Device manufacturers' 'Holy Trinity'

It's tough being a device manufacturer in today's marketplace.

The global market has recently seen increased competition from new players that has had a commoditizing effect across the spectrum - from medical devices and telecommunications equipment to oil and gas machinery and building automation. Complex supply chains and rising commodity, fuel and transportation prices are driving up manufacturing costs and margins down. Today’s rapidly evolving markets and changing customer needs require a heightened flexibility and nimbleness that most old-line manufacturers simply don't have.

While many device manufacturers are collapsing under the pressure, some are succeeding - exceptionally. The new winners in the global economy enjoy tremendous profitability, high margins and virtually infinite product customization capabilities. Their strategy represents the future of manufacturing.

Their formula for success should be copied by all manufacturers seeking to remain competitive – it could be referred to as a Holy Trinity. The strategy lies in the ability to become a solutions provider. The way to do this is by going intelligent.

The formula for intelligence is as follows: App-enabled Hardware + Flexible Licensing = Intelligent Device

As an example of how this works, look no further than Apple and the iPhone. Rather than manufacturing hundreds of different iPhone models, Apple only needs to manufacturer two or three. Built into these models are all iPhone functions and features: GPS, camera, light, voice, data.

The iPhone is an app-enabled hardware solution that allows the customer to download software to address particular needs. The functions and features on the device that get turned on and off – in different combinations, are defined by the app. As a result, the iPhone is personalized to the exact needs and specifications of the customer - accomplished almost entirely via the apps. This solution is almost indefinitely customizable, yet Apple only has to produce a few models (minimizing manufacturing costs).

Additionally, the functionality can be altered, enhanced and improved in the same amount of time it takes to download a new app.