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TerraCog Global Positioning Systems:

Conflict and Communication on Project Aerial

Sahil Nanda - 211128 Sanchit Aneja - 211130 Udit Anand - 211152 Vaibhav Jain - 211155

Situation Analysis

Management Organisation Chart


Name Richard Fiero Emma Richardson Becky Timmons Ed Pryor Harold Whistler Tony Barren Allen Roth Cory Wu Alice Gorga Designation President Executive VP CFO VP, Sales VP, Design and development Director, Production Director, Design and Development Manager, Software and Firmware Design Manager, Hardware Design

Situation Analysis
TerraCog has been a trusted brand specializing in quality hand held GPS products that have loyalty among sports enthusiasts

One of its competitors Posthaste , introduced a GPS prototype called BirdsI that is able to display satellite imagery
TerraCog did not see any threat until it started losing competitive edge and market share to Posthaste due the success of BirdsI

Situation Analysis Contd


TerraCog also plans to launch a GPS device with satellite imagery called Project Aerial to protect its market share Since product was to be launched without any delay, a redesign within existing GPS platform was proposed This resulted in increased production costs as well as degraded quality

Situation Analysis Contd


Sales team head Ed Pryor feels Aerial should not be priced more than $425 as company plans to recapture the lost market share Pricing team quotes a minimum price of $475 leading to conflict in decision making Responsibility of leading the group towards a decision lies with Emma Richardson , a newly promoted Executive Vice President of the firm

Problem Analysis
Short sightedness: TerraCog had started losing share to Posthaste, its rival in GPS devices

Inter group conflicts: Their project Aerial had serious issues regarding pricing of the product

Problem Analysis(Contd.)
Lack of Innovation: There was an inherent tradeoff between their value proposition and cost

Delayed market Responsiveness: They were already late to the market and were launching at a market premium

DECISION ANALYSIS

Decision 1
Launch Aerial with reduced margin(as suggested by Ed Pryor) at a price of $425

Gain consumer confidence and recapture lost market share Continue Redesigning and improve the manufacturing process of the product to reduce production cost

PROS and CONS


Pros: Immediate market presence (BirdsI and Garmin already there) Capture sales for holiday season
Cons: Decreased margin Pressure on manufacturing and design team to reduce product costs

Decision 2
Cancel product launch for now Recreate and redesign a new product with major reconfiguration i.e. focus on innovation Launch the new product in the market with a ROAR

PROS and CONS


Pros: Maintain supreme quality Surpass competitors
Cons: Declining market share High risk Missing holiday season sales

Decision 3
Cancel product launch completely Focus and capitalize on growth in untapped market

PROS and CONS


Pros: Early mover advantage Under served market: Great scope Cons: No share in Satellite Imagery GPS market Brand image of TerraCog at stake

Decision 4
Emma Richardson works one on one with Team Leaders to address underlying agendas

Arrive on a consensus for price and then launch the product

PROS and CONS


Pros: Better coordination Basis for consensus Aligns objectives and decisions Cons: May be too late to change the decision process There may be no solution to some problems Could be highly priced from customers perspective

PLAN OF ACTION
We would recommend decision one: Launch Aerial at a price of $425 and continue to redesign and innovate Companys differentiating factor is in the quality of its products and it should not compromise on the same

Why Option 1?
If decision 2 is chosen o Further loss of market share o Loss of holiday season sales If decision 3 is chosen o The project is cancelled o Terra Cog will completely lose the Satellite Imagery GPS Market o Affect companys image

If decision 4 is taken o Emma may not succeed at controlling all the domains of the company single handedly

PLAN OF ACTION contd.


Make a common consensus among all departments to launch Aerial at $425 Initiate an aggressive marketing campaign Form an R&D team to redesign the product and take the speed factor into account Regular meetings conducted by Emma, so that each department is updated on the project This would help company to maintain its image and recapture the market share

THANK YOU!