A Critical Look at the Product Development Industry
The product development industry focusing on hardware, IoT, and connected consumer devices has many relevant opportunities that the industry could benefit from. There are opportunities to expand this market with who can and who can not create a product. Traditionally it has been limited to big companies with big R&D budgets.
PERSPECTIVE ON CHANGE
There is no lack of product ideas, but there is a lack of funding to develop those ideas. People need funding because development is long, hard, and difficult. There is an opportunity to simplify an unnecessarily messy process to enhance creativity rather than to subdue it.
Industry participants need to rethink how they do business in product development. Why does it need to be so difficult? Why does hardware need to be so notoriously hard? Participants need to think about how can I make this industry more accessible rather than how can I make the cost to develop more expensive and for the chosen few? People need to accelerate agile thinking, apply generalist approaches to solving creative problems, and eliminate waste in every step of the process required to achieve a functional prototype. The implications of incorporating these new approaches will result in disruption and cost constraints, but it will also expand the market to a broader audience.
People need to accelerate agile thinking, apply generalist approaches to solving creative problems, and eliminate waste in every step of the process required to achieve a functional prototype.
Traditionally, consumer device companies have had success with their projects because of their access to “hard to find” suppliers, engineering talent, and unique supply chains. Traditional manufacturing processes and suppliers were hard to find and always relationship based. Quality could only be ensured by visiting suppliers in person and gaining trust through hand shake deals. This exclusive access is a capability and competence that resulted in competitive advantages. This capability requires heavy investment (time and money) but soon could not be necessary. Suppliers are becoming more digital and opening up their access points to more people. Platforms are connecting small players with big ones and accessibility is becoming easier than ever. Companies in this industry need to recognize that increases in global access to suppliers will help the industry expand and become more connected. Abandoning the assumption that digital manufacturing is not feasible will help the industry modernize itself and improve it dramatically.
BELIEFS & UNCERTAINTIES
It is generally accepted that how to get an idea made in the connected device industry is complex and challenging. The industry is quite fragmented and access to new technologies is splintered to only the chosen few. Developing new hardware requires heavy capital investment upfront and generally new products tend to struggle to outperform their expectations in terms of product reliability and performance. Strategically, companies do better if they achieve some vertical integration in order to minimize design hand offs and are able to reduce time to market for their products. The conventional truth is this is the solution to solving the pains of controlling the process and quality from beginning to end. This vertical integration is difficult to execute on and cause heavy barriers of entry for new players. The industry is consolidated and the belief is this is the best way to turn ideas to products fast and reliably.
People’s ideas will continue to evolve and technology will always be pushed to its limits by innovation.
Developing new devices will continue to be challenging and complex, as with any new product development. People’s ideas will continue to evolve and technology will always be pushed to its limits by innovation. There is a conventional truth that vertical integration is the leading strategy in the industry. This truth appears to be less and less important as the industry becomes more digitally connected and globalized. Expertise is becoming less localized (US and UK) and the talent pool for creative consumer focused minds is spread more evenly across the globe due to the interest in education in design thinking and a generally more global view of product design. There was an industry belief that this focus of talent would stay isolated to 1st world markets, but with increase in accessibility to technology and the tools of engineering have spread the talent pool across the globe.
The industry is positioned to enhance creativity and innovation but the critical question is will the industry adopt a more distributed network approach or continue down the traditional path of closed loop minimal growth.
Where is this industry heading? Will the industry continue to consolidate? WIll small players compete with increased access to technology and global platforms? It is certain that the connected device and IoT markets will continue to grow as our lives become more and more connected and sensorized. More people will need more data and devices will be needed to gather that data. The industry is positioned to enhance creativity and innovation but the critical question is will the industry adopt a more distributed network approach or continue down the traditional path of closed loop minimal growth. The Product Development industry needs to adapt. A connected mindset needs to be considered in order for the industry to grow and expand rather than consolidate and potentially shrink. The barriers to enter the market needs to be minimized in order to allow more people with valid ideas to enter the market and succeed.
Mid term to long term, the consumer device industry has an opportunity to expand at an accelerated rate. Sticking with traditional beliefs that hold back innovation and continue to label hardware as “hard” will only slow down the potential growth. Having a daily perspective on change to increase accessibility to technology is a critical mindset reset that could benefit the industry as a whole.
Are you a believer in this perspective? Come join me at www.LastBasic.com to see how we are doing our small part to accelerate change in the industry and how our model is pushing our clients into the modern age of product development.