iRobot 2008 Annual Report Download - page 62

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Global Engineering
Our domestic research and development efforts are primarily located at our headquarters in Bedford,
Massachusetts, our office in Durham, North Carolina, and our special projects engineering office in San Luis
Obispo, California. In addition, we have an engineering design center in Mysore, India and a product development
team in Hong Kong.
Our global engineering development process for consumer products allows us to leverage the time differences
between our U.S. operations and our teams in Asia resulting in a fast, low cost global design and manufacturing
cycle. The first stage of the cycle takes place in both our Bedford, Massachusetts and Mysore, India offices where
we focus on product definition, prototyping, market research and financial analysis. We then create a design that is
manufacturable, including complete modeling and simulation and initial validation of the product/market concept.
After the initial development of the prototypes, we leverage the team in Hong Kong for the production stage of the
cycle. During this stage, engineers on two continents work on refining the designs, preparing the product for
manufacturing and working through the issues for pilot production. The product is then turned over to the contract
manufacturer for volume production.
Spiral Development
One of the methods we use to develop military products is a “spiral development” process to get field tested
equipment to the troops more quickly. After we develop a new product or product upgrade that will fulfill the
desired requirements of the user, the product is tested with soldiers in the field. The user provides performance
feedback on the product to the in-field engineer. Revisions are made quickly to retest in the field. This method has
allowed our research and development team to not only make revisions on existing products quickly and efficiently,
but also capture feedback for future upgrades and innovations to meet user needs. Periodically we send engineers in
the field with our PackBot tactical military robots to solicit feedback from users which is often times incorporated
into future product development and product enhancements.
Leveraged Model
Our research and development efforts for our next-generation products are supported by a variety of sources. Our
next-generation military products are predominately supported by U.S. governmental research organizations, such as the
Defense Advanced Research Projects Agency, or DARPA, U.S. Space and Warfare Command, or SPAWAR, Technical
Support Working Group, or TSWG, U.S. Army Tank-Automotive and Armaments Command, or TACOM, U.S. Army
Armament Research, Development and Engineering Center, or ARDEC, and the FCS program. While the U.S. gov-
ernment retains certain rights in the research projects that it has funded, we retain ownership of patents and know-how
and are generally free to develop other commercial products, including consumer and industrial products, utilizing the
technologies developed during these projects. Similarly, expertise developed while designing consumer products is used
in designing products for government and industrial applications. We also work with strategic collaborators to develop
industry-specific technologies. Moreover, we continue to reinvest in advanced research and development projects to
maintain our technical capability and to enhance our product offerings.
Competition
The market for robots is highly competitive, rapidly evolving and subject to changing technologies, shifting
customer needs and expectations and the likely increased introduction of new products. We believe that a number of
established companies have developed or are developing robots that will compete directly with our product
offerings, and many of our competitors have significantly more financial and other resources than we possess. Our
current principal competitors include:
• developers of robot floor cleaning products such as AB Electrolux, Alfred Ka
¨rcher GmbH & Co., Samsung
Electronics Co., Ltd., LG Electronics Inc., Infinuvo/Metapo, Inc, Matsutek Enterprises Co Ltd., Microrobot
CO., Ltd., ACE ROBOT Co., Ltd. and Yujin Robotic Co. Ltd.
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