Sony Walkman and Scenario Planning

Sony, a company that did not do proper scenario-type planning and only relied on standard forecasting.

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The Sony Walkman: Scenario-type planning

Sony didn’t do the proper scenario-type planning and only relied on standard forecasting, which is why it’s market share fell behind Apple’s.  A key requirement for scenario planning is for everyone in the planning session to understand that knowing the future is impossible and yet people want to know where the future could go (Wade, 2014).  However, it is important to note that scenarios are not predictions; scenarios only illuminate different ways the future may unfold (Wade, 2012)! Sony should have created a brainstorming session to identify as many of the driving force(s) or trend(s) that could have an impact the Sony Walkman (Wade, 2014)?  Thus, Sony should have thought of any trend or force (direct, indirect, or very indirect) that would have any effect in any way and any magnitude to the problem.

The Sony Walkman Story

Before the introduction of the Sony Walkman, cassette player technology existed in the 1960s, but households preferred to listen to vinyl records instead (Haire, 2009). The Walkman, a device that merged a light weight and portable cassette player with a light weight headphone, was introduced to the Japanese market in 1979 where it was sold out in three months at $150 per device (Adner, 2012; Franzen, 2014).  The device even had two headphone jacks so that two people can listen to the same music/recording at the same time (Haire, 2009). In the 1980s, the Walkman commanded about 50% of the market share in both Japan and the U.S. selling over 200 million devices over 30 years (Adner, 2012; Haire, 2009). The iPod made by Apple from 2001-2009 sold 160 million units (Haire, 2009).

Then, in 1990 CDs and digital music files like the mp3 came into existence (Adner, 2012; Franzen, 2014).  CDs and mp3s provided better quality and integrity than cassettes, which started to drive the cassette player’s market share towards zero.  Cassettes worked on the film, which tends to degrade with time as well, where the digital files didn’t.  The first mp3 player was from Saehan Information Systems, in 1998 (Adner, 2012).  Sony quickly adapted to these new formats as well and created the CD version of the Walkman and eventually the mp3 version of the Walkman, but it still stuck onto is proprietary music format the ATRAC (Franzen, 2014; Haire, 2009). Also, the industry saw this change from cassettes to CDs to mp3s has happened and was trying to figure out which mp3 player would eventually dominate the market like the Walkman did (Adner, 2012).

In 2001, the iPod came into the scene and took over the market, even when the market was already saturated with about 50 different types of mp3 players (Adner, 2012).  Steve Jobs learned that on its own, the iPod was useless, but with broadband download speeds and mp3 marketplace the market was ready for the easy to use the device at $399 and 5 GB of storage (Adner, 2012, Apple, n.d.). What made the iPod so successful was the analysis of the challenging forces that made mp3 players a hard market to sell and addressing them by providing seamless integration with an mp3, which was introduced the iTunes music management software in its first iteration in 2001 and re-imagined storefront called the iTunes Music store in 2003 (Adner, 2012).

By 2008, Apple had claimed 48% of the market share in mp3 devices which was similar levels of the Walkman in the 1980s (Adner, 2012). In 2010 the cassette version of the Walkman device line came to an end (Franzen, 2014). In 2015, the newest mp3 Walkman device the ZX2 is $1200 with 128 GB and expandable microSD card slot, which is now Sony’s aim for higher quality audio devices (Miller, 2015). Unfortunately, the ZX1 and ZX2 doesn’t have smartphone features like apps (Franzen, 2014; Miller, 2015).

Challenging forces to move from the Walkman to mp3 players:

Legally: In 1998-2001 there was no storefront to download mp3 music legally (Adner, 2012).

Technology: Even if music was obtained legally from CDs, people had to use a third party software to convert files, which in those computational computing days took hours to conduct (Adner, 2012).

Therefore, who cares if you are first to market (Saehan Information Systems) if there is no easy way to download mp3 music easily and legally.

Supporting forces to move from mp3 players to the iPod:

Legally: The iTunes Music Store, allowed for songs to be downloaded at a modest price and legally for $0.99, which Apple was able to get 10% commission from it (Adner, 2012).

