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Innovation of Bang & Olufsen
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Innovation of Bang & Olufsen


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  • 1. Design Driven Innovation – Bang & Olufsen an HBS case, powerpoint by Wesley Shu, Ph.D.
  • 2. Bang & Olufsen
    • You can watch a B&O TV for hours – and then you turn it on.
    • The product itself is ‘experience’ – Wesley Shu
  • 3. Issue
    • Impact of iPod : extend into virtual space, not only physical form or function
    • Extend to virtual space, where great design meant great software and network-based interaction with other products and services
  • 4. Issue
    • This differed from B&O’s traditional expertise
    • The company formed Idealab
    • “ supplementary innovation” – a way of injecting new ideas into products from outside the traditional process
    • Move away from designers’ near absolute control over products
    • But how to decide the ‘right’ amount of change?
  • 5. Survived from Asian competition 1960s
    • By allying with a group of architects & designers
    • By focusing on ideas and design behind its products
    • Emphasizing high quality
  • 6. Design Style
    • Influenced by Bauhaus and Scandinavian preference for clean lines
  • 7. Bauhaus
  • 8. Scandinavian clean-line
  • 9. Scandinavian clean-line
  • 10. 2001 strategy to overcome difficulties
    • Car stereo systems
    • Mobile phone
    • Hotel
    • Luxury yachts
  • 11. Vision (mission?) Statement
    • Courage to constantly question the ordinary in search of surprising, long lasting experiences
    • For Bang & Olufsen, design is far more than mere styling of existing products; rather it is the expression of an idea, the concept made conscious
    Business Model
  • 12. Self Position
    • “ We see competition more in the recreational car or home, high-end furniture or luxury travel… We relate more to a BMW than to the generic product ranges of electronics giants.”
    • Very hard to imitate – technology and material to support the unique design (cf. Philip, Fisher)
    Business Model
  • 13. Customer
    • Vital core customers
    • 80% revenue came from 800 to 1,000 customers in the U.S.
    • Customer relations are important – CRM.
    • Not only design, but the way the product works
    Business Model
  • 14. Designer – never in-house!
    • Away from the influence of its daily business
    • Not need to understand their industrial limitations, e.g., manufacturability
    Making Ban & Olufsen Products
  • 15. Designer – never in-house!
    • “ Designers have to be free to look in an unconditioned way at what’s happening in our society, how people live and furnish their homes…”
    Making Ban & Olufsen Products
  • 16. Who Are the Designer
    • A senior designer – British
    • 3 external designers
    • Competitions
    • Good designers have strong personality
    Making Ban & Olufsen Products
  • 17. Design Competition
    • “ When flat screen TVs started to take off, B&O launched a competition among nine designers from different parts of the world for ideas on what the B&O flat screen concept should be.”
    Making Bang & Olufsen Products
  • 18. Designer
    • Then, B&O attracts more talented designers.
    Making Ban & Olufsen Products
  • 19. Process
    • No standard process for product design and development
    • Culturally evolved collaboration between designers, concept developers, engineers, and technicians
    Making Ban & Olufsen Products
  • 20. Process
    • Close physical proximity to production departments
    • Thesis by designers – antithesis by engineers – synthesis : one or two years
    Making Ban & Olufsen Products
  • 21. Concept Developers
    • Bridge art towards the repetitive processes of an efficient industrialized manufacturing process
    • Constantly question the ordinary
    • Give hard time to manufacturing guys
    Making Ban & Olufsen Products
  • 22. Coming up with new ideas
    • From designers
    • From engineers – new technology inspiring designers
    • From perceived needs to fill out the product portfolio
    Making Ban & Olufsen Products
  • 23. Ideas from designers
    • See how customers live, not ask what they want.
    • Customers only know what’s already hot in the market.
    • Go beyond customer expectation
    Making Ban & Olufsen Products
  • 24. Design – Prototyping
    • Idea iterates until it has ‘substance’ – unique personality
    Product Development Life Cycle
  • 25. Prototypes – product commitment
    • Decision was made with the heart, not financial or technical considerations
    Product Development Life Cycle
  • 26. Product commitment – development
    • A dedicated project team formed
    • Designers remained involved
    • Concepts or development process may change if a convincing new idea comes up.
    Product Development Life Cycle
  • 27. Some Products
    • BeoSound 9000
      • originally unmanufacturable
      • Took 5 years from the decision point to manufacturing
    • BeoLab 8000
      • Originally a crazy idea
    • BeoCom 2
      • New technology & material to support design, e.g., hydroforming used by Porsche
    Product Development Life Cycle
  • 28. Conclusion
    • “ If you wanted to express power and determination as a manager here, it would be difficult, but if you allow a certain degree of freedom you get a very creative environment.”
    Product Development Life Cycle
  • 29. IdeaLab – B&O’s effort to digital world
    • Goal: untapped or uncontested markets, network economy, media convergence (is iPod one?)
    • The most challenging part is how to integrate into existing business environment
  • 30. Effort to integrate
    • Find the way to communicate
    • Follow existing way of communication
    • Collocate chief graphic designer with concept developers at IdeaLand
    • Demo facility without pushing designers to visit
    • Supplementary functionality for existing products
    • Patience! Usually took longer than anticipate
  • 31. Some B&O Products
  • 32. Some B&O Products BeoLab 5 Loudspeakers
  • 33. Some B&O Products
  • 34. Some B&O Products BeoVision 7 and BeoLab 8000
  • 35. Some B&O Products
  • 36. Some B&O Products BeoLab 3
  • 37. Some B&O Products BeoCom 2
  • 38.