Monday, January 30, 2012

Why Portland's Public Toilets Succeeded Where Others Failed

The city of Portland, OR has taken the outdoor, public restroom to the next level.  As most people who have used public restrooms of any sort can attest, most have been vandalized in some way or another.  Whether that means graffiti on the walls, smashed mirrors, or various other items being destroyed public restrooms commonly come under attack.  Because of this the city of Portland, OR decided to design a public restroom that was more or less impervious to vandalism by removing most of the modern frills.  The city has patented the design and is currently in the process of selling these restrooms to other municipalities.

Check it out!

Sunday, January 29, 2012

A.G. Lafley vs. Steve Jobs

I thought this article was very relevant to some of the discussions that we have been having in class, as well as, reinforcing some of the reading material. It discusses how the CEO of Proctor and Gamble, A.G. Lafley, spent a great deal of time trying to understand the target market while, on the other hand, Steve Jobs, Apple's CEO, was infamous for saying that "it isn't the customer's job to know what they want." 

In the end both men came to the conclusion that in order to be sucessful you need to understand your customer better than they understand themselves. This also allows you to stay ahead of the curve and introduce new and innovative products ahead of when a customer might initially need them.

Like A.G. Lafley Cleveland based Nottingham Spirk Strategic Innovation uses the power of observation to seek out new and innovative ideas.  Nottingham Spirk is housed in a "state-of-the-art facility known as the Nottingham Spirk Innovation Center, where researchers, product designers, engineers and prototype technicians work side by side through every step of the company’s unique, vertically integrated open innovation process, developing products that change the game in their respective markets."  Employees of Nottingham Spirk often wonder the aisles of major chains to see the products that currently exist and then come up with innovative ways of improving those products.

Is there a first-mover advantage?

A first-mover is defined as the first significant occupant of a market segment.  The advantages of being the first person/group to enter a particular market segment are many.
  • No competition - by definition you have created a market that did not previously exist and therefore for at least the initial stages have no competition.  Assuming the market that was created thrives it will only take so long before the fast-followers catch on and try to move in.
  • Control the technology - if the product or process is innovative enough then the first-mover will gain control of the intellectual property (IP) and can establish patents that will last for 20 years.  This will make it tough for others to quickly gain a competitive advantage.
  • Set the rules for the game - The first mover also has the ability to set the rules for the game so that any competition that arises will have to play by those rules.  
  • Ability to acquire assets for less money - First-movers can capitalize on low demand for supplies to get them at a cheaper rate.  After the market has been established for awhile and as competition moves in these prices will increase as demand for the same supplies increases.
Unfortunately, there are also some disadvantages to being the first-mover.

  • No established market segment - Because the first-mover establishes a completely new market segment they must deal with the risks associated with this.  The financial penalties associated with entering a previously unestablished market can be significant.
  • Room for improvement - Unless the first-mover enters the market with a product that meets all of the customer needs right from the start they are leaving themselves open for competition to enter the market with a product that is superior to their's.
  • Complacency - The first-mover should be aware to not rest on the success of their accomplishments and must continue to strive to improve their product for fear that competition will arrive and overtake them.
Coca-Cola and eBay are examples of first-movers and they cornered the market in cola beverages and online auctions respectively for a while before competition could enter.  Fortunately, for both the competition was not able to take away from their competitive advantages.

With the iPod Apple was a fast-follower.  Other MP3 players existed at the time when Apple introduced the iPod, but Apple was able to surpass them by making significant improvement to the product.  Having had a Diamond Rio 600 MP3 player that had 32MB of storage I can attest to the significant leap that Apple was able to make with the iPod which allowed users to store 1,000 songs.  I quickly switched to the iPod and haven't looked back since.

In the end I would say that unless the first-mover is able to deliver a product that meets all of the customers' needs and upon which little improvement can be made, then they have left the door open for the fast-follower.  The first-mover takes all of the risk in establishing a previously non-existent market.  The fast-follower can capitalize on this and in the door is open, move in and create a better product and thus nullify any advantage that the first-mover gained.

Saturday, January 28, 2012

Why would-be engineers end up as English majors

This article was on back in May, but I thought I would bring it up as it directly relates to my previous post regarding engineering jobs being sent over seas.  The article discusses the dropout rates of young people entering the math and science fields in college, and compares them to the dropout rates of other majors such as the liberal arts or business.  According to the data presented in this article dropout rates for students pursuing math and science degrees are much higher.

As someone who graduated with a B.S. in Mechanical Engineering from the University of Massachusetts I can relate to this article, but also found a couple of their arguments to be somewhat flawed.  It seems to blame the lack of quality teaching as a reason for the higher dropout rates.  My Freshman engineering classes had about 120 students in them and by Senior year these same classes were down to about 40 students.  66% of my original classmates had disappeared.  Ironically this is exactly what one of my Freshman engineering professors had predicted.  Before passing back an exam he told the class to "look to your left and then look to you right.  Chances are those people want be there when you graduate in 4 years."  However, I don't blame this high dropout rate on teaching.  I found most of my professors to be readily accesible and approachable.  Instead I look to the myriad of other options that college students have.

Engineering is one of the least appealing majors because of the large amount of time and effort required to complete the degree.  There were many times when I would look out my dorm room window to see other students playing frisbee or whiffle ball in the quad while I was doing statics, thermo, or materials homework.  To become an engineer you have to want it.  There are definitely sacrifices that have to be made, and I don't think enough talented people are willing to make them.  College has become more about the party and the other social aspects than graduating with a degree that will be useful for years to come.

Wednesday, January 25, 2012

How the U.S. Lost Out on iPhone Work

How the U.S. Lost Out on iPhone Work is an article that was in the New York Times this past Sunday (1/22/12). As most Americans have become acutely aware, the level of manufacturing in this country continues to decline and many American companies, Apple included, now manufacture the bulk of their products overseas. China in particular has become a hotbed location for the assembly of consumer electronics goods. The following is a quote which basically sums up the article.

"Another critical advantage for Apple was that China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States. In China, it took 15 days."

As a young engineer in this country it is always discouraging to read and hear of jobs being sent overseas, but unfortunately engineering is not revered as a glamorous major despite the fact that jobs in math and science are higher paying and more readily available.

Nice Quote from Steve Jobs

“Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on.” - Steve Jobs