Technology: The seamless integration of the iPod to the music storefront made the device easy to use, which helped increased its market share in the mp3 market. By 2009, over 8 Billion songs were sold, totally $800 Million in revenue (Adner, 2012).  This iTunes storefront, became a cash cow for Apple, while the iPod went under further innovation into the iPhone product line and the iPod touch product line (Apple, n.d.).

Example Scenario Planning four quadrants for the Sony Walkman case based on the forces listed above:

capture

Conclusion

Sony didn’t do proper scenario-type planning and only relied on standard forecasting, which is why it’s market share fell behind Apple’s.  However, the lesson learned from this case study is that a company doesn’t need to be the first mover to make it big in the market. A proper scenario planning could be the key to succeeding when entering a saturated market.  Apple was three years late to the party, yet it was their patience, learning about the supporting and challenging forces for mp3 player dominance, and letting the key market players align for their product, was the key to Apple’s success.

It is easy to do a scenario planning exercise on past events to today’s events (Wade, 2014). It is harder to do scenario planning moving into the future. Also, scenario planning events should never remain static.  The future is always evolving.  Thus, the scenario plan should change to reflect the new landscape, but the difference is that this planning allows for the mind to be more flexible and receptive to pivot quickly (Wade, 2014).  Scenario planning can take into account any force, not just the two listed above Political/Legal, Economical, Environmental, Societal, Technological, etc. (Wade 2012, Wade 2014).

References

Different Types of Innovation

A discussion on innovation examples for discoveries that are achieved through the following: Serendipity, Error, and Exaptation.

Serendipitous innovations: discovering what makes one thing special and applying it elsewhere

Georges de Mestral in 1941 went out to walk his dog in the woods and noticed how the burrs clung to him and his dog (Bellis, 2016; Suddath, 2010). De Mestral was curious enough to study these burrs under a microscope and from that he wanted to recreate it (Bellis, 2016). It took eight years of trial and error to create a synthetic burr that had tiny hooks, that would grip to a cloth full of tiny loops and the names of those two cloths “velvet” and “crochet” were combined to form Velcro (Bellis, 2016; Suddath, 2010).  Velcro was made to rival the zipper (Bellis, 2016). Velcro had its big break when it was used by NASA in the 1960s Apollo mission, then hospitals began to use them, then the military, and now it’s used on planes, cars, shoes, home décor, etc. (Suddath, 2010).

Exaptation innovations: Never giving up, finding secondary uses for the same product, and not being afraid to pivot when needed

The mixture of flour, water, salt, boric acid and mineral oil was first originally used as a reusable soup product to help clean wallpaper as part of the Kutol company (Biddle, 2012; Hiskey, 2015; Wonderopolis, n.d.). Hiskey (2015), chronicles that in 1933 Noah McVicker and Cleo McVicker created the doughy substance because at that time wallpaper couldn’t get wet.  However, the lack of toxic chemicals made it an ideal to become the toy it is today (Hiskey, 2015; Wonderopolis, n.d.).  This pivot from wallpaper cleaner to toy occurred when teachers began to use this product for a molding compound to make art for craft projects in school (Hiskey, 2015; The Strong, n.d.; Wonderopolis, n.d.).  When, the inventor’s nephew, Joe McVicker, eventually came into the Kutol Company and noticed this secondary use of their product, and thought it would be good to rename the product “Play-Doh” and marketed it to schools (Biddle, 2012; The Strong, n.d.; Wonderopolis, n.d.).

Erroneous innovations: Creating something by accident in the pursuit of something else

Two chemists in 1879 were working in the Lab at John Hopkins University, where one of them got hungry and forgot to wash his hands (Hicks, 2010; Smallwood, 2014).  Constantin Fahlberg didn’t die from this, which could have happened, but noticed that the chemical saccharin (C7H5NO3S) which he and his peer created made his food taste sweet (Hicks, 2010).  He created the Artificial sweetener that is now used in the “Sweet’n Low” pink packets; that is 300x sweeter than cane sugar and cheaper to produce (Hicks, 2010; Smallwood, 2014).  In 1884, Constatin patented the chemical saccharin without his co-inventor and set up a production shop in New York City (Hicks, 2010). In the 1970s a saccharin scare was created stating it was empty calories and harmful to the health of the consumer, the first part of the claim was substantiated, but the second claim has never been vetted with evidence, and in 2000 it was removed from the U.S. National Toxicology Program list of carcinogenic chemicals (Smallwood, 2014).  From this erroneous innovation, aspartame in 1965 a chemical 200x sweeter than sugar and sucralose in 1976 that is 600x sweeter than sugar was created (Hicks, 2010).

