The Case for Improving the Design & Experience of Existing Products vs. Building New Products
I had a conversation with a colleague of mine a few months ago concerning aggressive release timelines within a certain organization. We talked about some of the giants in the technology industry such as Apple, Samsung and Microsoft. Each of these organizations finds a need to release new products in cyclical fashion to essentially keep stockholders happy and drive revenue. My position on this focused on releasing new products versus improving existing products and technologies (making them better or the best they can be). But, my colleague’s response surprised me. He asked if I liked getting paid. Of course, I responded, “yes.” He then went on to state, “Well in order to make more money and pay employees, organizations need to release new products.”
In essence, his argument was companies are able to become and remain successful through the release of new products. Those products drive revenue and afford growth or, at the very least, sustainability. This is partially true. But there is a bit of a logical fallacy herein. The argument assumes a binary stance wherein companies can only drive revenue and/or create sustainability through the release of new products. Not releasing new products results in a lack of growth and eventually will render an organization static.
While it is true a company must produce something in order to create revenue, the release cycle for new products and the number of products required to sustain an organization is what I questioned as I thought about this. My perspective is a little different. I would rather produce X number of products or services really well than X + Y number of products or services characterized as mediocre (even if the latter drives more revenue). I also think there is a fine line between the number of products produced that can be produced very well and the tipping point at which an organization is no longer able to sustain the level of quality for the products they produce. This fine line, of course, depends on numerous factors such as your labor force, operations management and market trends.
In Zeynep Ton’s book, The Good Jobs Strategy, she argues for a “less is more” strategy using examples of real organizations such as Quick Trip and In-N-Out Burger. Quick Trip carefully curates the number of products it offers customers opting for minimalism and focusing on what customers really need and buy. In-N-Out burger essentially offers a hamburger, cheeseburger, fries, shakes and soft drinks. That’s it. That is all they will make you and apparently they do it very well.
Offering fewer products has a number of benefits. Operation management and costs are more easily controlled and managed since there is less product (or product parts) to move across land or sea. There is less inventory to manage. Marketing and advertising shift to a more focused approach since there are less products to make a consumer aware of. But the benefit of offering less products I find most ideal is it allows an organization to simply focus on a smaller number of products continually refining them to perfection or near perfection. It also allows an organization to figure out and do what they do best. Steve Jobs famously gave Larry Page this same advice when Page assumed control of Google. He essentially told Page to figure out what he did best and focus on it.
In the example above concerning a company with aggressive release cycles, the company targets two releases per year. This is not an uncommon business model where the stockholders and investors are promised a new product in line with these releases. The problem is: The target becomes the release and not the product. So time often trumps the quality of the product with aggressive release cycles like this. But it is really all just smoke and mirrors because if the product is simply mediocre, the company will eventually feel market reverberations no matter how innovative the product might be. I suppose by the time that happens, a new product launch is in progress generating new excitement and shrouding the previous mediocre release.
A company could follow the above model and never really have to improve or refine a product. All they have to really do is adjust their advertising campaigns to focus on the next new thing and keep releasing mediocre products. But this road has to end somewhere.
Products often die or eventually fail as a result of neglect. The neglect begins in the design phase where not enough time is given to refinement or the goals are conflicting. A common conflict I often see is the difference in what marketing decides the product should be and what the designers and developers think the product should be. Marketing attempts to create a perceived or future need for a product while designers attempt to satisfy a need. This isn’t always true, but it is many times. The best organizations are able to manage and mitigate this gap in perception between the different organizational groups.
In an interview given after he had left Apple, Steve Jobs discussed how products become failures in technology-based organizations. His theory is many technology organizations go through phases in which they have little new technology to release or they have a monopoly on an industry (where new product releases won’t make much of a difference). In such environments, the only way to garner new customers is through marketing and advertising. And thus, he believed marketers and advertisers eventually come to drive some technology organizations – people who often do not have the customer’s best interest at heart and have little idea of what a truly great product looks like (his words, not mine).
There is probably a lot of truth in Jobs’ assessment. But I think complex problems can rarely be expressed in such simple terms. I see a number of competing problems within technology industries resulting in failed or mediocre products. The first and foremost is “market greed.” The perpetual desire to satisfy investors coupled with the “monkey see, monkey do” aspects of markets puts organizations into a pattern of releasing more products than they can aptly support.
In considering this, simply take a look at network TV. As soon as one channel develops a CSI or fairy tale TV show, another channel develops their version. This is a move of greed to steal a share of that market. Most of the time, the copycats don’t do it any better than the original (and usually the original isn’t really that good). They are simply producing more lower quality product. And this occurs in nearly any market – not just TV and entertainment.
Playing competitor catch-up is rarely a winning scenario. It is possible to improve on a product and not necessarily be the first. I wouldn’t consider this playing competitor catch-up though. The Japanese are famous for being able to take an innovation to a new level (like the TV, VCR, tape players). But often what we see in the market is simply a mediocre version of a competitor’s product, which wasn’t that good to begin with. It’s sort of like cheating off the kid who’s making a D in class.
In the process of playing catch-up or pursuing the almighty dollar, companies lose focus on what they do well. Sure, you can make phones, TVs, camera eyeglasses and websites. You can set up different arms of the organization to handle all of this – sort of like organizations within organizations. But eventually, such an endeavor will crumble under its own weight. Apple is beginning to head in that direction now with too many products. I love Apple products. But I really don’t need a phone on my wrist along with a regular phone, tablet, laptop and desktop system that all essentially do the same thing.
Focus is key. If you make burgers, concentrate on that and make the best damn burgers you can. My wife and I often go to restaurants with eclectic menus. For example, we’ll go to a pub-style restaurant and she’ll ask me if I want to split a pizza. My answer is always the same. Don’t go to a pub to get good pizza. Go to someplace that specializes in pizza. That’s where you’ll get a good pizza. So don’t order a burrito at a burger joint or sushi from Mexican restaurant.
These two problems, market greed and a lack of focus, ultimately lead to the last problem I see in many organizations – lack of refinement. This occurs as a result of having no focus or chasing the dollar. Both of these issues lead to aggressive release cycles, speeding products to market and understaffing.
It is fine to be agile and get a product to market. But, you have to put the time and effort into refining that product. I see a lot of organizations move to the next product as though they have conquered the previous product. The complexities of this problem are mind boggling. It is often a lack of vision for the product, lack of ownership or competing priorities among other things.
The more I think about this problem, the more it seems to simply be a matter of preference. Do you want to own an empire, in terms of a company, and build multiple products? Or do you want to own a specialty shop and focus on a niche?
So the argument for releasing new products to sustain and grow a business doesn’t really hold much water. And there are plenty of businesses who have realized this such as Quick Trip and In-N-Out burger. McDonalds recently scaled down their menu in an effort to control operations. Starbucks closed a large number of their stores in 2008 to control costs and focus on service over growth.
There is a lot of evidence for focus in business and product development. I fervently believe if a business concentrates on building the very best product on the market, the financial aspects of the business will pan out on their own.
At the end of the day, I think I would rather know I am building the best products I possibly can than simply diversifying.
Featured image courtesy of Craig Garner