Abstract

Discussion of 'universal design' is only the beginning step toward facilitating the development of assistive technologies.  'Universal design' recognizes the potential benefits gained from consideration of potential markets other than the assistive market.  Further benefits may be derived from development of a comprehensive commercialization strategy.  Such a strategy would analyze the ease of entry and capital resources necessary to enter all viable markets.  Initial commercialization efforts are targeted to that market application that would result in the highest probability of successful entry into all markets.  This extension beyond 'universal design' will yield greater success by reacting to all critical market factors.

Key Words

technology, commercialization, strategy, 'universal design', 'market entry', resources

Universal Design

The concept of 'universal design' was born out of desperate attempts to reduce the premium prices charged for assistive devices.  Such prices are the natural consequence of the fact that the assistive market is a small market, where it is difficult to reduce prices through manufacturing and distribution economies of scale.  The manufacturer or distributor of an assistive product cannot therefore reduce the price of each unit by spreading fixed capital costs over a larger volume of total units. 

The logical response to this problem is to sell an assistive device outside the assistive market.  The increased scale of production should lead to lower prices in all markets.  Such logic is resisted by product designs that limit application only to the assistive market.  The product designs do not provide a benefit to consumers in other markets.  The cost to redesign a product solely designed for the assistive market so as to provide a benefit in other markets is often higher than any gain derived from economies of scale in manufacturing and distribution.  Thus, it has been assumed that initially striving for a  'universal design', suitable for multiple market application, would open access to non-assistive markets by achieving economies of scale.

As a practical matter, 'universal design' is seldom carried out.  From a conceptual standpoint, 'universal design' is strategically limited.  It is only concerned with the technical issue of engineering design.  It does not look at market, economic and competitive factors that may be of predominant importance.  'Universal design' also tends to treat all markets as an indivisible whole, without allowing for variations between different markets.  As will be discussed later, these differences may be key to the successful commercialization of the underlying technology.

A product designed for a particular market is often a reflection of its manufacturer: a single market dimension.  The manufacturer is typically only familiar with the needs of the market for which the product is created.  It has a distribution channel that serves only a single market.  Therefore, as a consequence, it does not recognize the opportunity of pursuing other markets and takes no action to do so.  In fact, venturing into new markets directly places at risk all of the existing business operations.  This risk serves as a major disincentive to consider additional markets.  Such a single dimensional business would be more prone to license the product to another company that is already established in the other market.  A license of the technology may lead to the desired economies of scale if the original business completes all of the manufacturing of the product.  'Universal design' is a more natural fit as a concept with manufacturers who already service multiple markets.  Unfortunately, there are not that many manufacturers who service both assistive and non-assistive markets.

Manufacturers of assistive devices are used to setting higher product prices, reflecting the small market.  They are reluctant to enter other markets where they face competition and must sell at lower prices.  The infrastructure of their small scale business operations may have built in costs that cannot be readily changed to enable moving to mass markets.  An additional negative aspect of entering non-assistive markets is that it may force a reduction of pricing within the assistive market.  Consumers of assistive devices will probably make their purchases from the non-assistive markets, of which they are also members, in pursuit of lower prices.  The manufacturer of assistive products cannot leverage off of its success in the assistive market, for it may dissipate before a foothold in the non-assistive market is established.  The only way that elevated pricing can be maintained is where the application of the product within the non-assistive market is sufficiently dissimilar that different pricing structures are appropriate.  If these dissimilarities are too great, they may not be overcome by 'universal design'.

Universal Strategy

A comprehensive or 'universal strategy' to commercialize the underlying technology will encompass all important market, economic and competitive issues within all viable markets while treating each market individually.  Furthermore, it will identify that market that represents the best market in which to initiate commercialization activities.  In effect, the first market serves as a tactical foundation or beachhead upon which all subsequent market thrusts may be built.  'Universal design' is not abandoned in a comprehensive market strategy, but it is subordinated to predominate issues.

Analysis of Core Technology

As with 'universal design', a 'universal commercialization strategy' requires an understanding of the core technology.  One must look beyond the manner in which a particular product application is manifested.  This requires a full understanding of the benefits the technology conveys upon consumers in any of the alternative markets into which it may be sold.  Analysis of the technology will delineate between those features or characteristics of the core or base technology and those that may be add-on features or enhancements specific to one or more markets.  Analogous to mathematics, effort is made to identify the prime numbers or the common denominators within a commercialization formula.

In illustration of core technology analysis, an invention of JH Design serves as an example.  The invention is a bicycle seat post shock absorber.  Displacing the standard seat post, the device attaches to the bicycle seat.  It serves to absorb downward force when the bicycle hits a bump.  Designed for application upon bicycles, it is comprised of four primary components: (1) a bicycle seat mount attachment, (2) a piston and cylinder, (3) a roller bearing, and (4) adjustment shims.  The piston and cylinder serve to provide the benefit of shock absorption.  The roller bearing serves to enable movement of the piston within the cylinder whenever the piston and cylinder are not perpendicular to the ground.  The seat mount attachment and adjustment shims are peculiar to bicycle applications and probably will not be used in other applications.  The product is sold into the sporting goods market.  In prospective consideration of other potential applications for this shock absorber technology, only the components comprising the (1) piston and cylinder and (2) the roller bearing may be transportable.

