2012: 1/2/2012, Beginning Time Warp 3. You

¶ … 2012: 1/2/2012, beginning Time Warp 3. You completed analysis revised strategy years a breather. Just time, enter predetermined decisions year collect data future analysis.

The time wrap experience comes to an end and makes way to resume the normal activities. Still, before doing so, it is necessary to review the decisions made in each of the two scenarios, and draw the adjacent lessons. The table below was created to offer a more integrated look at the two scenarios, with the two sets of decisions and the two sets of results. The lines following the table explain the differences and use the CPV analysis to shed more light.

Scenario

Scenario

Decisions

Decisions

Decrease in R&D allocations from 33% to 20%, coupled with price stagnation

Stagnation of the market; the product enters the decline phase

X5 -- R&D costs capped at 20 per cent and prices slightly decreased to attract more customers

Loss of profitability, discontinuation in the near future

X6 -- Slight decrease in R&D from 34% allocation to 30% allocation. Retail price preserved at pre-existent levels

The product enters the maturity stage and becomes consolidated within the market

X6 -- increase in research and development allocations and increase in product price

Reached growth stage, discontinuation proposed for the medium term future

X7 -- Increase in research and development allocations from 33% to 50%. The price of the tablet is initially preserved, and then increased to cover the additional R$D expenses.

Increased capabilities of the X7 tablet, increased consumer trust

X7 -- increase in R&D allocations and a decrease in retail price

11 per cent profitability

Growth stage of the product, sustained investments in the X7 tablet

The decisions made in the two time wraps reveal some similarities, but also several differences. The similarities for instance are given by the identification of the product stages. In the case of the X5 tablet for instance, in both scenarios, R&D allocations were decreased. Yet, the price decisions differed and so did the results. The lines below integrate the principles of the CPV analysis and present a more detailed discussion of the decisions in the two time wraps, with the results which were retrieved (Blocher, 2005). In this order of ideas:

Both situations recognized the decreasing value of the X5 tablet and decided to decrease its R&D allocations. Still, in the first scenario, the decisions revolved around the preservation of the initial price, whereas in the second scenario, it was decided to decrease the price. The second strategy was more feasible as the consumers for the X5 are more price-sensitive and as the entering of the decline stage was more gradual. In the first scenario, when the price was maintained, the product more rapidly decreased in popularity. In both instances, the future would bring about the unavoidable discontinuation of the X5 tablet, but with the second set of decisions, the discontinuation would follow a stable and natural path, whereas in the first scenario, it would be more dramatic.

In the case of the X6 tablet, the first set of decisions revolved around the slight decrease in the research and development allocations from 34 per cent to 30 per cent. The rationale for this decision was represented by the desire to invest more in the X7 tablet; still, the X6 tablet was highly popular among customers and it should not have been allocated less funds. The second scenario is as such more suitable, when the R&D allocations for the X7 tablet were increased. This increase was not however created at the expense of the X7 tablet, but was followed by an increase in the tablet's retail price. The results in both cases revolved around the growth and eventual stagnation of the X6 market, yet the rates of growth were higher in the case of the second set of decisions. In both cases, the X6 tablet is estimated to be discontinued in the future, as both items X5 and X6 exit the market and are replaced by the X7 table.

Finally, in the case of the X7, the two scenarios had a common ground in the increase of the research and development allocations. This increase was justified by the high potential of the X78 tablet, combined however with the need to further develop it. While in the case of the first scenario, the price decision was that of price preservation, followed by an increase in the price, in the second scenario, the decision revolved around the reduction of the price in order to draw more customers towards the product. The results were more positive in the second scenario.