Brand Building Through Product Innovation in Taiwan

Last week I spoke at Computex 2009 in Taiwan at an event hosted by the TDC (Taiwan Design Center). A key challenge faced by many Taiwanese companies in any part of the computing space is brand building. Taiwan’s computing culture, to generalize broadly, is all about OEMs. A few have made the leap into consumer brands (e.g., Acer, Asus, HTC), but most are still OEMS, increasingly evolving into ODMs, and no more than flirting with the notion of becoming a consumer brand. Under this backdrop, I spoke about brand building strategies for Taiwanese companies from 2 perspectives.

The first relates to a theme we often discuss at frog — that true computing innovation today is much more than convergent hardware-software product innovation. Convergence involves content and services, which means any real product innovation will require addressing the broader business system in some way (e.g., through integration with services, through new partnerships). Bringing this lens to a traditional product design process changes what and how we research, where we look for inspiration, and what we design. (This concept of the computing device as a “white box” is also discussed here: http://designmind.frogdesign.com/videos/misc/the-white-box-talk.html).

The second relates to the use of a coarse process for innovation, a process that embraces upfront research and strategy to provide a design direction, but one that allows for ambiguity and experimentation downstream. This post-design process is highly concurrent, parallelizing design with development and engineering, and using prototypes for high-level creative inspiration, not just design validation.

After discussions at Computex and with companies through the week, it is clear that Taiwan looks at these 2 strategies that underlie product innovation-based brand building in unique ways, deeply rooted in its “OEM for the world” history. Many OEMs, faced with pressured demands from big brand customers to have the latest and greatest hardware that end-users will want, are effectively hardware prototyping engines, very adept at going through rapid cycles of hardware prototyping, validation, and performance testing, generally looking no more than 6 months in the future. This culture of experimentation is not simply for the purpose of meeting the demands of big brand customers. It extends into how many OEMs view hardware prototyping — as a continuous search for optimal hardware innovations (often through combination or miniaturization) given a fixed set of input components.

This experimental mentality has many similarities with the coarse process, although its intention is not as forward-looking. It would be interesting to explore if this mindset could be leveraged in other domains — extending into software and UI experiences to start. As hardware-based competition becomes increasingly low margin, the UI is a compelling vector for differentiation, although not one traditionally embraced by OEMs. However, big brands are increasingly pushing design toward ODMs, so there is a strong opportunity.

As for truly embracing the “white box” vision, only the largest Taiwanese brands seem ready and able, and none have really invested so far. The search for the next Acer, Asus, and HTC continues...

- Ravi Chhatpar, Strategy Director, Shanghai office