Out of the basket

News this week of what’s in and what’s out of the ‘basket’ of goods used by the Office of National Statistics to calculate retail price inflation has included the removal of disposable cameras – page 13 of http://www.statistics.gov.uk/articles/nojournal/CPI_and_RPI_The_2010_Basket_of_Goods_and_Services.pdf mentions that they’ve been rendered obsolete by digital photography but also by cameras in mobile phones.  It’s a case of a product coming full circle, having been innovative 20 years ago, but particularly significant because Michael Hammer and James Champy, in their book on re-engineering the corporation from the mid-1990s, cited Kodak’s introduction of their disposable camera as a successful example of a business changing.

Hammer and Champy favoured a very rapid and radical approach to business change that, with hindsight, was often ill-advised and unsuccessful.  But their analysis was very much aimed at large, established, American firms facing Japanese competition, and Kodak, when disposable cameras first became widely available, fitted that profile perfectly.  Their principal competitor, Fuji, already had a product and for Kodak the imperative was to get their own contender in place as rapidly as possible.  It was a new product which could benefit from a development team unhindered by the business’s traditional processes.  Also because the success of the disposable camera depended on setting up mechanisms where the lenses and other components could be re-used, the product design and the systems for processing the film and distributing the products were all very closely related.

Although Hammer and Champy claimed that the business process re-engineering concepts used by Kodak and others at this stage were radically new, in practice a lot of the innovation came down to having different teams working concurrently on different aspects of a product development, and on setting up communication channels between these teams, so that the whole product development process was compressed into less time.  This was still a worthwhile benefit in cases like this where there was clearly a need to get into the market quickly.

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