBurst led Sam Jenkins, a former employee at CoolBurst, to deviate from CoolBurst and form his own company and also create a rival product called Thirst Smasher. Jenkin's thrist for innovation and risk led to a successful counter product against CoolBurst. The employees of CoolBurst would also always be discouraged from innovating even though many had inspirational ideas. They just viewed themselves as a simple fruit juice company and nothing more. In summary, if the CEO of CoolBurst attempted to embrace risk and innovation then his company would not be at a crossroads with a creation of a rival product such as Thirst Smasher developed by Sam Jenkins. Overall, if change had been accepted by Mr. LaRoue then there might have been a possibility that Sam Jenkins would have not left CoolBurst.
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