And the iPhone Gets Criticism for 3 Years
Apple has taken huge amount of criticism for letting the iPhone go a third year without a visual design change. Prior to the launch of the iPhone 7 all the analysts were predicting doom and gloom since they assumed that the iPhone 7 was being setup for failure by ensuring weak upgrade sales. It’s too soon to say how this will turn out for Apple. But I saw my old accounting chief, Herman Miller CEO Brian Walker, on Jim Cramer’s Mad Money talking about his icon’s first redesign in...wait for it... twenty two years. I couldn’t help but chuckle at how much faster tech moves than just about anything else. I know you can't compare tech to furniture but indulge me for a minute.
The Herman Miller Aeron chair is the iPhone of the office furniture world. It’s designed with the user experience being prioritized above price. But this greatly limits your potential market so you have to price it accordingly. If you can’t afford it, that’s your problem, not Herman Miller’s. That’s why iPhones, MacBook Pros, and Aeron chairs end up as aspirational products and status symbols. In most Fortune 500 corporate offices only the cream of the crop gets an Aeron chair. So if you get a new one, it means your superiors greatly value your work.
Herman Miller learned a long time ago that heat is one of the things that can make or break how comfortable you are when you sit. Therefore, if you’ve never sat in or seen an Aeron chair you might be surprised to see that there’s no cloth or stuffing anywhere. You sit in sort of a net called the “pellicle”. It prevents heat buildup and is more comfortable than you can imagine.
We made Aeron chairs in the manufacturing plant which I supported as an Operations Analyst so I’m well acquainted with the product. As such, I’m probably one of the few people who would recognize that when Brian says that they can build an Aeron chair in 22 seconds, he’s actually probably talking about takt time. He didn't mean that some super human assembles a chair in 22 seconds. The takt time means that to hit their production goals the manufacturing line has to hit a cadence of a finished chair exiting the assembly line every 22 seconds. So you’d have to multiply 22 seconds by the number of heads on the line to get total labor. Which makes more sense because how much labor is actually in a chair is a closely held secret that Herman Miller wouldn’t want their competitors, who they bid against, to know.
So after twenty two years it is getting it’s first redesign. Why so long? Well, think about it for a minute. Redesigns also have a lot of inherent risk. Just ask Samsung how their Note 7 redesign is working out for them. If you already have an iconic hit, it means that it works pretty well and people like it. Now you want to change the formula? You had better have a very clear vision of where you’re headed before you start tinkering with a design that works.
I learned a lot working at Herman Miller and no other job assignment has influenced how I see manufacturing and finance more than my time there. Even working under Brian Walker, who was the CFO at the time, has colored my world view. His integrity and resolve to never wish for ill on competitors but simply that we do our best and hope that we all do well has always stuck with me.
In the late nineties, Brian had me accompany him and a few others on a trip to South America to scope out a potential acquisition. That’s where I began to realize how interesting the business world is if you really pay attention. Acquiring businesses to offset a weakness or get a head start in a new market was like a high-stakes chess game. Business is only boring if you don’t understand it. It’s more like the NFL where various teams are going head-to-head or jockeying for position within their divisions.
Kudo’s to Herman Miller and Brian Walker for getting a prime spot on Mad Money. Herman Miller makes quality furniture and Brian Walker is an excellent example of a CEO doing it the right way. I look forward to seeing how their redesigned icon does in the future.
We made Aeron chairs in the manufacturing plant which I supported as an Operations Analyst so I’m well acquainted with the product. As such, I’m probably one of the few people who would recognize that when Brian says that they can build an Aeron chair in 22 seconds, he’s actually probably talking about takt time. He didn't mean that some super human assembles a chair in 22 seconds. The takt time means that to hit their production goals the manufacturing line has to hit a cadence of a finished chair exiting the assembly line every 22 seconds. So you’d have to multiply 22 seconds by the number of heads on the line to get total labor. Which makes more sense because how much labor is actually in a chair is a closely held secret that Herman Miller wouldn’t want their competitors, who they bid against, to know.
So after twenty two years it is getting it’s first redesign. Why so long? Well, think about it for a minute. Redesigns also have a lot of inherent risk. Just ask Samsung how their Note 7 redesign is working out for them. If you already have an iconic hit, it means that it works pretty well and people like it. Now you want to change the formula? You had better have a very clear vision of where you’re headed before you start tinkering with a design that works.
I learned a lot working at Herman Miller and no other job assignment has influenced how I see manufacturing and finance more than my time there. Even working under Brian Walker, who was the CFO at the time, has colored my world view. His integrity and resolve to never wish for ill on competitors but simply that we do our best and hope that we all do well has always stuck with me.
In the late nineties, Brian had me accompany him and a few others on a trip to South America to scope out a potential acquisition. That’s where I began to realize how interesting the business world is if you really pay attention. Acquiring businesses to offset a weakness or get a head start in a new market was like a high-stakes chess game. Business is only boring if you don’t understand it. It’s more like the NFL where various teams are going head-to-head or jockeying for position within their divisions.
Kudo’s to Herman Miller and Brian Walker for getting a prime spot on Mad Money. Herman Miller makes quality furniture and Brian Walker is an excellent example of a CEO doing it the right way. I look forward to seeing how their redesigned icon does in the future.
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