Download - Hypothesis Ashish Kaushik
-
8/22/2019 Hypothesis Ashish Kaushik
1/16
SYMBIOSIS INSTITUTE OF
MANAGEMENT STUDIES
HYPOTHESIS ON:TodayInnovation and corporate social responsibility
(CSR) drives growth in new product launch and
consumer products industry.
Under the guidance of Prof. V. V. Ramasastry
RESEARCH PAPER :- 1
SUBMITTED BY:DATE:19/01/2009
ASHISH KAUSHIKMARKS:
CLASS 1-A
COMMENTS:
ROLL NO. 08
-
8/22/2019 Hypothesis Ashish Kaushik
2/16
Introduction
Consumer products companies are under increasing pressure to reduce
time-to-market and the cost of introducing new products. As product
lifecycles continue to decrease, compressing development cycles and
accelerating new product introductions are becoming critical. Product
complexity is also increasing substantially, making development and
product introduction even more challenging. This report presents the
challenges the Consumer product industry is facing, as increased
complexities in the competitive environment are forcing shorter product
lifecycles and increasing cost pressures. It evaluates the impact that these
complexities have on the product development process and focuses on a
few recommendations that Consumer product executives should consider
to reduce their time-to-market and increase their return on investment for
new product introductions. This report is based on the challenges and
leading management practices associated with bringing new products and
services to market successfully and profitably. Leading consumer products
companies agree that the key to driving top-line growth is innovation.
Every consumer goods company is pursuing growth. As such,
effective innovation represents one of the greatest challenges.
To be truly effective you need to be able to create and execute
great new ideas, while protecting and developing the core
business at the same time
Alan Harris CMO, Kellogg
The present world is the customer oriented world. Here the customer is
the king and its the fundamental duty of any company or organization to
provide the customers the satisfaction which the customers want. In a
-
8/22/2019 Hypothesis Ashish Kaushik
3/16
nutshell, the organizational pyramid has just been inverted with the
customers and consumers on the top.
According to the marketing guru, Mr. Peter F Drucker, marketing and
innovation are the only two mantras of success in the present business
environment. In the present market scenario, the competition is so fierce
that the need gap is narrowing very fast. The competitors are trying their
best to get ahead of others either by price warfare or by technological
enhancement in the existing product or by introducing completely new
product. As Peter F Drucker said, in addition to the 4 fundament Ps of
marketing i.e., Product, Price, Place & Promotion, PACE is the fifth P
added to this list, especially in case of the launch of a new product.
To ensure the success of the new product not only innovation but the
pace in the development of the new and innovative product is also
necessary. It is true that always innovation is not necessary, but it is also
true that without innovation the company cannot grow and go ahead of
the competitors. Without innovation, the company can fight only in the
price front. Innovation is not just a clicked idea in the mind of a worker
and is immediately converted into the reality, but it is a very long process
which requires funds, patience and an extensive market research. This
takes long time. And due to the internal and external raw material supply
chain management, there is some delay in the project. This is one of the
crucial parts of any companys new venture. The marketing oriented
organizations are those organizations which never differentiate in what
have they said and what they are doing, but in specific time frame.
The importance of being first to market is discussed extensively in
various sources. Besides the instinctive idea that it is best to be first,
other measurable benefits are possible for those that get to the market
sooner with innovative products and services:
Increased sales through longer sales life The earlier the product
reaches the market, relative to the competition, the longer its life can be.
-
8/22/2019 Hypothesis Ashish Kaushik
4/16
Increased margins The more innovative the product (that is, the
longer it remains on the market with little or no competition), the longer
consumers will pay a premium purchase price.
Increased product loyalty Getting the first opportunity to attractcustomers, especially early adopters, offers an advantage in terms of
customer loyalty; customers will most likely upgrade, customize or
purchase companion products.
More resale opportunities For components, commodities or
products that other companies can private-label, being first to market can
often help ensure sales in other channels.
Greater market responsiveness The faster companies can bring
products to market that satisfy new or changing customer needs, the
greater the opportunity to capitalize on those products for margin lift and
to increase brand recognition.
A sustained leadership position Unlike best-selling, fastestor other
superlative market positions, firstis the market position a competitor
cannot take away. And repeated firsts establish companies as innovators
and leaders in the market.
-
8/22/2019 Hypothesis Ashish Kaushik
5/16
Clearly, quick product introduction is a competitive differentiator.
Accelerating time-to-market supports achievement of just about every
primary design, sales and marketing goal a company has (or should have)
in todays increasingly competitive, increasingly global marketplace. And
the challenge facing manufacturing organizations today is to continually
accelerate time-to market, while reducing development costs.
