General Forum

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

Rookie — Mon, 20 Dec 2010 12:24:49 GMT

Well Dude1,

we had a long discussion about what we might expect from B&O in another thread ... and this is, what some people think about it ... please check the "list of innovations" [:'(] at the end of the quoting:

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Rookie:

"At the end of the day, the forum is held hostage by a vocal minority who judge anything but a free TV with an Apple logo as one more nail in B&O's coffin"

Sorry, but this is completely without substance to me. You don't want to lead a discussion based on facts and features. Instead you are constantly repeating the description of a static customer scenario. Don't you think it is highly unlikely, that things will stay the same. History has a quite obvious answer to that.

Things are changing day to day. I've watched it happen for many years.

Rookie:

Do you really think, that the generation of "digital natives", who have a quite educated understanding of the technology they are using every day, will be your customers in a few years, if the products and the philosophy behind that stay the same ? In fact you won't have the choice ... you have to please the people you are constantly nagging on nowadays ... 'cause they make the money needed to be spent on B&O products.

The philosophy should stay the same: Make technology pleasurable & accessible. Maintain high performance. Focus on design. Etc. Straying from sound core philosophies is what strands companies in the wilderness. We've been there before. So has Apple. So have others. Some made it back. Some didn't. We did.

The products haven't stayed the same. In the past year we've released an all digital music master and an iPod dock. When the BeoSound 5 was released BeoWorlders whined that it didn't have a CD slot. Looks like B&O was too oriented to the future. In the coming year we'll introduce a second all digital music master at a price point that will make it our least expensive audio system.

Rookie:

You can experience a similar development/challenge in the global premium automotive market. Innovation is the key to survive, not stagnation.

Right. Ok. I don't recall anyone advocating stagnation, but it feels good to say things like this.

Rookie:

Of course i understand why you might like your type of customer ... it might be a nice service fee business ... but it might also be, that educated customers WANT to understand, what your product is capable of ... he might demand clear structures and clean technical designs, so that he can fix things himself, because he simply doesn't want to wait for somebody to come ... not talking about the challenge to find a qualified service partner.

Not the case. Sorry. A modern Mercedes doesn't even have a dipstick to check your oil. This is not consistent with the points you're making above about technological stagnation. It is absolutely beyond the understanding or interest of all average consumers to start cracking open computers and stereos to fiddle with things. It's not 1950 anymore.

Rookie:

I cannot see why somebody who is discussing about a new level of product quality, is less of a B&O enthusiast. I don't think so. They are only trying to discuss quite essential demands ... and i think they care a lot about the B&O brand. Is that so hard to understand? Or is it more of a generation conflict e.g a question of age?

Discussing different levels of quality doesn't preclude you from being a B&O enthusiast. Again, no one has said it does. See red herring. What precludes you from being a B&O enthusiast is a complete and total disdain for B&O. Just as finding cooked broccoli precludes one from being a cooked broccoli enthusiast. When the Olive was brought up as a potential alternative it was treated, at least by me, as a serious competitor. I find a few things about it wonderful, most of all that it supports the idea of "high end digital music" which was (and still is in many circles) an oxymoron. I don't think I'd buy one, but I haven't taken the time to join the Olive forum and share my thoughts on exactly what's a "nail in their coffin" and what's "a missed opportunity." I'll also remind you that while anyone can tell that Puncher has probably resigned his post in the Trip English fan club I conceded my agreement on several of his issues with the BeoSound 5. I only added some color commentary as to why most of them have proved to be less important the longer I use it.

Rookie:

As some people linked the discussion with the Porsche story ... there you can find a very good example of how threatened a company was by sticking to the past and denying the development of the rest of the world ... if they hadn't changed from aircooled models to watercooled technology with features never seen in Porsches before ... and produced in a totally different way ... they would have been dead by 1997. Instead they adapted their products to the markets without loosing too much of the Porsche DNA. The rest should be known.

I think you missed the point of that story. Porsche diluted its heritage as a performance car company by building SUVs, bargain baby-porsches, and now giant sedans against the blood-curtling howls of "enthusiasts." Let's call them Porscheworlders.

In case you haven't paid attention, we have, in the past year alone,

1. Phased out MasterLink in favor of a Cat7/Wireless standard called NetLink.

2. Designed and brought a TV to market in less than 18 months and responded to market demand with additional sizes in a matter of months.

3. Phased out our touch remote in favor of an upgraded design that includes an HD Retina Display

4. Introduced an iPhone app to control an entire home AV system and attached automation

5. Produced the best sounding iPod dock ever made

6. Introduced a video matrix solution to allow all TVs to share and control a single set of sources

7. Introduced an all digital audio master

Next year we'll add to the world of iPod accessories, iPod control, WiFi remote control, media management, and more.

Apparently B&O is moving so fast you're not able to keep up.

Rookie:

Please stop to reduce this discussion to an Apple/B&O bashing. That is not the point.

