Why technology driven product development is a dangerous idea.
Every product has two ways to be looked at: from the cost perspective or the income side. The first is looking at the production process while the latter is looking at the market where the product has to be sold. Technology is often on the cost side of things.
Which is why technology driven product development often goes astray.
Looking from a technology point of view we consider costs, risks, reproducibility and of course usability for the people that eventually use the product. But most of the time we lack the knowledge about the market. We don’t know if a feature might be necessary for marketing reasons or else.
Product development always needs a look at the people paying for the final output; at marketing, at uniqueness, at sponsorships, at advertisers and a whole lot more.
When product development lacks the second and is left to technology departments alone strange things might happen.
A friend of mine works for a big logistics service company. He shared some insights with me about a new product they have been developing.
The idea was simple: Build a transport box that can be tracked at any point of time, that is super secure and can not be easily stolen or opened in order to offer our clients the service of transporting i.e. their prototypes or technical papers and such.
Then the idea was left to technology and management went on to do something else.
After a few months the product was ready.
It was a box with GPS, time locks, secure codes and whatnot. That box was mounted to one of those euro palettes to allow easy transport on the usual carriers. Its walls were thick and heavy and possibly needed a large bomb to be opened by force. The client could order one put his stuff in their and lock it with his own pass phrases. He would have total control over it and some way to monitor the boxes whereabouts at all times.
It sounded perfect.
When you ignore the market reality…
That box was heavy and was therefor hard to handle. You needed to get it to the client, then the destination and then back to the hub. Extra costs in fuel were due just because of that weight. Monitoring technology had to be running at all times and to be maintained as well.
Also the ideal seaming idea to put it on a standard euro palette had a drawback as because of the thick walls and the technology inside the actual room for goods was quite small.
In the end the product was hypersafe. But the cost per kilo for transportation increased quite a bit to regular units.
I’m making the numbers up but it was about 100 Euro per kilogram for a 100 kilometers instead of the regular 20 Euro. Then again it’s super safe so clients will pay the price right?
They won’t. Because if we looked at the market for these kind of goods we would’ve seen that these security transport companies that use armoured vehicles and gun heavy staff would offer the same service. Transport would not be mixed with regular goods. The clients secret prototype could be larger than in our box and the price..
..was about 80 Euro per kg per km.
Exactly the same way you see websites being build with cool features and nice usability but no revenue.
Product development should always consider both perspectives: market first then costs. At all times.