A product platform is a business strategy and a tool that can help overcome the challenges of complexity in a company striving to deliver customer specific products in global competition.
Product platforms are renowned for their ability to enable companies to significantly cut down total cost, improve product quality, shorten lead time and time to market, while at the same time reducing the complexity inside the organization and increasing the product variation and possibilities in the market place.
A product platform is a set of building blocks shared between different products in a given product family. They embody everything which is shared or in common between products and are ideally the carriers of much of the accumulated technical expertise and knowledge, which tie the products together and distinguish the product range from the competitors product ranges.
Some companies can benefit from physical building blocks in the form of components or modules, while others can benefit from more abstract building blocks in the form of modular architectures and generic designs. Typically, most companies can benefit from both. The actual sharing differs much from company to company, but the emphasis is put on the effects of sharing.
Balancing Two Ideals
Platform design is about striking a balance between two ideals: the company that meet all needs and customer demands with a new product, and the company that is able to sell the same product continuously, because of low price and quality superiority.
The first company will experience high costs and the second company will experience low sales. Ideally, companies that are in-between can achieve low costs and high sales, but unfortunately the majorities actually achieve high costs and low sales. This situation is most often due to a mismatch between a somewhat modular range of products and a somewhat modular value chain.
Reusable Concepts & Building Blocks
When designing products a company needs to create reusable concepts and building blocks that mirror capabilities in the value chain, plus replaceable concepts and building blocks that mirror the market demands.
The aim is to have a common conception about which things are shared and can therefore be a starting point for rationalization in the value chain, and which things are flexible and can therefore be exploited in product offerings.
Ideally, a successful platform builds upon smart solutions, which makes valuable product variety possible with minimal differences in the value chain. These smart solutions, together with the insight of exactly which features are valuable to the customers and which features are of less importance, are the necessary requirements for creating a platform. This beneficial and valuable knowledge can also differentiate the experienced company from the less experienced one, and that is why any experienced company should capitalize on their experience by creating product platforms.
A New Way of Thinking
For the majority of companies, the product platform approach will lead to a whole new way of thinking product development and design. Product designers need to start thinking in existing designs, using these as default, and thinking variety in the terms of value chain capabilities. Instead of modifying an existing design to a new requirement, the designers needs to think of how to fulfill both requirements (not forgetting the old design) with a minimum of inconvenience for the value chain, and how to transfer this knowledge downstream so that mismatches will not occur.
