quality function deployment

Consumer Knows Best: Quirky Inc.

Posted on by matthew30111f14

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When it comes to buying things, the consumer knows best.  Quirky.com takes this need to understand the consumer to another level of crowd sourcing by allowing potential consumers in Quirky’s online community to submit ideas and their own input in order to develop innovations. There might not be a better way to identify what a consumer wants than what Quirky is doing by allowing consumers to actually create what they want. Some of the innovations they have created include the Pivot Power, a flexible surge protector, and Stem, a citrus spritzer. The most promising ideas every week are chosen by Quirky’s staff are then voted on by the online community and the employees at Quirky.com, where the top three to five ideas get to move on to development and later distribution.

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Quirky is set to record revenues of over $100 million dollars in 2014 after recording $48.7 million in 2013 and $18.2 million in 2012.  A lot of this revenue is created thanks to Quirky’s online community. Salim Ismail is the founding executive director of Singularity University, an educational organization and startup incubator in Silicon Valley, and he says that the online community has allowed Quirky to “scale very quickly” (Simon). At practically every stage of the product development stage, the online community is there with feedback such as on the style of the product or with their expertise in something like electrical engineering.

Inventors who get their product all the way up to development get 4% of revenue while there is an additional 6% that is split between the best feedbacks. It does not seem much but when you consider the starting costs for building a business around a single product to be around $200,000 just to do the paperwork and release a prototype, you might change your mind. There is also a lot of risk involved in getting into retail on your own when you do not have the contacts to get on the shelf, so Quirky would be a lot safer. For many people, like students and teachers, there is little risk and an immediate payoff if it works.  Jake Zein, inventor of the Pivot Power, got $28,000 in the first week of Pivot Power’s release after two years of being on Quirky. Now he has earned $696,343 as a result of his Pivot Power line.

Quirky has many competitive advantages under their business model. They get to keep the ideas that are voted into the development process. The company also avoids costs from the early design stages because of the online community’s validation as potential consumers. It helps as preordering allows recouping manufacturing costs to be a sure thing.

This company is set to grow. While most people do not always act on their innovations, Quirky can make the process a lot easier and less risky. Quirky’s mission to become a catalyst for innovation and it seems apparent to me that it will be.

Sites:

http://www.entrepreneur.com/article/220045

http://online.wsj.com/articles/one-week-3-000-product-ideas-1404332942

https://www.quirky.com/jakezien/summary

Questions

Do you have your own idea that you would like to be made?

Would you team up with Quirky, Shark Tank, or with your own team to get your innovation potentially made?

What do you think of crowd sourcing ideas and its effects?

 

Sound of the Evolution: Ear-itated No More.

Posted on by f1231malmail

“Can you hear me now?”

One word to describe Apple? Mine would be: Evolution. When taking any of their products into consideration, ask yourself this: When was the last time this product was updated? Probably not too long ago..

The trick with Apple is, that nothing is “too small” to change. Any change, no matter how seemingly incremental is done with purpose at Apple. This ranges from the bigger products such as laptops and tablets to the smaller, such as with their earphones. Considering there isn’t exactly a shortage of Operations-related Apple news on our blog site, what’s one more? Apple’s operations are so constantly in flux and evolving, there’s a lot to explore with their operations/products.

Shortly following the release of the iPhone 5, people were suddenly seeing a television commercial for the newly redesigned slick Apple earphones, now dubbed Earpods. The commercial effectively highlighted all the issues consumers had with the previous headphones incarnation, and explained how the new Earpods were designed for comfort, quality and sound transmission. While some might think this minor change to such a small product isn’t a big deal, the fact is that it actually is a big deal, especially from an operations standpoint.

Think back to product strategy options in chapter five’s Design of Goods and Services. When we think about Apple’s products and their constant changes and updates, this evolution technique of theirs is a clear example of the differentiation product strategy. Consider their aluminum laptops, iPad introduction, the iPod, the touchscreen smartphone and the App store. All of which revolutionized the electronic product industry, often imitated by competitors but never replicated. Apple effectively dominated their market because they introduced most of these product concepts, they wanted their products to have an edge that their competition lacked.

After the Earpods came to my attention, I read two articles on Wired and Engadget reviewing the Earpods and praising them for eliminating the problems that the older earphones had. Apple stated, “A breakthrough design for a more natural fit and increased durability, and an incredible acoustic quality typically reserved for higher-end earphones.” And they delivered. The sound is clearer, less rubber and metal, they feed sound comfortably on the edge of the ear canal, airflow and bass are sharper and they’re sleeker and conform to most ear shapes/sizes.

Operationally, when creating the Earpods Apple utilized Quality Function Deployment, wherein they identified customer wants and satisfied them. The Earpods differentiate in two ways, the first being that they’re physically/structurally very unique in appearance, sleek yet functional. The second is that they  retail for $29, the same as the old models. Not to mention, free with the iPhone 5 or new iPod. You get the quality of earphones that usually sell for $100+ but at the previous price. Apple listened to their customers and it paid off in satisfaction.

Where do you think? Do you think the Earphones are a testament to Apple’s evolution or is it an unnecessary change? Should Apple’s differentiation have a different target?