Answer to Question #201935 in Management for Karabo

Question

2

(A) Your organisation wants to broaden its products portfolio by introducing a new product. In order to achieve that, you have requested your cross-functional team to evaluate and oversee the procedures to ensure the new product is effectively developed. 

In view of the presented case, provide a practical elaboration of how the following process will be carried out to develop your new product: (30 marks):

• Use of cross-functional teams for supplier evaluation and selection (5 marks)

Answer 1

a) In view of the presented case, provide a practical elaboration of how the following process will be carried out to develop your new product:

1) Meeting users’ needs- a good product launch plan should always put consumers’ needs first and satisfy them by providing a overwhelming new value that encourages the consumers to flock and purchase it. An effective way to do this is to survey the market; answer the question, why would someone buy your product? Figure out how your product could solve a problem, satisfy a desire or improve someone’s quality of life. These are all reasons why people buy things. What is your product worth to your customers? Not “worth” in the way of monetary value, but how it adds value to their general state of living. Understanding how your customers justify buying your product is how you can begin a promotion strategy.

2) Know your competition- knowing what your competitors offer to make your marketing, products, and services to stand out enables one to set prices competetively, and respond to viral marketing campaign with oneself's initiatives. What sets your company and your product apart from a similar brand or product?, Why should consumers choose your product over the competition?, The brand?, The flavor?,The price?, and Identify unique advantages. How can you grab the attention of your audience so they trust that your product will fulfill what other companies can’t?

3) Make a prototype and test it- Create a finished product through the use of samples for mass production to come up with several versions, and slowly eliminate options and make improvements until satisfaction is achieved with a final product. Therefore, it helps to avoid the risk of investing in a product that is defective before it hits the market, hire better testers to try it so they can offer feedback on how to improve it this,helping your business to dodge undesirable customer reviews that may damage your credibility in the industry, causing partners and investors to do damage control in having to justify their involvement with your brand.

4) Reconfigure your product- this is the establishing a strategy that enables a new single product to meet diverse needs of the consumers. Once you start testing your product and gain feedback from testers, friends, family, colleagues, anyone who can help eliminate the kinks, it’s imperative to adjust accordingly. Making subtle changes here and there can mean a world of difference in the product’s quality. Some of your friends may ask about a feature that you’ve never considered adding, or point out that something isn’t quite working that you can eliminate. Ultimately, it should be something consumers not just need, but want.

5) Run the numbers- it is wise to establish your profit margins as one of your product launch phases. Look at your existing products’ performance, if applicable, and determine the number of products sold, total revenue generated, break-even sales volume and net profit earned. Then, work backward to figure out what numerical goals make the most sense. You need to decide what to establish as a reasonable website conversion rate and then figure out how much traffic you need to reach that goal.

6) Build anticipation by pre-marketings- a successful product launch plan is only as good as the work your marketing department put into it. If you try to build anticipation among your audience by promoting the product prior to launch, the awareness will be more prevalent, helping drive more sales on a new product.

A few clever ways to initiate a new product promo involves:

a) Create a landing page about the new product on your website.

b) Create an email campaign that encourages signups to learn more about the product.

c) Reach out to bloggers, journalists, and industry influencers that can help create content that will tease the product

d) Reach out to presseps to create an embargoed press release that will have all media outlets talking about your product at the same time when it launches

e) Depending on your budget, you should advertise in as many appropriate places as possible that receive enough traffic to generate interest

f) Create the content early so you have perfected ad copy and images that you can use when your product is ready to be presented.

7) Build a solid supply chain

It’s important for business owners to take inventory of their products and ensure they have enough to meet demand. The best way to do this is to establish a manageable supply chain. Work closely with your vendors and ask them what their maximum capacity is for how many units they can provide at one time. Then, collaborate on how to scale production in the event that your product launch yields more demand over supply.

8) Network and share your product- this is the time to launch. Once you have set a launch date, stick to it. This will mitigate having to update the media, customers, vendors, anyone involved, of any changes. Start to promote the new product on your landing page, your email campaigns, and social media, and encourage your contacts to spread the news as well. Make sure you get the public’s attention on every platform available by reposting and sharing reminders in the subsequent days of launching.

9) Reach out to the press post-launch- once you have launched your product, and good reviews and feedback start rolling in, reach out to the press firms and media outlets that covered your story pre-launch and ask them to share an update. Take your audience on a journey from inception, to production, to commerce. People love to hear the origin of a great product, especially if they started out as accidents. Does your company have a great product story? Therefore, share the story through different platforms such as Twitter e.t.c.

10) Consider public feedback post-launch- since the product is available, brace yourself for customer reviews through Google and other sites made for customer feedback. No matter how successfully you have introduced your product to the world via a comprehensive product launch plan, public perception of your brand can be brutal if your organization overpromised and underdelivered.

If you receive a negative review, be empathetic and always respond with a positive greeting and provide a short-term solution to address the consumer’s immediate concerns and a long-term solution to ensure future customers won’t encounter the same issues. Addressing reviews and feedback whenever possible demonstrates how invested you are in your product and your customers’ happiness, which, in the end, will result in more loyalty and devotion to your brand.

b) Use of cross-functional teams for supplier evaluation and selection

supplier evaluation and selection process

Regardless of the approach, the overall objective of the evaluation process should be to reduce purchase risk and maximize overall value to the purchaser. Depending on the approach, the process can be an intensive effort requiring major commitment of resources.

The steps of the process are as follow:

1)Recognize the need for supplier selection. The engineering personnel provides some preliminary specifications on the type of materials service, or process required, but will not have specific details. This information may be enough to justify beginning an initial evaluation of potential sources of supply.

2) Identify key sourcing requirements.It is important to understand the requirements that are important to the purchase. These are determinedby internal and external customers within the value chain.

3)Determine sourcing strategy.The purchasing strategy adopted for a particular item or service will influence the approach taken during the supplier valuation and selection process. The key decisions that must be made during this stage are:

i) Single versus multiple supply sources.-Short-term versus long-term purchase contract.-Selecting suppliers that provide design support versus those that lack design capability.-Full service versus non full service suppliers.-Domestic versus foreign suppliers.-Expectation of a close working relationship versus arm’s length purchasing.

4) Identify potential supply sources.Purchasers rely on various sources of information when identifying potential sources of supply. The degree to which a buyer must search for information or the effort put forth toward the search is a function of several variables, including how well existing suppliers can satisfy cost, quality, or other performance variables. The strategic importance or technical complexity of the purchase requirement also influences the intensity of the search. Some guidelines:-High capability of current suppliers + high strategic importance of requirement = minor to moderate information search.-High capability of current suppliers + low strategic importance of requirement = minor information search.-Low capability of current suppliers + high strategic importance = major information search.-Low capability of current suppliers + low strategic importance = minor to moderate information search.

Examples of good sources of information when seeking to identify potential suppliers:-Current suppliers. The purchaser doesn’t have to add and maintain an additional supplier, and they are familiar with them, which saves time and resources to evaluate a new one.