Snow-cone Management

Dec. 21, 2004

Not long ago, a former associate reminded me of a conversation we'd had some years back when we both worked at Huffy Bicycle Co. Steve Goubeaux, who was then vice president for sales and marketing at Huffy and is now a principal with Visual Marketing Associates Inc., a marketing and creative-design firm, recalled that I once told him that we needed to make our products like snow cones -- adding the "flavors" that create differentiation at the last possible moment. A snow cone is simply a paper cone filled with crushed ice. Every one is alike until the flavor is selected. At that magic moment, the pristine white ice is transformed into a sparkling purple (grape), brilliant red (strawberry), neon green (lime), vibrant orange, or -- most impressive of all -- a blinding blue. With snow cones, the obsolescence costs are pretty low. Crush too much ice, and you throw out a little ice water. The paper cones don't spoil or become obsolete. At the end of the day, closing the snow-cone stand takes about 10 minutes and a little soap and water. It makes sense to build other products the same way -- keeping them mass-produced and generic until the orders arrive, then adding the "flavors" that make them unique at the last minute. Ironically, the conversation that Steve recalled occurred in the 1980s, but the concept is even more viable today. We now know it as "mass customization." During our latest discussion, I altered the metaphor a bit, since snow cones have other notable characteristics. On a hot day, they melt very fast. Eat them too quickly and you freeze your throat -- and you may end up with a headache. But if you eat a snow cone too slowly on a hot day, you'll likely end up wearing those brilliant colors all over you. Doing business these days presents similar dilemmas. We know how to make products at the last minute, but can we introduce new versions rapidly enough to avoid competitive headaches? With shortening product life cycles, new products come and go almost as fast as snow cones melt. Designers and marketers have to get them right -- and get them into the marketplace before competitors do. Product-tooling leadtimes are a big problem in the U. S., since many shops still stick to the old five-day, 40-hour workweek with only one or two shifts per day. You do the math. Two 40-hour shifts means that only 80 hours out of a 168-hour potential week are spent on productive work -- less than one-half of the available time. Tool shops in less-developed countries often work 140 or more hours per week. As a result, overseas firms have a 75% advantage in the speed of producing critical-path items for many durable products. They can make and enjoy their "snow cones" while ours are melting. An early product launch -- getting out ahead of the competition -- has always been a big advantage. Today, it is bigger than ever. The company that gets to market first capitalizes on the early part of the life cycle where price margins hold up and the opportunity exists to spin off improved versions that keep competitors at bay. The Internet makes it possible for competitors to copy and improve on successful ideas even faster. But there is nothing wrong with competitive speed; in fact, it's what usually wins in a fast-moving marketplace. The problem lies at the front end of the process, where the marketing folks define what they want the designers to design and the factory to manufacture. One wrong move there and the proverbial snow cone ends up all over the pavement. Today, product quality is a given and superb service is mandatory. Costs are constantly declining as markets and products mature. What's left are innovation and speed. Do one without the other and you lose. Do both and you may have time to enjoy that snow cone before it melts. Next time you buy a snow cone, think about how refreshing it is when it's just right. John Mariotti, a former manufacturing CEO, is the author of Smart Things to Know About Brands (1999, Capstone Ltd.). His e-mail address is [email protected].

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