You often hear people complain about the pace of change in technology and how often their devices become obsolete. There are also the customers who want the latest tech, as soon as they can get it, damn the torpedoes! Manufacturers are often faced with having multiple generations of technology in their product lines at the same time and there is a constant pressure to stay current with the state of the art. Managing compatibility between generations so customers aren’t holding an orphaned product is a difficult but necessary part of managing your product line. Planning for a robust product line, product life cycle, and a future proof path for your customers is critical to your company’s survival. The history of technology is rife with examples of companies who made critical misjudgments or missteps, didn’t survive it, and left the early-adopters hanging.
This is the story of one of our products and it’s yet-unfinished journey to market.
Eighteen months ago, we demonstrated a new streaming audio product called the Vortex at a Trade Show in Chicago. We had identified a partner who could provide us with a key module containing a core technology that the product required. We designed a prototype of the product using this module and proudly demonstrated it at the Trade Show. It was well-publicized, well-received and we honestly believed that we were about 3–4 months from market launch. Returning from the show, we sat down to finalize our Licensing and Royalty agreement with the supplier and to our surprise, they tripled the cost of the module, the license, and the royalty fee. They clearly thought that we had our backs against the wall and would be forced to accept their terms. Doing some research, we discovered that they had pulled this stunt, mostly successfully, with some of our competitors. Since we’re fundamentally a bunch of grumpy curmudgeons, we tossed them out of our office and began to redesign the product using a different module. Commence the delays…
Very little of our core product design needed to change — mostly just the module interface hardware and some small software components. At the same time as all of this hardware drama was unfolding, we were also working on the software to incorporate the “next big thing” in software music formats. As we were working on this format, we rapidly realized that it A) did not fundamentally provide the promised benefits, and B) was really more of a subtle form of Digital Rights Management. Since a core philosophy of our company is to advance open standards, we decided to reject this new format. This led to a major redesign of the product’s core software, and more importantly, more delays.
So now we’re on Iteration 2 of the hardware and Iteration 2 of the software. At this point the product is delayed by about 9 months from its promised launch day. Customers are growing restless.
So now off we go again, and we develop a new core software, from scratch, that eliminates the closed ecosystem elements imposed by that rejected format. We write that code relatively quickly and begin testing it. For the most part, it works well, but there are a few pesky glitches. These glitches are very minor but glitches in an expensive audio product are a huge issue for customers expecting perfection - literal perfection. Eventually we discover that these glitches are a byproduct of the way we need the core module to function. As it turns out, we simply can’t get there from here. Sigh. Hello, third hardware redesign…
The good news is that the new core module is fundamentally self-contained and requires very little in the way of control or interaction by our core software. Finally, FINALLY, we are on a clear and short path to a product launch!
But not all is good news…
In the last 18 months, there has also been a subtle shift in the marketplace and in customer expectations. Fortunately, due to the delays, the issues we’ve endured developing this product, and the fact we were standing on the sidelines watching when the shift started, we’re actually in a good position to change all of our product designs to accommodate these market shifts, as well as being able to develop a stable platform on which to develop future products.
Thus, even though this has been a really painful journey, we’ve gotten to a really good “place” in terms of our ability to execute and deliver this product and our other new products.
So even though this journey has been slow, frustrating, expensive and painful, we learned a number of really good, hard lessons:
- Before you enter into any partnerships with any third-party technology vendor, thoroughly investigate how ethical and reliable the company actually is.
- Before you definitively select a third-party technology module, make sure that it will actually perform under your operating conditions.
- Negotiate your agreements, including pricing, before you publicly announce the product. If you don’t, you inadvertently give up your negotiation and pricing leverage with the supplier.
- Make sure you understand your market well enough that you can better predict coming market shifts. This can be really hard in rapidly-evolving technology areas but sometimes your company’s survival will depend on it!
- If you thoroughly understand your market, don’t be afraid to ignore the moves your competitors are making. Remember that, especially in markets where the customer base is evolving and technology is getting more advanced, your competitors may be poorly-equipped to accommodate and adapt to the changes. The moves they make could be based on blind panic, rather than sound strategy.
- Don’t announce anything about your new product until it’s about to go into production. Your sales and marketing people can work internally, or with a few trusted customers under an NDA to be ready for launch.
So sometimes, a company’s product development cycle may look and feel like Mr. Toad’s Wild Ride. This can be frustrating for customers, employees and management, not to mention investors, but by following your market carefully, and by developing rapid adaptation skills, you successfully navigate the rough seas of developing leading-edge products.
As for our new product or product, we ain’t talking! (See Number 6, above…)