IB Design and Technology People and Innovation

Types of Consumer 1.Technophile Someone who immediately welcomes technological change. 2.Technocautious Someone who needs some convincing before embracing technological change. 3.Technophobe Someone who resists all technological change.

Types of consumer The 3 broad groupings identified can be applied to most consumers. Under different sets of circumstances, people will conform more or less to each category. When deciding whether or not to embrace a technological change in your lifestyle, you will be influenced by first order and second order influences. For example, when deciding to buy a motor car people will way up the benefits of owning a car against the costs incurred and the environmental impact.

Corporate Inertia Research and development is a very expensive activity. Design projects often result in changes being required to manufacturing plant, equipment and processes. All of which incur large costs. In addition to this, innovation produces changes and disturb the “norm” and is often resisted by individuals within organisations. As a result of this large companies can take a long time to adapt to new practices, introduce new products or adopt innovations. This is known as corporate inertia and the length of time taken for the new aerosol spray nozzle, which we have looked at before, to reach production is a classic example of this.

Corporate Strategy Corporate strategy is the long term aims and objectives of a company and the ways of achieving them by the allocation of resources. Large companies will adopt some form of corporate strategy to innovation. These fall into one of two main areas – either pioneering or imitative.

The Pioneering Innovation Strategy Pioneering means being ahead of competitors by introducing a new product first. It is the most risky (and costly) strategy but one with the most potential for large gains.

A Pioneering company requires a strong research and development capability (R&D) which is expensive. Needs to be financially secure. Requires product champions to push new ideas. Good market research can often offset some risk, but is problematic for novel products.

The Sony Walkman TM With the introduction of the Walkman in the 1970s, Sony demonstrated themselves to be a pioneering company. They had a strong record of research and development leading to successful products. The success of previous products gave Sony a secure financial background allowing them to experiment with new innovations. Akio Morita was also a forceful product champion who was in a position to keep pushing the development forward.

The Imitative Strategy The imitative strategy aims to develop a product similar to the “pioneered” product as quickly as possible. It takes advantage of research and development invested by others and is less risky, but it is based on a strong development capability. Consider the range of products, similar to the Walkman, that are available now, and have been for a very short time after the Walkman first appeared.

Panasonic personal stereo Sanyo Personal stereos and miniature headphones allow listeners to enjoy recordings almost anywhere. Personal stereos are lightweight and inexpensive, but still deliver impressive sound quality. This system plays AM/FM radio and pre- recorded cassette tapes; other portable systems can play compact discs The imitative strategy

Pioneer or Imitate? What are the advantages and disadvantages of each strategy?

Market Penetration Increasing sales to existing customers or finding new customers for an existing product. The use of Biomass fuels produced by developing countries such as coconut oil used as car fuel in the Solomon islands needs new customers to increase sales.

How can a company enhance market penetration? Marketing. Brainstorm methods that could be used by the Solomon islands to enhance market penetration around the world.

Market Development Finding new applications for existing products, thereby opening up new markets. E.G. Nylon was originally developed for the making parachutes.

Product Development The creation of new, modified or updated products aimed mainly at existing customers. Adding variation to a product to develop a range of products built on an established design. E.g. Cadbury’s whole milk, Cadburys’ whole nut, fruit and nut.

Diversification Involves a company both in the development of new products and in selling those products to new companies. A company manufacturing 3 pin electrical plugs may consider producing them in a range of colours or from materials with different textures and/or material properties.

Market Sector and Market Segmentation A broad way of categorising the market the company is aiming for. Markets divided up into smaller segments where the purchasers have similar characteristics or preferences. Markets can be segmented by income, age, lifestyle, geographical location.

Robust Design and Product family Flexible designs that can be adapted to changing technical and market requirements. A group of products having common classification criteria. Members normally have common parts and assembly.

Task – Nokia are one of the world leaders of robust designs for mobile phones. Research 4 Nokia mobile phones that you consider belong to the product family including the N95 mobile (There’s a thing in my pocket!!!) What strategies were used to establish market penetration for each of the mobile phones. What market developments have taken place on each of the mobile phones e.g. the integration of the digital camera. What product developments have taken place with which target market in mind. Does the corporate business man have the same need as the teenager? Produce an A3 story board and PowerPoint to the rest of the group.