Talk about taking open innovation to new heights! This was an amazing piece in which I learned quite a bit about this firm’s use of open innovation as a means of value creation and competitive differentiation in an industry where the last truest innovations (to my knowledge) are 3D printing (as you identified with Adidas and Nike) and fast fashion supply chain efficiencies. I would have never envisioned this approach to product development to be possible due to limitations in production speed. The retail industry has long believed that “fashion-forward” designers are the crown sources of what is fashionable and what is not. Betabrand flipped this model on its head and grants the power to the customer who ultimately uses the products they manufacture. What better way at predicting demand than by asking those what they want, and what quantities? Genius.
I do not believe that this use of open innovation will alienate its base since the buzz created in user-generated and user-voted design process builds strong customer loyalty for the business. Consumers will be engaged in the community that Betabrands has created, in a similar way that Indiegogo and Kickstarter have created communities that look forward to and supports entrepreneurs.
I think you hit the nail on the head on the split created by the spread of 3-D printing at Adidas:” mass production or mass customization”? Customer reaction, which is difficult to gauge until after the fact, will really determine the success of this technology. What we can agree on with its partnership with Carbon, it grants the firm more flexibility in volume sizes which the inject moulding did not truly grant for its business as they are completed in batches. I think to appreciate this new form of manufacturing not only as a customization play, but as a flexibility play in its output – many more benefits would be granted to Adidas such as the ability to make adjustments to match changes in customer preferences. I thought of Zara’s dominance in fast-fashion (https://hbswk.hbs.edu/archive/zara-s-secret-for-fast-fashion) that the company gained by increasing its supply-chain efficiencies – potentially giving Adidas similar benefits to respond to customer interests potentially in real-time and in-store as you alluded to in your closing remarks.
Thoughtful piece on how one of the technology industry’s “poster-adults” Google is aggressively pushing to maintain its dominance in email services. We often associate a strong core as not requiring additional investments to fend off competition – but Google has taken the approach of embracing ML in order to avoid being disrupted. I appreciated the author’s acknowledgment that Google’s strong balance sheet also allows it to simply acquire the technologies it needs, so I question how much of an innovator the company is, versus its ability to assert its dominance through inorganic growth which it can execute virtually at will? In answering the question of transferability, I would argue that the ease of transferring to other areas of its business is almost irrelevant for the tail of Google’s smaller experiments which would have a marginal improvement in its overall revenue growth. Google’s revenue predominantly comes from its search business (https://qz.com/1334369/alphabet-q2-2018-earnings-google-is-more-than-just-advertising-now/) so can the business simply position itself as a cash-rich company that simply brings technologies in-house whenever it so desires?
Partnership between internal and external parties in the name of innovation is a difficult goals for companies to pursue and Ariel clearly laid out this challenge at L’Oreal in her piece. Ensuring that employees feel engaged in the innovation process and are simply not execution robots is also important to create an environment where individuals are empowered to be creative and not just simply take the ideas of external parties. Collaboration is important in distributed innovation systems. We see that at Instagram for instance the firm’s recognition that consumers wanted ways to get their followers into their lives, resulted in the “stories” feature, but product managers had to be open with users to recognI’ve this opportunity to innovate. For a firm like L’Oreal that has to stay ahead of trends, I ask myself which source of innovation is more important : feedback from consumers, or internal experts who claim to know the needs of their target market ?
This piece was truly revealing of how centuries-old industries such as the fashion industry are poised to be impacted by additive manufacturing and how luxury player Chanel is getting ahead of the industry in implementing the 3D printing technology in product design and performance innovation. By marrying traditional processes with contemporary advances, Chanel is able to build competitive advantages and remain relevant to its changing target audience while not alienating their original base. I don’t anticipate that 3-D printing will significantly change the in-store experience on a grand scale as positioned in the article, but instead will be additive to holding some stock in a store (on the low-mid price range). I do believe that firms like Chanel stand to benefit from the customization that additive manufacturing will provide to customers in a similar manner to which e-Commerce impacted the industry (i.e. provide a way that increases value to the consumer). In the case of e-commerce it was convenience to make purchases at the click of a button from the luxury of the home, with 3-D printing it will be about illuminating the unique attributes of an individual through customization. One can extend Mrs. Bensouda’s research into other industries such as automobiles which may begin to manufacture custom seats and steering wheels for drivers, utilizing 3-D printing.
This was an interesting read that questioned the longevity of arguably one of Wall Street’s most powerful and enviable financial institutions, and raised the question of their survivability prospects in the age of Artificial Intelligence. I have always believed that ML/AI technologies are prime disruptors in the financial services world (especially on the trading, and less so on the banking sides of these businesses) given the repetitive nature of their jobs, and the gains that can be made in making better decisions. The author highlights several benefits of AI/ML and how Goldman is positioning itself to improve its “secret sauce” SecDB in a way that they are effectively disrupting themselves before anyone else does so. At the same time, use of this old system as a framework for the development of a new and improved “smarter” system highlights risks that the innovation would not be as radical as Goldman expects. We saw an opposite approach to the build-out of AI at IBM Watson where they pushed to start from a clean-slate, resulting in better results – which raises the question: Should Goldman run a skunkworks designed lab to leap-frog the current approach of small iterative improvements in its improvements to its algorithm?