TerraCog GPS - Project Aerial

PGMAX (2014-2015)

Anupam Ghosh (Roll no. 6)

What You Say?

• You all must have Conflict, didn’t you?

• Is it always Negative or Positive also?

• Reasons for Conflict?

• Can it be managed?

TerraCog

• Founded in 1977, manufactured high quality GPS and fishing

Sonar equipment.

• Not the first to market new products.

• Have good market presence and Brand value.

• Products were of high quality and effectively addressed

customer needs.

Birth of Project ‘Aerial’

• Posthaste, introduced a GPS product called ‘BirdsI’ that displays satellite

imagery in Q4, 2007 at retail price of $400.

• TerraCog did not see any threat and underestimate BirdsI, which proved to be

wrong.

• By the time TerraCog realized their mistake in judging BirdsI, the product

was a huge success.

• In order not to lose the market, TerraCog also plans to launch a GPS with

satellite imagery dubbed Project-Aerial.

• As the product was to be launched without any delay, a redesign within

existing GPS platform was proposed.

• Gramin is also about launch GPS at $395.

The People

Richard Fiero

(President)

Emma Richardson(Exec VP)

Tony Barren(Director,

Production)

Becky Timmons(CFO)

Ed Pryor(VP, Sales)

Regional Sales Manager

Harold Whistler(VP, D & D)

Allen Roth(Director, D&D)

Cory Wu(Manager, S/W

Design)

Alice Gorga(Manager, H/W

Design)

The ‘Aerial’ Route

• Aerial project was launched in Q2, 2007 with the plan to launch the

Aerial on Q3, 2008.

• Initially it was decided to launch new product without Satellite

imagery, which was reversed.

• Planned to compromise on speed as they expect the consumer to

inherent trade-off to get more sophisticated graphics.

• To cut down on cost, TerraCog decided to tweak the same set of

hardware and components that was used in previous product.

• Aerial will have a premium of $50 than existing GPS.

Conflicts in ‘Aerial’ route

• Sales team headed by Ed Pryor feels the new product Aerial should be priced below $425 to

capture the lost market share to the competitors. They are also concerned about slow speed

of Aerial.

• As per the production team headed by Barren and Design team headed by Roth, price for

sale would, at the minimum, be $475.

• While CFO, Timmons was not ready for price below $500 because of economic conditions

outside.

• Cory Wu, Manager S/W design was not convinced with the price of $475 as the changes

were not enormous as per his team.

• The key unit managers gather in a pair of contentious meetings that feature anger, finger

pointing, blame and bewilderment, but produce no effective conclusion.

• The responsibility of pushing the group towards a decision lies with Emma Richardson, a

newly promoted Executive Vice President of the Company.

Potholes in ‘Aerial’ route

• No clear Agenda

• Lack of communication among executives

• Inter group conflicts

• Task Conflicts

• Delayed market responsiveness

• Short-sightedness

• Lack of proper research

• Lack of innovation

• Lack of motivation

• Lack of enthusiasm

• Lack of common vision

• Preference of individual goals over organizational goals.

• Lacking true leadership

Biggest Potholes in ‘Aerial’ route

•Hurry to enter the market after a significant lag.

•Lack of Clarity on price and positioning

•Inter group conflict

•Individual goals over organizational goals

•Short sightedness and lack of common vision/Goal

Conflict Based Individual Goals

• Pryor (Sales), concerned with compensation change and not

want to disappoint sales team.

• Barren (Production), Recent production problem which he was

held responsible for. Job insecurity and maybe resentment for

being blamed may lead to him being very conservative.

• Roth (Design) team not excited about project—other projects

more exciting—interested in being promoted to be VP of

design and development.

• Wu (software designer)—at meeting defends design not

understand why costs are so high since he only tweaked the

firmware

• Whistler (VP of D&D) no longer fully involved in the

company. Retirement soon.

• Richardson (Executive VP)-difficult position, recently

promoted. Needs to reach a solution but not hurt her

relationship with other managers.

How should Emma do?

• She was showing Ineffective Conflict Management Technique –

Noaction.

• She should implement Effective Conflict Management Technique –

Superordinate Goals.

• For the Aerial project, Emma should adopt Collaborating Conflict

Management.

• Emma Richardson should start working one on one with Team Leaders

to address underlying agendas.

• She should start acting as a mediator and a common link for

communication between various departments.

What should Emma do?

• Launch Aerial at full price to maintain standard

margin

• Launch at competition price $425 at zero profit while

working on redesign to reduce cost

• Delay Aerial while working on lower costs re-design

• Abandon Project - 'Aerial'

Thank You…!