Successful innovation: The perfect product launch
Successful innovation has become a key driver for revenue growth,
competitive margins and, in some cases, even survival. The ability to
bring this innovation to market quickly, efficiently and ahead of
competition is becoming increasingly important. An efficient product
launch requires integration and coordination among multiple functional
areas, including product design, procurement, planning,
manufacturing/process and sales and marketing. In addition, as
organizations increasingly leverage core capabilities of other companies,
innovation has to be delivered through virtual networks, working with
-
8/22/2019 Hypothesis Ashish Kaushik
6/16
partners in a collaborative environment to bring product and services to
market faster, smarter and cheaper. Consequently, organizations now not
only need to integrate internally, but also externally with suppliers and
customers, creating end-to-end supply chain processes and capabilitieswhich differentiate on product and customer requirements.
Strategies for success
Launching products and services that best fit customer requirements is
clearly the top strategy for new product development. Lower introduction
costs and first-to-market strategies pale in comparison to bringing
innovative products to market that meet customers wants and needs (see
Figure 3).
In accordance with the primary strategy, correct identification of
customer needs is the most significant challenge for new product
development efforts for over half of the Consumer product respondents in
the Value Chain Study, directly followed by remaining competitive (see
Figure 4).
-
8/22/2019 Hypothesis Ashish Kaushik
7/16
Though best fit customer requirements and correct identification of
customer needs are Strategies for success but innovation cannot be left
behind as if you innovate without keeping in mind the customer needs
and wants then your product will not be a success, no matter how much
innovative your product is in the market, example: elephantine.
Below mentioned are various examples to prove and support
thatInnovation drives growth in the consumer products
industry and every company is driving towards innovation.
Apple iPhone
Innovation: Gee-whiz touch-screen interface and spartan case dial up a
mobile revolution.
Benefit: Mac os -simple software offering slide-and-glide access to bright,
colorful menus sets this cell phone apart from its rivals. The $399 iPhone
-
8/22/2019 Hypothesis Ashish Kaushik
8/16
has taken some criticism for its shortcomings, mainly its lack of 3G
connectivity, but you can't deny that the sleek handset is innovative.
Apple made navigating via a touch screen--sure to be a staple in future
PDA phones and other small devices--intuitive and fun. iPhone's Safaribrowser makes the handset a great mobile Web device (at least when you
can get a Wi-Fi connection.) And, sure, many phones play music, but
Cover Flow cranks the iPhone up to 11 as a music player.
Amazon Kindle
Innovation: Device takes the e-book to the next level with free EvDO
connectivity.
Benefit: Tight integration with Amazon's bookselling site; thoughtfuldesign. Electronic-book readers are not new, and Sony's experience withits Reader shows that sales are not guaranteed. But with its Kindle reader($400), Amazon has brought the e-book into the connected age by
including free EvDO wireless connectivity to the e-commerce giant.
IO Gear Wireless USB Hub and Adapter
http://www.pcworld.com/article/id,133639/article.htmlhttp://www.pcworld.com/tags/Apple+Safari.htmlhttp://www.pcworld.com/tags/Apple+Safari.htmlhttp://www.pcworld.com/tags/Sony+Corporation.htmlhttp://www.pcworld.com/article/id,139829/article.htmlhttp://www.pcworld.com/zoom?id=140663&page=1&zoomIdx=5http://www.pcworld.com/tags/Apple+Safari.htmlhttp://www.pcworld.com/tags/Apple+Safari.htmlhttp://www.pcworld.com/tags/Sony+Corporation.htmlhttp://www.pcworld.com/article/id,139829/article.htmlhttp://www.pcworld.com/article/id,133639/article.html -
8/22/2019 Hypothesis Ashish Kaushik
9/16
Innovation: USB-speed connections without cable spaghetti.
Benefit: Presents none of the flakiness and proprietary technology that
hobbled previous wireless USB products.
IO Gear's hub and adapter are based on an industry standard that should
soon be built into laptops and other devices. Setting up IOGear's Wireless
USB Hub and Adapter ($160) was tricky, but once we had everything
arranged, our data flew, thanks to its streaming, HD-capable, 250-
megabits-per-second throughput. Wireless USB will become more
versatile once it's built into devices.
Kodak EasyShare All-In-One Printers
Innovation: The printers are slightly more expensive, but their ink is
priced more like the no- name stuff advertised around the Web.
.
http://www.pcworld.com/article/id,138190/article.htmlhttp://www.pcworld.com/article/id,138190/article.htmlhttp://www.pcworld.com/zoom?id=140663&page=5&zoomIdx=3http://www.pcworld.com/zoom?id=140663&page=4&zoomIdx=3http://www.pcworld.com/article/id,138190/article.htmlhttp://www.pcworld.com/article/id,138190/article.html -
8/22/2019 Hypothesis Ashish Kaushik
10/16
Benefit: You can print cheaply without worrying that the cartridge will
burst all over your printer. Kodak's midlevel EasyShare printers (from
$150) may be a bit pricier at first. But when you combine one with the
company's paper-and-ink packs, you can print photos for as little as 10cents each (according to Kodak)--about half the industry average. The
printer's pigment-ink system uses one black-ink cartridge and one five-ink
tank; replacing them with non-photo-specific inks directly from Kodak
costs just $10 and $15, respectively. We think most people will appreciate
the benefit of having one source for affordable, reliable replacement ink
cartridges.