Without consideration for potential non-assistive market applications, the core technology may be applied to a large variety of products within the assistive market.  Any product that would benefit from shock absorption, from wheel chairs to crutches, may make use of the core technology.  However, the core technology must be compared with other technologies, of which there are many, which perform a similar function.  At a technical performance level, these other technologies would include other shock absorbers, springs, cushions, and pads.  Each of these technologies fulfills the needs of the consumer to a certain extent.  If this need is completely fulfilled, then the consumer will weigh the choice between the existing technology and the proposed utilization of the core technology from the bicycle in terms of price.  The consumer will only move to adopt the new core technology if its price is lower than that of the old technology, reflecting a tendency to stay with the 'tried and true' technology unless motivated to change by price savings.

Continuing with the illustration, a crutch may serve as an example of a product which may benefit from incorporation of the new core technology.   When examining the needs of the consumer, it may be determined that existing technology is not completely fulfilling present needs.  Therefore, the consumer will be motivated to acquire a crutch product which incorporates the new core technology if the new core technology provides superior benefits.  If the core technology provides superior benefit, the consumer may be willing to pay a higher price than that previously paid for the old technology.  Product pricing directly impacts related issues of market, economics and competition.  These issues may favorably or unfavorably support application of the core technology within the assistive market.

To merely consider conversion of the core technology from the sporting goods market to the assistive market is too narrow of an analysis.  As indicated, even if the core technology presents a superior advantage over all other existing technologies when applied to a crutch product, entry into this market may be defeated because of other issues.  Consideration must also be given to achieving superior market, economic and competitive positions.  This can best be accomplished through implementation of a universal commercialization strategy.

Ease of Market Entry

Each potential market for the core technology, out of all viable market alternatives, will have a different degree of difficulty in achieving market entry.  The degree of difficulty may be a consequence of many different factors.  Such factors may include:

·         presence of technically or functionally equivalent products

·         requirements for regulatory approval

·         cultural attitude towards change in the form of new technology

·         perception that product will fulfill needs

·         the presence or absence of the core technology owners in a given market

·         cost of production tooling, establishment of distribution system and creation of product awareness

·         relationship between perceived risk and potential reward

·         time required to complete commercialization activities

Continuing with the example, entry into the sporting goods market with a bicycle application will meet resistance in the form of competing products, a preference for low weight and improved performance, and JH Design's status as a startup within that market.  By comparison, an assistive product is often subject to the additional resistance of product regulation.  However, JH Design has even less familiarity with the assistive market as opposed to the sporting goods market.  Each market represents roughly equivalent cost of production tooling.  However, because of the greater size of the sporting goods market, costs of establishing a distribution system and treating product awareness will also be greater.  The smaller market size of the assistive market indicates that the potential reward will also be smaller, although higher price margins may offset this factor.  It is unclear whether it will take greater time to complete commercialization activities within either the sporting goods or assistive markets.  On the whole, after weighing all factors, it would appear that greater resistance to market entry will be experienced in the assistive market.

The distinction between alternative market applications may be clarified by consideration of yet a third possible application of the core technology.  This application is within the office equipment market for a standard stenography or secretarial chair.  This market faces the additional resistance of greater competition from existing products that are technically and functionally equivalent.  Within the office equipment market, there is an even greater diversity of established distribution channels, thereby increasing the costs of establishing a distribution system.  Likewise, creation of product awareness may only be accomplished by a greater investment in advertising.  As a consequence, entry into the office equipment market presents greater difficulty than either the sporting goods or the assistive markets.

Selection of Lead Market Application

The determination that the sporting goods market presents the easiest market entry would support a decision, based upon a universal commercialization strategy, to first apply the core technology within the sporting goods market.  Alternative viable markets, though potentially larger or promising higher profit margins, should be subordinated to that market with easiest entry.   Only after completion of entry into the sporting goods market, should any attempt be made to enter the assistive market, the office equipment market, or any alternative viable markets. 

Other factors may strongly influence the selection of a lead market application.  These factors may take the form of:

·         government programs to encourage new technology within a given market

·         investor willingness to provide funding for a preferred market

Successful entry into any market will bolster credibility assigned to the potential opportunity of other markets.  Even though this perception may be unfounded, enhanced credibility will take the form of quicker adoption of the core technology and easier access to capital.  This will result in accelerated commercialization at significantly lower costs compared to the initial market entry.

Successful completion of commercialization within the initial market will yield profits which may fund entry into other markets.  The existence of these additional resources and the reduced costs of entry in other markets will, in many instances, result in the phenomenon that the combined costs of entry into two or more markets entered in the proper sequence is lower than the costs of entry into a single market entered prematurely.

Orphan Products

In certain cases, an economic justification may not be had for a stand alone or single market entry.  This is true of many product applications within the assistive industry.  Such products have been labeled 'orphan products', reflecting the unwillingness of any for profit business to sponsor the manufacturer and distribution of such product.

However, an economic justification may be made for multiple market entries.  When this justification is made upon the basis of economies of scale, then it is appropriate to implement 'universal design'.  When the justification is dependent upon market analysis and sequential entry into markets with least resistance to entry, then it is appropriate to implement a 'universal commercialization strategy'.  Such an approach will have a greater impact than that of 'universal design'.  It should result in less 'orphan products' and more viable product applications within the assistive market.

Karl Dakin

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