OEM Manufacturing and Growth: A How-To

Like many of you, our customers often buy our products to install directly into new and often exciting OEM (Original Equipment Manufacturer) products. Many are SMBs, just as we are.

You see, we get very excited to see what our OEM customers are developing! They know their customers, and they know their products. Often these OEMs are solving problems that companies have been having for years. New sensor equipment now determines within millimeters the correct fill of a bottle of soda or water. A different company might be determining highly accurate pressures for creating exact pill density for the pharmaceutical industry. 

But how in the world does a company determine what problem to solve next?

 
In reality, many of us intuitively know how to embark on this process. The question becomes, how do we translate that intuition into a corporate structure?

The process is very nicely summed up in the article "Are you sure you want to innovate like a startup?" The piece was co-authored by Aldo de Jong and Harry Wilson from Claro Partners and Pascal Bouvier, fintech venture capital investor. http://bit.ly/Corp_v_startup

In a nutshell, the article discusses the difference between the way that startups innovate, and the way that corporations innovate. The former has begun to influence the latter, and the article outlines some pitfalls that may occur. Taking the article's advice verbatim may be easier for very large companies, since many of us can't afford to create entire research arms of our companies, but at the root of it all is this: Know. Your. Audience.

“One of the classic lean startup fables is Airbnb’s experiment to hire professional photographers to shoot each listing, resulting in a 2-3X increase in bookings - but where did this hypothesis come from? 

Back when Airbnb was all air mattresses and Obama-branded cereal, their co-founders traveled to New York City, met every single host, lived with them, and wrote their first reviews. Their ‘aha’ moment was seeing the mismatch of grainy photos compared to the real home; this insight gave life to what was, on paper, a mad experiment to run. As a human-centered designer, Brian Chesky lives this philosophy up to today (with guests on his couch every night). It’s this customer immersion that informs the lean experiments that have made Airbnb so different, and successful.”

Those of us in charge of gathering this knowledge and are doing this on-the-ground research for our own OEM development must find the balance point between knowledge and discovery. In other words, time is money, and the next time, Chesky may not have stayed with each and every host to determine his growth point.

Next steps, then, are clear.

Don't guess. 

Meet customers, talk to them, spend time at their facilities, and find out what is going on at the ground level. Find your own Aha! moment that good, clean research can provide.