New Age Of Innovation | The Nuances Of N = 1 | C.K. Prahalad & M.S. Krishnan

November 22, 2008

The Nuances Of N = 1
Posted by C.K. Prahalad | May 13, 2008

Is N=1 the same as "mass customization" or the customer strategy known as "segment of one?" The answer is no -- not at all.

Mass customization allows me, the consumer, a chance to choose from a menu of products, sub-systems that I have built or have access to. It is the firm’s determination of what I "may need." And this can explode into a combinatorial problem -- a billion choices for building your laptop, which used to be advertised as a single entity by Toshiba.

Segment of one targets one customer at a time by learning a lot about his or her demographics, spending patterns, etc. This is a “firm centric” view of the customer, still a B2C view, if you will. This is still the firm learning about consumers.

N=1 changes this B2C view. It is a C2B2C view. Consumers are joint problem solvers.

Are the 6,000 application developers for Facebook part of “segment of one” or mass customization? The same holds for EBay or the videogame business, where customers are active participants online. How about all the bloggers for the New Age of Innovation site? Are they passive recipients of the knowledge in the book or co-creators of new knowledge?

N=1 is about "personalized, co-creation of experiences"-- not mass customization or the customer of one. These nuances are critical.

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