Monday, February 2, 2009

Killer Question - Could you customize a mass product?

"When things get tough, the common reaction is to scale back and standardize the processes.  The objective is to take costs out of the business.  What would happened if you went the opposite direction?  Rather than standardize, why not customize?"

This is an interesting question for me, since my company mass produces a product that is "customizable" by our customers through software configuration.  This isn't really an aftermarket for our product, since the product isn't immediately useful in it's default state.

But if I had to think about ways that our product could be customized, the list might look something like this:
  1. We could allow customers to upload specific configuration options to their order, and we'd load those before the product was shipped.  This might make it easier for them to deploy the products in remote offices without sending a specialized technician to the site.
  2. While it wouldn't enhance the functionality of the product, we could offer options on the color of the faceplates on the products.  Some companies have corporate colors (ie. Yahoo - purple, UPS - brown, Wake Forest - black/gold) and this might be a desirable look in their data centers.  
  3. if our selling partners identified their primary target markets, we could potentially create collateral (training, co-logo'd whitepapers, etc.) that aligned with those segments.  This would reduce their costs and increase their focus, and we could probably do it with minimal additional costs.
This is an interesting exercise, because while some these ideas could change the overall experience, they also introduce additional conflicts or problems (distribution, etc.).  I need to think about this some more, to see if there aren't more obvious or impactful ways this could be applied to my company.  I may find that this exercise works better for new companies looking to create a niche (or adjacency) to an existing market, rather than trying to change an existing product/service mix.

2 comments:

Chris said...

It would be interesting to study how Toyota does this, they have a longer list of ala carte options than many of their competitors (namely Honda). I would guess that if you are building on a nimble enough production platform (ie just in time delivery, minimal inventory etc) its not a big cost to offer 4 styles of aluminum rims.
I would also think that a business today needs to be of a critical mass to pull this off. Contract manufacturers charge a fortune for low volume runs and without significant volume (and negotiating power :-) customizations would probably get much harder.

Brian Gracely said...

Chris,

These are good points. The example Phil McKinney uses in his blog is West Coast Choppers, who build custom motorcycles. Their volume isn't high (one shop, about 10 people). So what I'm not exactly sure is if the question is best answered as a flexible platform (as you mention), or if it's an adjacency to an existing market. Either way, I think one of the points that Phil stresses is to get outside your comfort zone in how you think about the question. Look at it from angles that aren't comfortable for you.