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THE sTRATEgiC imPoRTAnCE oF PRoduCT And sERviCE dEvEloPmEnT 279
Table 8.1 The degree of product/service change can affect both its external appearance and its
internal methodology/technology

Degree of product/service change
Modification Extension Development Pioneer
External customer Little/none More functionality ‘Next generation’ Novel/radical
awareness (what is progression change
seen)
Internal methodology/ Minor/isolated Some changes Extensive redesign Novel/radical
technology (how it is to original of original method/ change
done) methodology/ technology
technology
Example: exercise Minor engineering Extra options on Aesthetic redesign ‘Total health
machines change to control/display of and changes to monitoring’ concept
component parts computer internal resistance with intelligent
mechanism machines’ response
to body monitoring
and full automatic
analysis

Example: bank card Minor changes Improvement of Incorporation Ultimately flexible
services to back-office monthly statement of smart-card ‘one card’ concept
procedures with analysis of technology with advanced
expenditure smart-card
capability and links
with other financial
services

Example The troubled history of the Airbus A380 development 4
Every four minutes, 24 hours a day, seven days a week, an Airbus A380 is taking off or landing
somewhere in the world. ‘Seventy-five million passengers have paid to be on this aeroplane’,
says John Leahy, chief operating officer of Airbus. ‘They seek it out – it is a market share mag-
net. If you put it on a route, the airline picks up market share.’ But, when the aircraft was being
developed, its future looked less than successful. And if anyone ever doubted the importance
of product/service development to strategic success (or failure), they should look at the history
of the Airbus A380. Its development was a long and incident-packed journey from drawing
board to take off, was a good illustration of the dangers when the design activity goes wrong.
Airbus admits that the development of the plane cost €15bn, though some industry analysts
judge the figure to be at least €5bn more. Problems include years of delays in bringing the
product to market, discovering cracks inside the wings soon after it entered service and prob-
lems with the doors.
This is the story in brief:
1991 – Airbus consults with international airlines about their requirements for a super-large
passenger aircraft.
January 1993 – Airbus’s rival, Boeing, says it has begun studies into ‘very large’ commercial
aircraft.

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