Organizational Behavior -- Charles Schwab

Organizational Behavior -- Charles Schwab

How product design is applied in decision-making of that organization?

Charles Schwab focuses primarily on the needs of individual and small business investors over the lifecycles of their investment careers, selectively adding in new products and services to meet unique needs over time (Prasso, 2011). The new product development and design process is also aligned to major shifts senior management sees in the market. This factor driving product design at Schwab has most recently centered on as Do It Yourself (DIY) approach to defining 401K contributions and other investment options (Palmer, 2010). Product design then is defined by stage of the customer life cycle for the majority of new products and services, designed to approximate the level of risk and return consumers in each class of investor consider acceptable (Prasso, 2011).

Can you describe a Product Life Cycles in the organization?

The product lifecycles at Charles Schwab for the majority of financial services are a decade or longer in scope (Fletcher-MacDonald, 1998). As the 401K programs, Keogh and individualized money management programs can vary significantly in definition, all share a common attribute of lasting a decade or more if they are successful. It is common for Schwab to consolidate a series of less successful products and services into an entirely new offering, with the intention of gaining greater profitability and market acceptance with the revised packaging and pricing (Fletcher-MacDonald, 1998). Schwab also has extensive financial services research and industry research teams that are responsible for defining new products and also suggesting changes to existing ones. These teams are often managed by a vice president or senior director of product management, who has at least a decade of expertise in financial services. These VPs and directors are different than mutual fund managers, as the latter are more focused on how to create more effective funds to manage. The lifecycles of a successful mutual find, 401K or Keogh plan is often indefinite.

How different Issues for Product Development are applied in the organization?