Manufacturing and Swatch
Swatch Revolutionises Watch Manufacture
Answer
1. What do you think has been the contribution of the marketing function, the product design function and the operations function to the success of Swatch?
Swatch is a good example of the way three sets of competitive abilities in a company relate to each other. The three key contributions to Swatch’s success (or the three important micro operations) are
• the way they have developed their products and services.
• the way they have positioned themselves in their market.
• the way they have created their products and services.
The original stimulus for Swatch’s success lay in its product design. The Swatch design was particularly innovative, incorporating a plastic and designed with relatively few parts. This resulted in a watch which was robust, capable of being adapted to changes in fashion, and requiring relatively inexpensive parts and materials. This allowed the product to be positioned in the market place as an item of ‘mass fashion’. It was easily recognisable and stylish and yet sufficiently affordable to sell in large numbers. The design was also eminently manufacturable. Parts were standardised and the design intrinsically easy to make. This manufacturability combined with higher volumes further reduced the cost of manufacturing the product. The revenue implications of an attractive, high volume product, together with the cost implications of
2. How do you think Swatch compares with most watch manufacturers?
Swatch has a range of products which are essentially very similar, but customised ‘at the last minute’. This allows it to operate at relatively high volume and low variety for much of its manufacturing process. It therefore has a relatively simple and relatively cheap manufacturing operation, while at the same time allowing ‘mass fashion’ orientation of its marketing. Given this, Swatch will have a higher degree of automated machinery (because of the high volume and the standardised
Answer
1. What do you think has been the contribution of the marketing function, the product design function and the operations function to the success of Swatch?
Swatch is a good example of the way three sets of competitive abilities in a company relate to each other. The three key contributions to Swatch’s success (or the three important micro operations) are
• the way they have developed their products and services.
• the way they have positioned themselves in their market.
• the way they have created their products and services.
The original stimulus for Swatch’s success lay in its product design. The Swatch design was particularly innovative, incorporating a plastic and designed with relatively few parts. This resulted in a watch which was robust, capable of being adapted to changes in fashion, and requiring relatively inexpensive parts and materials. This allowed the product to be positioned in the market place as an item of ‘mass fashion’. It was easily recognisable and stylish and yet sufficiently affordable to sell in large numbers. The design was also eminently manufacturable. Parts were standardised and the design intrinsically easy to make. This manufacturability combined with higher volumes further reduced the cost of manufacturing the product. The revenue implications of an attractive, high volume product, together with the cost implications of
2. How do you think Swatch compares with most watch manufacturers?
Swatch has a range of products which are essentially very similar, but customised ‘at the last minute’. This allows it to operate at relatively high volume and low variety for much of its manufacturing process. It therefore has a relatively simple and relatively cheap manufacturing operation, while at the same time allowing ‘mass fashion’ orientation of its marketing. Given this, Swatch will have a higher degree of automated machinery (because of the high volume and the standardised