Meeting the customers silent needs
DEVELOPING a new product can be a tough challenge, particularly when it comes to meeting the needs of today’s marketplace.
Manufacturers are currently finding that surveys and marketing research can often fail to deliver the knowledge needed to produce a successful new product. What’s becoming more important is the ability to identify the unarticulated needs of the customer, encapsulated by the new concept “tacit market knowledge”.
Phil Timbrell, engineering manager with Preformed Line Products (PLP), developed the term from his research on B2B product development in Australia. He says that tacit market knowledge stems from the concept of latent needs.
“Latent needs are the needs that the market has which they don’t articulate, while tacit market knowledge is knowing this need without actually soliciting it from the customer.
“A company’s hit rate of successful products can range from between 10% and 40%. I see tacit market knowledge lifting that up to 50% or even better.
“According to my research and interviews, people who have been successful with new product development possess knowledge of the market that cannot be clearly articulated or taught, but is rather learnt from experiences,” Timbrell told Manufacturers’ Monthly.
PLP designs and manufactures hardware and fittings for overhead power line distribution and underground communication cables. As winners of the 2006 Western Sydney Industry Awards Outstanding Product award, PLP’s own track record in new product development demonstrates a clear use of tacit market knowledge.
One product recently designed by the company is the Safety Service Disconnector (SSD) – a device which fits over existing single phase service cables, providing a means of ensuring that broken service lines will fall to the ground in an electrically safe manner. Although formal market research was conducted with a number of utilities when the SSD was in its developmental stages, Timbrell says that the product’s “wrap around” concept was conceived through the PLP team’s combined, tacit knowledge.
“The market had not asked for a device that could wrap around an existing service and cut the cable when it needed to be cut, but we identified it as a classic latent need when we realised that all power companies strive for 100% supply of power for their customers.
“The key element in this was having employees spend time with the customer, collaboratively solving problems and exposing engineering staff to the market in order to build up a vast resource of practical knowledge,” he said.
PLP were recent hosts of an Innovative Technology Network (ITN) Cluster Group seminar in NSW. For more information, contact Noeleen Alden on 02 4620 3612.
1-Sep-2006