This paper is an historical and tutorial review that examines the product development life cycle of a single laser product: the IBM 3687 Supermarket Bar Code Scanner. The intent of this paper is to reveal to the reader the manner in which this product progressed from the conceptual stage to the design and development of the final product. We will begin with a brief review of the UPC bar code and the basic concepts involved in scanning the code. We will then discuss the early IBM scanner products in order to lay the groundwork for the introduction of the 3687 scanner. The major portion of the paper will be devoted to a discussion of the technical factors involved in the design of the product once the marketing decision was made to develop the product. The discussion will include those factors that influenced the decision to use holography, the problems encountered in the use of this relatively new (to bar code scanning) technology, and the solutions of those problems. In fact, the major emphasis in our discussion of the various stages of this product development life cycle will be on the development and implementation of a holographic optical element as a key component in the 3687 bar code scanner. By 1977, when this product development began, the low-power Helium-Neon laser was already a tried and tested, well established component in supermarket bar code scanners. The holographic deflector disk was, on the other hand, completely untested in any low-cost, high-volume, commer-cial product. The unique capabilities and problems associated with the use of this device will be discussed. Note that most of the dimensions in this paper will be in inches instead of in metric units. This is consistent with the units generally used by the supermarket industry in the design and installation of supermarket check-stands, and with the units generally used by the UPC standards committees.