It has long been acknowledged within the technology industry that hardware is usually significantly more challenging to bring to market than is software, due to the complexity of manufacturing, supply and geographic issues involved. The current hardware resurgence puts an even brighter spotlight on supply chain issues that already are becoming a global challenge.
Respondents also believe that companies funded on Kickstarter and Indiegogo will have the lowest likelihood of successfully manufacturing and delivering their products on time. CIOs agreed that companies funded by private equity, venture capital and incubators are most likely to launch on time.
Of the CIOs polled, 76 percent agreed that the recent resurgence in entrepreneurial interest in hardware manufacturing is likely a result of the public’s interest in the Internet of Things. Fifty-two percent attributed it to the public’s interest in wearables and 36 percent felt the resurgence is due to fact that it is cheaper to manufacture hardware than it has previously been.
When the CIOs were asked to weigh in on which funding mechanisms made them skeptical that a product would launch on time, 50 percent picked crowd funding platforms Indiegogo and Kickstarter, suggesting that CIOs have low expectations that fledgling entrepreneurs will be able to deliver hardware manufacturing projects on schedule. The next two funding mechanisms that inspired the least confidence among the CIOs surveyed were “big brands’ first foray into hardware” (20 percent) and “family money” (17 percent).
The CIOs surveyed agreed that manufacturing delays pose a significant threat to the potential viability of a given product and the long-term success of a company. When asked what consequence a company would most likely face if it is unable to deliver a product on time and to scale, over half (54 percent) agreed that “going out of business” was the most likely to occur.
Forty-six percent of the CIOs surveyed said most entrepreneurs optimistically believe they can bring a product to market in 6 to 12 months. When asked what is the most likely cause of manufacturing delays, 38 percent of the CIOs said it was because entrepreneurs go straight into manufacturing and 33 percent pointed to the fact that companies do not adequately pilot and test products.
Source: Riverwood Solutions
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