Henry Ford said back in 1909, “You can have it in any color as long as it’s black.” What was the driving force behind this remark for the Model T automobile?
- He wanted to mass produce a car for as many Americans as he could at a very affordable price.
- He knew that variety such as color variations would drive higher costs and undermine his desire to serve the broadest markets.
- If he could make everything the same, his cost and therefore his price, could be as low as possible.
Ford’s rubric created a tension in the marketplace that follows us to this day: customers want choice. They didn’t (and don’t) want to be limited to black. And, while they don’t expect to have infinite choice, they want choice.
Since Ford laid down the notion of no choice back in 1909, market forces have been driving a different reality for mass produced products.
- Operations executives must deal with the reality that resistance to choice and variety is futile.
- The desire for choice and variety expands continually.
- Operations executives must accommodate this need realizing that unit pricing won’t command much (if any) pricing premium.
As Dr. Marshall Goldsmith says, “What got you here won’t get you there.” It’s time to think about what “there” might look like in the next 3-5-10 years and take action.
Thought for the week:
“Vision without execution is a daydream. Execution without vision is a nightmare.” – Japanese Proverb
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Liz Alexander · May 11, 2016 at 6:18 pm
I’m taking a MOOC with Stanford on Strategic Thinking for Business Growth, Dave, and this very topic came up during our discussions last week. Which just goes to show how one’s mindset or interpretation of the world can be so pivotal…and the very thing that causes you to become “disrupted.”
I learned that Ford lost sales once GM came on the market, because they WOULD paint the cars for their customers. The difference being that GM understood the “human factor” inherent in a car. Ford saw it merely as transportation: a way to get from A to B. GM recognized that when consumers buy a car we don’t see it that way…we want more – an expression of our individuality! Therefore things like color are important.
Vital for any company, I think, to do a “mental model” audit every so often to ensure they’re keeping pace with their customers’ human desires – and their own relevance to the market.
Enjoyed your post, as always!
Dave Gardner · May 12, 2016 at 6:35 am
Thanks, Dr. Liz! I love the GM references. I knew “some company” had to seize advantage but had not had the time to research.