Cheers

Tim

Look Tim (and everyone else who returned those "I Love Trip English" jackets I mailed out), I'm not saying that there should be a walled garden where only empty praise is heaped on a naked emperor. But when the criticisms are too disconnected from the reality of what we do, I point it out. When they're relevant I chime in. When they're spot on, I agree. Aside from Soundproof (who wrapped a trout in his TE jacket before returning it), I just don't see much worthwhile contribution. At least not enough to let so much baloney slide.

Peace & Love

-Trip Percival Wulfric Brian English

------------------------------------------------------------------------

Understand that? I don't.

I'm with you ... innovation is the key ... not late following the innovation leaders.

Best regards

Tim

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

Dude1 — Mon, 20 Dec 2010 10:44:26 GMT

I read this with interest. I met with an exec who is leaving the company recently. He cited differences with management and an increasingly unworkable approach to business, which began to wear him down and he mentioned a very subdued atmosphere.

Costs: I have my own opinions about B&O. Firstly, some of their products are magical, really fantastic (BV10 / BV7-55 / speakers) and depsite increasingly overwhelming costs that appear to be out of sync with the whole electronics industry. I understand that some costs will increase, but some of the increases year on year appear to be bordering on criminal. I think that streamlining the production - common internal components and developing component innovation will help to minimise some costs. But in reality, this should have happened long ago. I worked for a small manufacturer and this was something commonplace. Some boards would cost be more expensive in lower cost products, but overall the commonality bought many economies of scale. Also, by producing more (if they sell more), the company can use this buying power to develop their negotiation power.

Differentiation: I also believe that B&O have moved far too far away from the magical elements that made them different. The BV7 is now a very old product - over 7 years old. It's design has stood the test of time, but truth be told, it could be argued that a lot of other brands have caught up and are taking over. It's time for a new BV7 (I know the BV10 is out) but I mean a similar unit with many placement options and very powerful speakers. It needs fresh thinking - I'm talking about ALT type thinking, where the TV's can stand on their own. Lets say a 3D TV without the need to wear those insidious glasses - what about a new generation of colours and materials, what about the very best in screen technology and stands. Make people proud to own a B&O TV and to have people really say WOW. I mean the BV10 wall bracket is limited. What about a stand that can pivot and move on an axis made out of beautiful crafted aluminium?

The BS5 is a mixed product. It's not too bad, but whay isn't there a touch screen? Why can't we play CD's? What can't it be more portable with some great type of battery system? Why do we have to use the pathetic BEO5? Why has it taken 5 years for an IPOD dock? I mean did the execs get around a table and think 'yeah that apple, give it a couple of years and it will go away'. Come on. Now we have the BS8, but what about making it look good, making it real B&O, not somethign that could be mistaken for a Teac.

Manufacturing: It reminds me of the Wendy's ad 'wheres the beef?' I mean now that they are making things in China etc, what are they saying? Are they saying, 'yeah, for years we told you we have to make it in Struer to be real quality'. Was this lies? I know not everything is made in China, but more should be made in Struer. Get it going. Have some pride. Make it happen.

Blue Oceans: The B&O i used to know would make little boys stop and stare. It would make them save money to buy something from Denmark, rather than blowing it on other things. It would make them travel to little shops to look and listen. Now people couldn't care less. Now its all pretty much the same. I mean a Sony TV is pretty good, so is a Sharp, or a Panasonic, or anything else. They aren't too bad. What it needs is to consider developing Blue Oceans, like ALT. What about some new way of integration, with the internet or wirelessly. What about a Television that has 3D without using the glasses? What about some great new designs, using great new materials? What about a way speakers can recognise the TV and be set up easier / linking - who knows. They need to stop competing with the other players and start creating the new, blue oceans. Better ways of doing more with their products. What about a fanstatic way of interacting with music, not one dimensional - the BS9000 did it years ago.

Im really ashamed of the B&O I know at the moment, churning some stuff out, like some of the new phone products which don't work properly. It's one of the stongest, coolest brands in the world, but it doesn't seem to stand for anything anymore. It just makes better than average stuff. Thats not the company I know, and I am and many are passionate about.

I would strongly recommend that they don't sell the company to some other manufacturer like Sharp. It will just end in tears. It can survive - look at Hermes and companys like this. It just needs a huge injection of passion and people who are willing to push the boundaries. I for one hope they will stop fighting and start to focus their energies on saving a company that people give a damn about.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

Alex — Fri, 17 Dec 2010 09:36:16 GMT

bsantini:
The main problem, as i see it, is that B&O is currently in a similar position to Porsche of the early 1990's: Their costs of manufacture are too high. B&o is attractive, but too expensive in a fast-changing tech environment.

In addition, their insistence on diluted and obscure product instructions (guides) and the almost complete cessation of direct tech support is unforgivable, imho.

I am middle class, and would like to, step by step over the years, extend the concept of seemless control to my home through automation.

My dealer is really useless in this regard, as they are only interested in selling just. About the entire home system at once...or nothing.

A bad path to take, if you ask me.

OMO.