References

Case Study: Sociotechnical system in education

A discussion of sociotechnical systems in Brazilian education.

Definition of key terms

  • Sociotechnical Systems: the interplay, impact, and mutual influence when technology is introduced into a social system, i.e. workplace, school, home, etc. (com, n.d.; Sociotechnical theory, n.d.) The social system comprises people at all levels of knowledge, skills, attitudes, values and needs (Sociotechnical theory, n.d.).
  • Formal Learning: scholastic learning in schools (Hayashi & Baranauskas, 2013)
  • Non-formal Learning: scholastic learning outside of schools (Hayashi & Baranauskas, 2013)
  • Informal Learning: other learning that occurs outside of schools (Hayashi & Baranauskas, 2013)

Case Study Description (Hayashi & Baranauskas, 2013)

This qualitative study introduced 520 donated laptops among the students (ages 6-14) and teachers in the public school, Padre Emilio Miotti School, in Campinas, Brazil.  With a goal of providing a detailed description of the results in order to inspire (transfer knowledge) over focusing on generalizing the results to other schools and scholastic-socio technological systems.  The sociotechnical system is defined by cultural conventions, where the participants in the study can be classified under in the formal, informal, and technical levels of a Semiotic Onion (Figure 1).

1.png

(Source: Adopted directly from Hayashi and Baranauska, 2013)

Therefore, the goal of this qualitative study was to understand how to insert the technological artifacts (the laptops), into the scholastic curriculum, that makes sense to the end users (scholastic community: teachers, students, etc.) into a meaningful integration across all aspects of the Semiotic Onion.  Data collection for this qualitative study was done through interviews and discussion in the Semio-participatory Workshops in 2009, as well as the authors being participant observers over a one year period in the scholastic activities.

There were four opportunities that should be considered (supporting forces for adoption):

  • Transforming homework assignments: Allowed for teachers to bring some homework into the classwork and allow the students to conduct their searches, normally done at home at school. Teachers could now observe the emotional flux of their students evolve while they complete the assignments.  This evolution of the emotional flux during homework use to be only observed by parents.
  • Integrating the school in Interdisciplinary Activities: In a collaborative fashion, teachers were able to create assignments using the laptop cameras to capture everyday objects or events of the students to help show them how to eat healthier, different animals and their behaviors, save on the electric bill, teach them about calories, watts, electricity, animals, etc. This creates a path of data to information to knowledge that helps motivate the students to learn more.
  • Laptops inside and outside the school walls: Students have more pride in using their own devices and were willing to showcase and educate the public about their technology and its effectiveness. This has far reaching results that were not explored in this study.
  • Student Volunteers: The use of older students to help troubleshoot younger student’s laptop problems, which taught some students patients and other skills across the Semiotic Onion. The students learned about responsibility, empathy, and other vital social skills.

There were issues across the Semiotic Onion that were also enumerated (challenging forces for adoption):

  • Technological: Internet connection was slow and intermitted even though there was broadband internet available and wireless routers
  • Technological: How to recharge 30 laptops at a time with only two wall sockets
  • Technological: How to transport laptops back and forth from storage rooms to classrooms
  • Technological: Laptop response times at certain periods of times were slow at best
  • Technological: Demand for technological support increases dramatically
  • Formal: The fear of laptops being stolen from the students on their way to or from school
  • Formal: Teachers worried that they could find or create technological assignments that fit their lesson plans
  • Informal: Teachers are not comfortable in teaching with technology they are not familiar with themselves
  • Informal: Most parents didn’t and couldn’t use the student’s laptop to assist them

This study concludes by saying that the introduction of technology into the education system in these scenarios for this case study had a positive response and that key lessons learned, assignments could be duplicated and studied in other scenarios.  Therefore, the authors emphasized on the transferability of the study rather than generalizability of the results.

