The B2B/B2G high-tech company frequently carries out simultaneously types of activities with contradictory logics: standard and tailor-made on the one hand, products and projects on the other.
Of course, all cases are possible and will sometimes be encountered:
- A company specialising solely in customised high-tech products (a test bench or a specific simulator, for example) or, on the contrary, in standard products (an oscilloscope, a medical device): it will then have a typically “product” strategy and marketing
- A company specialising solely in customised projects (large buildings, large structures, site security).
- a company specialising in standard or quasi-standard projects (urban mini-tunnels): it will then have a strategy and marketing that are in fact more “product” oriented
However, in technology, a large number of companies will simultaneously practice standard and customised by combining them in different ways.
Tailor-made products and projects based on standards
There will be companies offering “tailor-made products based on standard” and “tailor-made projects” based on shared products.
They must therefore succeed in combining different logics, which is neither without challenges nor without difficulties
Product companies will seek to benefit from both the cost-cutting effects of standardisation and the margins afforded by customisation:
- They will practice terminal differentiation of their products while pooling as much as possible the common upstream elements between products
- They will develop platforms. To illustrate, even if the businesses are different, this logic is similar to that of a car manufacturer which creates its models by pooling elements in a platform.
The project companies will endeavour to offer “tailor-made” projects in the sense of being adapted as closely as possible to the client’s needs, while pooling as many elements as possible between different projects. These shared elements may be components but also studies or processes.
A double challenge
Project companies that produce products at the same time will face a double challenge.
The first challenge will be of the same type as before: creating platforms and sharing components or building blocks
The second challenge will be to ensure coexistence:
- A project-based approach, which is often historical in the company and which will most often militate in favour of developing tailor-made products, specific to a given project, as close as possible to the customer’s request
- A product logic, which on the contrary will militate for developing products for multi-project markets and not for a single project.
Product logic will depend in part on the leeway given by the customer in the project specification. It will be difficult to apply with customers who will be very detailed in their specifications. It will be a matter of negotiation not to jeopardise the future market for products that have been developed specifically for a particular project.
This product/project coexistence is often delicate internally because if all the products are used in the context of projects, it is the projects that generate margins, whereas the products require development investments
The imperative of product logic
It should be noted that the “product logic” has become more and more indispensable in project companies because it is often impossible to win a project because the price is too high if you have to develop products specifically.
Clients are less and less willing, with some exceptions, to pay for complete customisation. In order to reduce costs, it is therefore necessary to standardise and pool project “bricks”, whether they are process elements, components or “building blocks”. It is a question of making “partially or totally customised products based on standards”.
In the case of the high-tech B2B/B2G company, we can see that the difficulty is that this leads to a particular tension between two opposing logics that must be reconciled: the logic of standardisation/mutualisation and the logic of customisation. Although customisation has long been the historical logic of the company, it is generally the logic that dominates the debates because it brings resources and profitability. Nevertheless, it will be necessary to make room for and bring to life the product logic of standardisation/mutualisation, which is a vital issue for winning projects.
How will these objectives be achieved in practice?
- Through product engineering work, which will be responsible for creating platforms and pooling components and building blocks as much as possible
- By the creation, in parallel with the project centre, of a product centre responsible for defending the product logic against the project logic, as well as the definition of an arbitration body between these two centres.
