1.) If you were Bill, where would you begin? What steps should he follow to be s
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1.) If you were Bill, where would you begin? What steps should he follow to be sure that he had not missed any of the key points?
2.) What are the specific changes that need to occur at Time Flies to get the new product development process in general, and this product in particular, back on track?
3.) Could the target costing process be helpful here? Explain why or why not, providing specific reasons.
Case Reorganizing for New Product Development and Ongoing Customer Management Bill Johnson shook his head and sighed. His director, Lydia Jones, had just sent him an e-mail telling him that his engineering staff and marketing were at each others' throats over the new personal digital organizer that the company, Time Flies, was developing Bill: The fighting among your staff and marketing has got to stop; this is getting embarrassing. At the directors' meeting today, Steve (the marketing director) claimed that your staff is both behind schedule and over cost. He also said that he got wind at a trade show that a competitor is develop- ing a product very close to ours, and that they may beat us to market at the pace things are moving. Apparently he feels that your staff spends more time explaining why things can't work than they do finding solutions. Worse, the solutions they do suggest are obscure, expensive, and based on untested technology. We're starting to look like villains and developing a real image problem throughout the rest of the company. I am going to be meeting with the business unit president in a few days. I'd like you to brief me about your perception of the situation and what you recom- mend to improve the working relationships and the output. I've set up a time on your calendar on Thursday at 1:00 P.M. Thanks, Lydia remembered reading a similar story about IBM: how it had lost its way in the PC business because it rewarded its design engineers based on how many design awards they won rather than how well their products were received by customers. It had gotten to the point where IBM's development cycle was several times longer than its product life cycle. Bill could see elements of all of this at Time Flies. Various functions did not speak to each other. They had different goals. Finance translated the total product viability into EVA measures, but no one seemed to be held accountable for achieving them, or at least it wasn't clear how. Marketing wanted a new product packed with features, low cost, reliable, and ready to hit a mass market today. The engineers wanted to design quality products using innovative technologies, where they felt they could make their mark. Bill sighed. The next couple of days were going to be long ones. Yet Bill knew this problem had been going on for some time. Decreasing product life cycles were making the problem more seri- ous and more visible. Bill knew that some organiza- tional changes were needed and hoped he could be part of the solution. This gave Bill 2 days to come up with some answers. He remembered reading the story about Chrysler in the early 1990s, and how it had cut new product develop- ment times and costs tremendously while achieving higher levels of customer satisfaction by co-locating all the team members and making them jointly responsi- ble for all key elements of new product success. He CASE QUESTIONS 1. If you were Bill, where would you begin? What steps should he follow to be sure that he has not missed any of the key points? 2. What are the specific changes that need to occur at Time Flies to get the new product development process in general, and this product in particular, back on track? 3. Could the target costing process be helpful here? Explain why or why not, providing specific reasons.Explanation / Answer
1. If I were Bill, I would hold a meeting between product development managers, finance managers and marketing managers and encourage them to put forth their opinion regarding the ongoing issues of product development and reach towards mutual consensus while optimising the cost involved in product development and time required of the product development life cycle. It is very significant that all managers work in harmony for the common goal of organisation
2. The specific changes that need to occur at Time Flies to get the new product development process back on track are finding a realistic solution and using tested Technology while development of the product is very important in order to cut down the time required for product development and testing. Ensure sturdy quality check procedure so that there are less customer complaints regarding the product. This would help in reducing the overall cost associated with product development life cycle. And also work needs to be done on building strong relationships among managers and encourage on teamwork rather than individual performance.
3. Yes, target costing process would be helpful which would help in Planning and projecting the cost of a product before the development phase and would ensure that the product with low margin is not introduced in the market. It could also help in managing the design requirements and production techniques that revolves around the customer requirement.
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