What New Product Rollouts Taught Me About Obamacare

I spent my 35-year career marketing test systems called Automatic Test Equipment (ATE), which are machines used by electronics manufacturers to test semiconductors and printed circuit boards. ATE consists of highly complex hardware and software systems, and a single test system costs anywhere from $100,000 to upwards of $1,000,000. These machines have been used to test every piece of electronics we own. Because of changing economic conditions, competition, and evolving technology, it was imperative that we were always continuing to develop and introduce new products. We introduced new ATE models to our market about every 18 to 24 months.

As with automobiles, ATE is built on a basic “platform”—the system’s core hardware and software—that endures over several generations of new products. “New products” are simply improvements, upgrades, and repackaging of the basic platform.

RolloutNew product launches–or “rollouts” as we called them–usually went pretty smoothly.

But about every five years or so, evolving technology, increasingly stringent customer demands, and the desire to stay ahead of the competition meant that we had to specify, build, and introduce a completely new platform, building everything fresh from the ground up. This was a much more complex proposition than just transforming an existing product into a new one, since everything about the core platform was completely redesigned. Creating a new platform is an inherently complicated and risky engineering task, and it always took longer and cost more than even the most pessimistic of our estimates.

The rollout of a new platform is always bumpy, and in my experience, it often created unintended consequences leading to many sleepless nights. Everything that could go wrong usually did:

  • Missed deadlines; it was always later to market than originally planned.
  • Cost overruns that made the new platform more expensive than planned.
  • Features that didn’t work as specified.
  • Promised features that turned out to be impossible to implement.
  • Features seen as essential to the product’s success that were simply missing.
  • Numerous software bugs that would crash the entire system.

This resulted in:

  • Permanently downgrading some of the platform’s more ambitious specifications.
  • Fuzzy marketing messages where promise and reality diverged.
  • Angry and/or confused customers.
  • Desperate salespeople having to reassure their customers that fixes were “just around the corner,” and that everything would turn out fine.
  • Competitors telling customers that the whole product was a disaster and would fail totally.
  • Competitors saying the product was so bad that our entire company would fail.
  • The president of the company having to go in and reassure an important customer.

A couple of times, the new platform was a bust and failed in the market. But most of the time, we survived the bumpy rollout, and the product eventually went on to success. But getting to that point wasn’t easy or any fun for anyone.

Sound familiar?

The Affordable Care Act, aka Obamacare, is a new, “from the ground up” platform. It’s vastly more complicated than even the most complex ATE. Its rollout into the market is already proving to be contentious, messy, behind schedule, over budget, and profoundly confusing—and surrounded by enthusiastic naysayers wishing for its immediate demise by whatever means they can think of.

A desperate presidential salesman has been running around the country, trying to assure potential customers that things are just fine. Competitors are not only predicting the product will fail, but they’re trying to pull the fiscal plug on it or mortally wound it. (Something competitors don’t get to do in the real, non-Congressional world.)

Regardless of the politics surrounding Obamacare, the first months, perhaps years, of this new product rollout are going to be chaotic, full of unanticipated surprises, poorly implemented features, cost overruns, and promised benefits that will never see the light of day.

Then there are the customers. Will the young demographic that’s supposed to support all of us older folks with chronic diseases like cancer show up to buy insurance? What about other human factors that we ATE marketers didn’t have to worry about? Like not enough doctors?  Or the misuse and even fraud that one ER doc knows he’ll be seeing up close and personal?

One Wall Street Journal pundit declares, “the odds of ObamaCare’s eventual self-collapse look stronger every day.”[1]

Perhaps. But based on all those bumpy rollouts I lived through, I’m betting something resembling a revised health care system will eventually creak slowly and painfully into the market. There will need to be massive tinkering under the hood to fix its numerous, often egregious bugs. Whatever it becomes, it will never that bright, shiny, high performance health care platform promised back in 2008 that everyone was just guaranteed to love.

Like our customers for those new ATE platforms, we’ll have to learn to live with Obamacare’s shortcomings. But we need to remember: the sales pitch is always more alluring than the actual product.

[1] Daniel Henninger: Let ObamaCare Collapse; Wall Street Journal, September 25, 2013.

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