B

Sounds like you've been dealing with the wrong dealer. I'm in it for the long haul ... If you want some "long term" guidance through that process feel free to contact me any time.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

TripEnglish — Thu, 16 Dec 2010 14:02:25 GMT

My hope for the strategy is that we meet the economic thaw right as the new single-board / IP standard tech is implemented. This will keep product prices down in the long run and allow us to bring new products to market very rapidly. The BeoVision 10 has been a big hit because the price point is much more in line with a "step up" from Samsung than a BeoVision 7-55, which really requires a totally different affluent buyer. I've lost more BeoVision 10 sales because of the form factor than the price.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

symmes — Thu, 16 Dec 2010 11:15:55 GMT

I wish I could read German, because the Google translation was a little confusing. That being said, to think (and even worse, write) that one person can lead a mature and progressive turnaround in a Scandinavian culture and in this economy any quicker/better than is being done at B&O, should not be a business columnist for a proper news service. That article sounds more like the immature blathering of a Goldman Sachs MBA hedge fund leech (I am sure TripEnglish has had a few in his store).

If the rules of the "street" won't give Bang & Olufsen the time and resources to continue the path, its demise will be nothing but a blip of much worse nastiness to come. So be it. We were all born without a job, and will die the same way.

I don't think that proclamations (including mine) about B&O's strategy have any merit unless they came from the mouths of the designers and those accountable for their implementation. I wish I had a facility to buy shares, because I believe the business strategy makes sense. I could also be impressed with any lower cost/high quality manufacturing strategy that isn't dependent upon Asia for success. And I believe in Santa Claus.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

soundproof — Thu, 16 Dec 2010 09:03:46 GMT

Unfortunately, some of the people responsible for the strategy in the U.S. and in Asia/Emerging markets managed to sidetrack B&O into becoming exploitative rather than explorative -- and until that's sorted out, the brand will be at the mercy of the shifting seas and not in control of its journey.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

symmes — Thu, 16 Dec 2010 08:44:09 GMT

bsantini:
The main problem, as i see it, is that B&O is currently in a similar position to Porsche of the early 1990's: Their costs of manufacture are too high. B&o is attractive, but too expensive in a fast-changing tech environment.
In addition, their insistence on diluted and obscure product instructions (guides) and the almost complete cessation of direct tech support is unforgivable, imho.
I am middle class, and would like to, step by step over the years, extend the concept of seemless control to my home through automation.
My dealer is really useless in this regard, as they are only interested in selling just. About the entire home system at once...or nothing.
A bad path to take, if you ask me.
OMO.
B

Then you are talking to the wrong dealer. NY Metro has the largest concentration of dealers in North America. I cannot think of an entertainment product company who wouldn't rather sell whole-house but, no matter what some people might say and until there is a stated strategy saying differently, it is B&Os job to sell B&O stuff in ways that please their customers. I am sure that we all agree the best way to change a public company is to vote your shares. PS: Interesting Porsche analogy, but B&O doesn't have VW and Audi available to keep manufacturing in the family. Too bad.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

TripEnglish — Thu, 16 Dec 2010 08:06:06 GMT

I was not consulted, but had I been I would have said, "Listen to BeoWorld."

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

mbee — Thu, 16 Dec 2010 07:55:55 GMT

bsantini:
The main problem, as i see it, is that B&O is currently in a similar position to Porsche of the early 1990's: Their costs of manufacture are too high.

There latest product strategy seems very good : same internal parts between BV10 and BV8, modular conception. The New BS5 Encore should also be the first audio system with a new core technology which will be the engine of future other systems. They are developping a cross-product platform for each kind of product instead of developping a new mainboard for each product. That's the good way. And by the way, more and more products are manufactured in China (BS8). I'm not sure the issue is product-based.

Maybe the other members of the board just want the share to rise with high rentability products such as BV4-103 and, as you say, full system at once, instead of a little iPod dock for the masses. Quick rentability instead of long term brand construction... I'm not sure where they want to go...

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

bsantini — Thu, 16 Dec 2010 07:32:54 GMT

The main problem, as i see it, is that B&O is currently in a similar position to Porsche of the early 1990's: Their costs of manufacture are too high. B&o is attractive, but too expensive in a fast-changing tech environment.

In addition, their insistence on diluted and obscure product instructions (guides) and the almost complete cessation of direct tech support is unforgivable, imho.

I am middle class, and would like to, step by step over the years, extend the concept of seemless control to my home through automation.

My dealer is really useless in this regard, as they are only interested in selling just. About the entire home system at once...or nothing.

A bad path to take, if you ask me.

OMO.

Re: Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

Stonk — Thu, 16 Dec 2010 06:57:08 GMT

English Google translation of the German FT HERE

Bang & Olufsen Chairman Brian Petersen Leaves Over Strategy Disagreement

Rookie — Thu, 16 Dec 2010 06:09:08 GMT

Hey Tripenglish,

did he talk to you? Maybe he got quite desperate afterwards [:'(]

Here is some info:

http://www.bloomberg.com/news/2010-12-15/bang-olufsen-s-chairman-petersen-leaves-due-to-disagreement-on-strategy.html

The german comment has a bit more background to it:

http://www.ftd.de/it-medien/computer-technik/:edel-hifi-hersteller-bang-olufsen-stuerzt-in-fuehrungskrise/50205882.html

Hope they make it ... in time!!!

Regards

Tim