Evaluation of this case study

This study was a case study of the socio-technological scholastic system when donated laptops were introduced into a Brazilian school.  This paper presented the socio-technological plan and its analysis.  The authors were thorough by listing all the opportunities (supporting forces for adoption) and issues (challenging forces for adoption) of technological inclusion into the scholastic system by evaluating it from the perspectives of the Semiotic Onions.  Therefore, this was a thorough study of this study’s positive introduction of technology to the scholastic, social system.  The only drawback in this study is that the researchers failed to interview how the laptops affected the world outside of the school walls and familiar homes.

This paper is a well-designed qualitative study that uses surveys, interviews, etc. to gain their primary results, but to improve the study’s credibility, the researchers become a participant observer for one-year videotaping and taking field notes to supplement their analysis.  They mention that case studies are done to foster transferability of ideas across similar situations rather than generalizing the results.  Therefore the authors stated the limitations of this study and how they mitigated issues that would arise about the study’s credibility.

References:

Higgs Boson: Case Study on an infamous prediction that came true

The discovery of the Higgs Boson is an epic win in the field of science and an infamous prediction that came true.

Definitions:

  • Forecasting (business context): relies on empirical relationships that were created from observations, theory, and consistent patterns, which can have assumptions and limitations that are either known or unknown to give the future state of a certain event (Seeman, 2002). For instance forecasting, income from a simple income statement could help provide key data for how a company is operating, but the assumptions and limitations on using this method can wipe out a business (Garrett, 2013).
  • Predictions (business context): are a more general term in which, is a statement of a future state of a certain event, that can be based on empirical relationships, strategic foresight, or even scenario planning (Seeman, 2002; Ogilvy, 2015).
  • Scenarios: alternate futures that change with time as supportive and challenging forces unfold, usually containing enough data like the likelihood of success or failure, the story of the landscape, innovative opportunities, challenges to be faced, signals, etc. (Ogilvy, 2015; Wade, 2012).

Case Study: An infamous prediction that came true

The Higgs Boson helps tell the origin of mass in the universe (World Science Festival, 2013). Mass is the resistance of an object to be pushed and pulled by other objects or forces in the universe, and mass is made up of the constitute particles of that object (Greene, 2013; PBS Space-Time, 2015; World Science Festival, 2013).  The question is where does the mass of these particles that give an object its mass comes from?  The universe if filled with an invisible Higgs Field, in which these particles are swimming in and experiencing a form of resistance (when the particle speeds up or slows down), this resistance in the Higgs Field is the mass of the particles (Greene, 2013; World Science Festival, 2013).  Certain particles have mass (electrons), and others don’t (photons), this is because the certain particles interact with the invisible Higgs Field (PBS Space-Time, 2015). Scientist use the large Hadron Collider to speed up particles in such a way that when they collided in the correct way (1:1,000,000,000 chance), the particles’ collisions would be able to clump a bit of the Higgs Field to create a Higgs particle that lasted for a 10-22 second (Greene, 2013; PBS Space-Time, 2015; World Science Festival, 2013). Therefore, finding the Higgs particle is a direct link to proving that the existence of the Higgs field (PBS Space-Time, 2015).

The importance of proving this prediction correct (World Science Festival, 2013):

  • Understanding where mass comes from
  • The Higgs particle is a new form of particle that doesn’t spin
  • Shows that mathematics lead the way to discovering something about our reality

This was a prediction in the waiting to be confirmed through observation for over 50 years, which got its roots in the form of scientific and mathematical roots of quantum physics and by Higgs in 1964 (Greene, 2013; PBS Space-Time, 2015; World Science Festival, 2013).

Supporting Forces for the prediction:

  • Technological: the development of technology to study mathematics over the course of 50 years helped facilitate the discovery of this prediction (Greene, 2013; World Science Festival, 2013). The actual technology use is called the ATLAS detector attached to the Large Hadron Collider (Greene, 2013).
  • Financial: Through international collaboration from thousands of scientists and over a dozen of countries, they were able to amass the financial capital to build this $10 Billion Large Hadron Collider.

References: