Lean principles and premium brands: conflict or complement?

Abstract

This paper explores the relationship between lean principles and success in markets for premium products. Drawing on data from two sectors — automobiles and high-end audio equipment — the paper notes that the development of premium brand products is often driven by strong organizational values, such as uncompromising technical excellence. These values can result in product attributes that are far in excess of functional requirements, which in lean terms represent waste. This implies that companies that adhere too narrowly to lean principles may be disadvantaged in niche, premium markets. This paper examines the interplay between product development practices, product attributes and market performance for premium autos and audio products, and discusses why Japanese companies (used here as proxies for lean product developers) are much less successful in premium, compared to mass, markets.

Keywords:

• Lean
• Marketing
• Product development
• Mass markets

Acknowledgements

Thanks are due to Emma Dewberry and Isabelle Dostaler for their role in the design and execution of the study of audio equipment manufacturers.