Bajaj Pulsar, DTSi and its variants
Bajaj pulsar DTSi is one of the best examples for the pace and innovation
in the new product. DTSi was the one of its own kind of technology used
by Bajaj which means Digital Twin Spark Ignition which enhances the
mileage of the bike and also increases the speed pick up and
performance. Going back to the history, when Hero Honda CBZ was in the
market, Bajaj launched its product Pulsar in competition of CBZ in very
short time. Its ultimate physical appeal immediately gained popularity.
Then after that within 2 years, Bajaj came up DTS i model of pulsar.
Here are some of the innovations in Pulsar:
1. The Pulsar motorcycle variety, just like any other Indian motorcycle
in early 2000s, implements an air-cooled, single cylinder, gasoline
powered, spark-ignited four-stroke engine. The early product
offerings under the Pulsar brand name featured a single spark plug
to ignite the air-fuel mixture fed from a carburetor, simple spring
damper shock absorbers, round headlamp dome and a short
wheelbase.
http://www.pcworld.com/article/id,131888-page,1-c,printers/article.htmlhttp://www.pcworld.com/tags/Eastman+Kodak+Company.htmlhttp://www.pcworld.com/article/id,131888-page,1-c,printers/article.htmlhttp://www.pcworld.com/tags/Eastman+Kodak+Company.html -
8/22/2019 Hypothesis Ashish Kaushik
11/16
2. DTSi - a second generation Pulsar feature: Bajaj Auto decided
to upgrade a few components on the motorbike and rolled out the
second generation Pulsar twins. They would feature Bajaj Auto's so
called "DTSi" technology. Bajaj Auto claims that they are in theprocess of obtaining a patent for DTSi.
3. ExhausTEC - a second generation Pulsar feature: The second
version Pulsars also featured "ExhausTEC" systems. Similar to DTSi,
Bajaj Auto is in the process of obtaining a patent for this technology.
ExhausTEC stands for Exhaust Torque Expansion Chamber. The
design of engine exhaust system, as per Bajaj's claims on their
website, improves torque delivery at low engine speeds.
Eco-Design of Products(CSR)
Eco-design means starting off right: Creating products out of
environmentally friendly materials, using efficient designs that require
fewer materials, and maximizing reusability and recyclability. Some
practices in the consumer electronics industry already bring about the
result of lower environmental impact. Some of the examples of the
companies who have innovated in its product are:-
Seiko Epson takes into account the entire life cycle of its printers and
other products while they are still in the design phase, earning the
company 13 eco-design awards in two years. For instance, it has created
its own database of the environmental impacts of chemicals, established
quantitative metrics of businesses impact on society, and designed its
own labelling system called Eco Leaf. Epson makes its packaging out of
trees specifically grown for that purpose, and plants 20% more trees than
are consumed. Each product comes with a full Ecology Profile that
-
8/22/2019 Hypothesis Ashish Kaushik
12/16
includes recycling information about every component. Printer product
components are also 85% recoverable.
The European Unions Restriction of Hazardous Substances (RoHS)
directive went into effect in July 2006, limiting the usage of five classes of
materials. Even prior to this directive, Nokia had decided to voluntarily
omit certain compounds from its products because their safety to human
health and the environment was in question. Nokias design-for-environment engineers worked with the environmental department to
remove about 225 additional substances from the companys products.
In a brilliant example of the cycle of value, Lenovo is driving the use of
post-consumer recycled material in its products. This recycled material is
designed inmeaning that the company moves from this fifth
sustainability practice back the first! And the cycle repeats.
Lenovos EPEAT Gold monitors have over 25% recycled material in them,
and this is increasing with the design of each new product. All of Lenovos
product lines use recycled plastic and metals; the gold, silver and other
precious metals are recovered from end-of-life products. Using specifically
postconsumer material has become a keen focus this year for Lenovo and
is an effective differentiator in the market for the company.
Energy Efficiency of Products(CSR)
Products designed to be energy-efficient use less electricity from outlets
or run longer before needing recharging or new batteries. This efficiency
-
8/22/2019 Hypothesis Ashish Kaushik
13/16
reduces greenhouse gas emissions and hazardous waste and saves
money. As there is increasing awareness of the consumers companies
have to innovate newer products to meet the requirements of the
consumers so as to be in the market and increase their success andprofits.
