Designing Products for Value

A rising tide of prosperity in developing economies is reshaping the nature of competition among global product makers, offering both the promise of new markets and the perils of having to face nimble, innovative, and highly ambitious rivals. In fact, the speed of newcomers (unencumbered by legacy issues) makes still more problematic an insidious challenge large manufacturers everywhere face when they try to innovate: insular thinking and functional disconnectedness that, if unchecked, can gum up product-development processes, drive up costs, and distract companies from paying attention to competitors—and, ultimately, customers.

Recognizing the challenges of the new environment, a few product makers in industries as varied as appliances, automotive, consumer packaged goods, high tech, and medical devices are taking a different approach. By encouraging more focused collaboration among multiple functional groups (notably marketing and sales, operations, engineering/R&D, and procurement), these leaders are combining deep insights about customers, competitors, and supply bases to strip out costs and amplify what customers truly value. The results—including better products, happier customers, higher margins, and, ultimately, a stronger ability to innovate—should serve these organizations well in years to come.

This article looks at three such companies. Their experiences offer insights for any product maker hoping to improve its competitiveness.

Read full article » www.mckinseyquarterly.com/Operations…

 

Image: Hand Holding Globe from Shutterstock.com

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