We are heading to the 5th session of the Consumer Channel Dynamics seminar and I think that we all have a clear idea of mass customization. During lectures, presentations and after having read so many articles.. we have come across many examples of companies applying mass customization!
I noticed the web-site of “Interflora”, a flower delivery network-company that gives customers the opportunity to design their own floral gift. The whole process is comprised of 5 steps;
1. The customer has to select the recipient of the gift and the occasion for sending it,
2. Select the style of the floral gift,
3. The flowers’ color,
4. The amount of money he is willing to pay,
5. The recipient’s details (address, phone number etc.).
I believe that the specific example is different from what we have explored so far.
I hope you will enjoy it! http://www.interflora.co.uk/design/
Since the period of Henry Ford’s car industry until late 90’s, product efficiency requires mass production. Companies were using labor divisions, standarisation and automated processes to create products in large quantities. Economies of scale insists emphasising on mass production since it reduces cost massively. Industries rely on mass production to minimise costs. One example of mass production in car industry is Ford model T.
Ford model T – The first car that was mass produced.
However, new technologies such as CAD (Computer Aided Design) and CAM (Computer Aided Manufacturing) are damaging the economy of mass production. Since both allow mass customisation towards the needs of customer. Mass customisation includes flexible production process to create goods and services that are intertwined with each customer. The future of manufacturing was actually started with mass customisation.
Mass customisation offers advantages for both customers and factories. Customers can get the product they want, based with their tastes and needs. For the factory, they create more customer satisfaction, at the same time, improve production efficiency. In some industries, mass customisation method may result in little or no inventory of finished goods or semi-finished, no expired products are full of dust on a shelf or showroom; and require less working capital.
However, there are several weaknesses of mass customisation that I found:
For me it was obvious that Apple was placed on #1 and Facebook was in the top 5 as well. The most surprising company is Nissan. But after some research I found out that they focus on the new way of dealing with the environment: be as sustainable as possible. They still work with closed innovation, with their own knowledge. The other firms are more open innovators.
My post about the open innovation pitfalls stated that companies move towards open innovation. Obviously not all companies move towards open innovation, even though they want to meet the expectations of the customers.On one hand you can say Nissan is doing very good with their innovation, because they are placed number 4. On the other hand if you look at the sales within the Netherlands in 2011, they can not be found within the top 10 (http://www.autozine.nl/enquete_verkoop.html). So this might rise the question: when you innovate as a firm, is it necessary to listen to your customers? Thus use a way of open innovation?
During the last class (Monday January 16th in the morning class) we discussed about the open innovation after the Lays ‘Maak je Smaak’ case. Open innovation has some pitfalls. In the article below you can read about these pitfalls.
I found this article on a Dutch website, so I translated into English. It is about crowdcasting: “Crowdcasting is a problem-solving and idea-generating tactic in which a corporation disseminates details of a specific problem or situation to a carefully chosen group of people for possible solutions. The process is often conducted as a contest. The results may be used to resolve difficult or complex development and marketing issues.”( http://searchcrm.techtarget.com/definition/crowdcasting)
Innovation is for many organisation the keyword of success. The definition is used a lot, but most of the times people do not understand it. Research showed that the biggest successes can be achieved when using open innovation with the help of consumers and other companies. Sometimes it does succeed, sometimes it does not. How is this possible? Below the three most common pitfalls of crowdcasting will be dealt with, crowdcasting is a very popular way of open innovation.
In the world where we live everything must be faster, better and newer. Companies have to innovate and develop products/services faster then ever. With this challenge companies need to think different.
Open innovation is a new way of integrating customers during the research and design period of the firm. This picture below is a simple example of how open innovation works. Because of the new method, firms can choice between the traditional approaches or the new open approaches. The differences between these methods are showed in the table below.
I found a very interesting video in which Matthew Guiste, director of global social media at Starbucks talking about open innovation and social media. Specifically he is talking about MyStarbucksIdea.com generating around 100.000 ideas for new products and business improvements. It is good to see this video because it describes most of the things that we learn in class, actually how all these things are applied in a real company.
Yes, I am a relatively late adopter of everything there is on the Internet, nor am I an enthusiast of creating my own things on-line even though I am starting to be more comfortable with the idea. And while we talk in class about designing your own shoes, and make your own T-shirt and Greeting Card etc. and customization of all sorts I’m thinking why do people need to do that? when there are designer and real creative people that will do it a million times better than us. For me the challenge is to find those people 🙂 ..(just a little thought)
I thought it was a nice example to complement the topic for the UnMe Jeans and the Web 2.0, and also just and interesting article to see how luxury brands are integrating social media and engaging with customers. and especially how the traditional definition of luxury had to radically change in the last couple of years.