Intels new microprocessors use nearly 10 times less power than models
from just 18 months ago. The Core 2 Duo processor uses 40% less
energy to do 40% more work than the previous Pentium processor. The
total energy savings from all the Core 2 Duo products in the marketplace
is equivalent to taking millions of cars off the road. And the newer Xeon
processor gives another 3560% efficiency gain over previous products.
Intel also works to improve the energy efficiency of business data centres,
which combine many processors.
Its Eco-Rack design reduces power consumption by 1618%, which, if it
were used by all servers and data centres in the United States, would save
the equivalent of the energy used by 986,000 homes. Each Eco-Racksaves about $44,000 in electricity costs. Intel provides employee
incentives for innovations in energy efficiency: Bonuses are tied to
efficiency milestones, and the Intel Environmental Excellence Award
recognizes highly innovative projects.
Lenovo understands its
customers interest in energy savings and has stepped ahead of the
curve. A few years ago, people were satisfied to replace their bulky CRTs
with flat panel monitors, which use half to two-thirds as much energy. But
Lenovo goes on to ask how efficient the flat panel can be. Its monitors are
up to 33% more efficient than other flat panels on the market. And the
company is leading innovations in light-emitting-diode (LED) backlights,
which use up to 75% less energy than standard fluorescent backlights
(while also improving the colour and brightness uniformity).
-
8/22/2019 Hypothesis Ashish Kaushik
14/16
Electricity is consumed by mobile phone chargers that are left plugged in
after the phone is charged (no-load energy use). Over the last nine
years, Nokia has reduced the amount of no-load energy in its best-in-class
chargers by 90%. Nokias newest chargers go even farther, using up to
94% less energy than the ENERGY STAR requirements in the United
States, and also meet the highest European Union standards. In May
2007, Nokia became the first mobile manufacturer to put alerts into
phones, encouraging people to unplug their chargers. The energy that
could be saved globally if all Nokia phone users unplugged their chargers
when not in use would power 100,000 average-size European homes.
Conclusion
Consumer product executives realize that business performance and
growth are directly related to their ability to bring superior products and
services to market in a cost-effective manner. In this report, i have shown
that:
1. High levels of competition, shorter product lifecycles and changing
market conditions intensify pressures on Consumer product growth.
2. To meet their business targets, Consumer product companies need
new ways to deliver value to their customers.
3. Innovation is dependent on the introduction of new products and
services to existing markets, while expanding new market channels and
geographies.
4. Reducing time-to-market is a key success factor.
5. CP companies have not yet significantly improved their time-to-market
and on-budget performance.
-
8/22/2019 Hypothesis Ashish Kaushik
15/16
6. To help shorten time-to-market while reducing development costs,
companies should adopt a holistic view of the development process and
involve stakeholders from outside the immediate scope of the process,
such as contract manufacturers, suppliers and other service providers.
7. Implementation of point solutions aimed at reducing time-to-market
might achieve only local improvements, and not provide widespread
business benefits. New product development objectives and initiatives
must be tied to corporate strategies.
8. One of the most critical strategic initiatives in new product introduction
is: acquiring an explicit definition of customers requirements, in
collaboration and communication with customers not in an R&D vacuum.
9. Use of componentization and standards to develop variations on
products can help companies achieve faster-to-market objectives at
lower costs.
Companies also give back to society, creating a cycle of value that
contributes to global sustainability. A corporations giving-back program
can help to protect and restore the environment we all share. Some of the
main avenues for social responsibility are direct giving, social programs,
or other responsible business practices. At Intel, for instance, 3840% of
employees worldwide do volunteer work at non-profit organizations, to the
tune of nearly 1 million hours per year. In many cases, Intel pays the non-
profit $10 per hour through a company matching program. Panasonics
employees participate in Walk America, benefiting the March of Dimes,
and have raised approximately $450,000 for this cause. And in Mexico, 61
HP employees planted 600 trees as part of a reforestation project. Formal
corporate social responsibility (CSR) programs have existed for many
years; recently a number of new developments have occurred. CSR now
often includes explicit environmental goals, far beyond compliance with
regulations. In addition, philanthropic efforts have taken on a more
strategic flavour. For example, several companies offer health care
-
8/22/2019 Hypothesis Ashish Kaushik
16/16
assistance in rural villages where their factory workers live, which helps
people and also creates a healthy workforce. It is also worth noting that
nearly all major consumer electronics companies have a dedicated section
on their website with information on environmental and social benefitprograms. In these ways, CSR is seen not purely as an extra, but as a
more integral part of operations and communications.
From the above mentioned facts and study report it is clear that if a
company wants to succeed and make successful product launch it has to
do both innovation and CSR for its customer as today customer base has
become more aware and environment friendly.