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Innovation of Bang & Olufsen

Innovation of Bang & Olufsen






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    Innovation of Bang & Olufsen Innovation of Bang & Olufsen Presentation Transcript

    • Design Driven Innovation – Bang & Olufsen an HBS case, powerpoint by Wesley Shu, Ph.D.
    • Bang & Olufsen
      • You can watch a B&O TV for hours – and then you turn it on.
      • The product itself is ‘experience’ – Wesley Shu
    • 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
    • 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?
    • 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
    • Design Style
      • Influenced by Bauhaus and Scandinavian preference for clean lines
    • Bauhaus
    • Scandinavian clean-line
    • Scandinavian clean-line
    • 2001 strategy to overcome difficulties
      • Car stereo systems
      • Mobile phone
      • Hotel
      • Luxury yachts
    • 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
    • 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
    • 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
    • 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
    • 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
    • Who Are the Designer
      • A senior designer – British
      • 3 external designers
      • Competitions
      • Good designers have strong personality
      Making Ban & Olufsen Products
    • 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
    • Designer
      • Then, B&O attracts more talented designers.
      Making Ban & Olufsen Products
    • Process
      • No standard process for product design and development
      • Culturally evolved collaboration between designers, concept developers, engineers, and technicians
      Making Ban & Olufsen Products
    • Process
      • Close physical proximity to production departments
      • Thesis by designers – antithesis by engineers – synthesis : one or two years
      Making Ban & Olufsen Products
    • 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
    • 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
    • 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
    • Design – Prototyping
      • Idea iterates until it has ‘substance’ – unique personality
      Product Development Life Cycle
    • Prototypes – product commitment
      • Decision was made with the heart, not financial or technical considerations
      Product Development Life Cycle
    • 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
    • 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
    • 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
    • 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
    • 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
    • Some B&O Products
    • Some B&O Products BeoLab 5 Loudspeakers
    • Some B&O Products
    • Some B&O Products BeoVision 7 and BeoLab 8000
    • Some B&O Products
    • Some B&O Products BeoLab 3
    • Some B&O Products BeoCom 2