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I heard the most fascinating story the other day. I think it must be heard by
many people. I was invited to an evening talk and discussion where Mr. Bob Balke of Eastman Chemical Company, USA was the speaker. Many of these
evening “talks followed by dinner” are social and cosmetic in nature. I went
reluctantly. After the usual stuff on why innovation etc., Mr. Bob told us the
story of his involvement with Apple computers through plastics (which is one
of Eastman’s products).
The normal plastic that one finds in computer casings is a drab beige or an
uninspiring black. Not only is this a very small cost component of the
computer, it is a low cost commodity type of a material. So Mr. Bob and his
team wanted to see how high quality plastics could be sold to the computer
manufacturers. So did they have an “offsite” where a new selling strategy
could be worked out? No. They went into places where computers were used.
They went into offices and homes and studied how each person related to his
/ her computer. In the offices, the pattern was more or less similar. Computers
were bought for a more or less standard set of specifications that defined the
computer as a “tool” : RAM memory, speed, hard disk space, windows based
etc. However, in the homes, the computer took on a character of its own. If it
was in the drawing room, it was not only kept in as inconspicuous a corner as
possible, it was covered up. If it was in the bedroom, it was decorated (you
can’t have a drab beige box in a bed room!) A slow, “286” type machine
bought at throw away prices with no floppy drive, handling any memory was
placed in the kitchen to hold recipes and pasted over with “post-it” stickers!
Also, the computer in the bedroom was used largely for internet connectivity.
Only the computers in the study were used for work!
Armed with this in depth study of the usage of home PC’s, the team at
Eastman came up with creative ideas on how the use of decorative plastic
and attractive designs could change the home PC market. They talked to
many of the big names in the industry. No one was interested, except Apple.
Apple was struggling at 2% market share at that time! (and I must add here,
that Apple has the ‘identity’ of a maverick). The team at Apple saw what this
study meant. The result was the I-Mac. One of the few industrial products to
be displayed at the metropolitan museum of modern art!
The marketing Pandits shook their heads and said “$400 million in advertising
for a computer that has no floppy, no real features only a single wire to plug
in! This will be a disaster”. Fortunately for Apple & Eastman, the I-Mac opened
up a whole new set of buyers a majority of whom were first time users. The
home PC market exploded, Apple went from 2% market share to 15% market
share in 8 weeks!!
At TAO we have been advocating that true leadership lies in “gaining an
insight into the market space and using this insight to change the idea of each
persons job responsibilities, the way he / she links and teams up with other
job holders and the way the person understands what it means to contribute
to the organisations wealth”. Leadership has very little to do with charisma or
the ability to command and influence. This story proves our point.
If Mr. Bob’s insights about how 9/11 has changed the buying habits of the
average customer at the McDonalds or Taco Bell, we will soon see another
exciting trend where plastics affect Apples, burgers and buns!
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