TERRACOG INC CASE ANALYSIS 1
TerraCog Inc. Case Analysis
TerraCog Inc. was a privately owned company that specialized in production of high quality GPS and sonar equipment used for fishing. The Company was founded in 1977, and immediately began manufacturing high quality sonar equipment for boaters and sport fishermen.
The company, in the late 990s, had started the introduction of GPS products specifically for hikers, hunters, and campers. TerraCog Inc. is at the verge of launching a “Project Aerial” the following day later Emma Richardson had squinted some of the TerraCog GPS prototype in her hand. One fact is that TerraCog Inc. had started to lose its share to
Posthaste, a competitor, and it was important that they get this new product saturated in the market. After the launch of Bird by the Posthaste, another fact of the matter is that TerraCog, at the spring of 2007, noticed a rapid increase with the customer demand of the GPS (Beer & Yong, 2008). To develop a GPS is expensive. The company, for example TerraCog Inc., would be forced to find ways of ensuring efficiency while maintain costs.
There are key issues that surround TerraCog and the launch of their GPS. First, the main issue is competition. The company faces huge completion from other companies, for example Posthaste Company. Posthaste Company for instance, recorded impressive sales of its GPS product with a satellite image. Another issue was the high production costs of the GPS.
The “Aerial Project” was not to cost more in production (Beer & Yong, 2008). The mail from Allen notified Emma of the need to cut the costs by 7% or 8% before the GPS was launched. Again, there was an issue with the production team.
The company was running late with its production as noted by an email to Emma, prompting him of the need to ensure Aerial project as on the shelves at the start of Q3 (Beer & Yong, 2008).
Another issue was the need to hit new targets in the market. As understood, sales president, Ed Pryor, reiterated on the issue to develop a quality product that would compete favorable in the market. He noted that customers demanded for something different and of a higher quality. The issue the vice president had been to ensure those demands was met. The team was then forced to redesign from satellite imagery to “Project Aerial”.
Redesigning the project brought other issues. First, there was a disagreement to change to Aerial. They felt that they could stick to original design but could create time for improvement, which included improvement of external case, TFT, and internal components (Beer & Yong, 2008). Another issue was that since they had a number of ideas for the new products, which they believed could reposition the company to take advantage of the growth in fitness and recycling the GPS application, they felt that redesigning to “Project Aerial” could ruin all these projects in the pipeline.
All the issues discussed above have alternative course of action. TerraCog Inc. would easily deal with competition by improvement of its GPS application to meet market demands. This could easily be done when the company opted for redesigning of the original project to ensure that the company does not incur a lot of costs at the expense of market competition. This is evident when at the pre-launch meeting when Barren notifies Richardson of the cost of building the GPS (Beer & Yong, 2008).
Alternative to this is to improve the original satellite imagery in order to keep up with the competition. Again, an alternative to the issue of costs of production is, instead of total overall of the prototype, the designing team should just improve slightly on the original design. And alternative to satellite imagery redesign is to push for improvement of “Project Aerial”, but with minimal adjustments to ensure costs of production are met.
Another alternative to the company’s need to reposition itself in taking advantage of the GPS application, should be through redesigning the “Project Aerial” by putting down the costs of production of a new GPS and comparing it with the original satellite imagery.
With competition the main focus to redesigning the original application, it should be noted that the company aims at being at the forefront in ensuring that the customers are satisfied. TerraCog Inc. should then aim at coming up with a product that is approximated to be customer friendly and is retailed at a premium, which is at per with the current line of GPS and is in a better position to maintain the same high-end functionality in the market.
The cost of production is a serious issue when it comes to ensuring the company is in a better position to sustain itself and at the same time, meet the customer’s needs. While a company, for example, TerraCog, aims at sustaining itself, it should perform some careful planning to keep costs of production as low as possible (Beer & Yong, 2008). The company should then hand off the production costs to develop detailed costs estimates of the application. Again, changes to the original design should also be done after the company has done proper evaluation to the company sustenance and the market demands.
In conclusion, recommendation of the best course of action to take should be handled carefully by the company involved. The best course of action for TerraCog Inc. is to go ahead with launching a new design to the “Project Aerial”. This would not only give an edge to the company over its competitors like Posthaste Company, but also would be in a better position to satisfy customers’ needs. With redesigning of the GPS would be costly for the company, but as much as failure to compete favorably in the market. In order to reduce the cost of production, the company should use quality but affordable materials.
Beer, M., & Yong, S. (2008). TerraCog global positioningsystems: Conflict and communication on Project Aerial. Cambridge,MA: Harvard Business School Pub.