Discussion Question:
ABC Enterprises started their operations in beverages industry during 2005. Keeping in view the preferences and needs of their customers company introduced different products and expensed out lot of budgeted amount in R&D department. Despite the huge amount of expense in R&D some conflicts appeared between marketing and operations departments regarding the life cycle of their products. The proposals of experts from both departments were on contradictory ends. So, it was decided that under the direct supervision of CEO, a team of experts from both departments will be made to come up to a single approved opinion regarding the product life cycle (PLC).
You being an operation manager suggest the company regarding the following issue:
Requirement:
Is it beneficial for the company that the PLC of their products becoming longer or shorter? Give reasons why or why not?
Idea solution
Cycles of Products or Services normally entail the following phases.
INTRODUCTION PHASE: When items are first introduced, it is received with curiosity. Demand is low in the beginning then when buyers begin familiar with the product and see it as a reliable and good buy, they start buying it.
GROWTH PHASE: With the passage of time, production and design improvements lead to decrease in cost and price becomes an attractive feature with increase in reliability.
MATURITY PHASE: When the product reaches maturity stage its demand can only increase if design is refined or changed and some differentiation feature is added this may increase the demand but when it goes down
SATURATION PHASE: In this phase product demand declines and the market is saturated with either a compatible product or substitutes.
DECLINE: In this phase, most of the organizations adopt a defensive design R&D Strategy in an attempt to prolong the life of the product by employing new packaging, redesigning it, improving its reliability.
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