Essay

Chapter 15 Product Development and Supply Chain Management

CHAPTER OUTLINE Spotlight: Lighting the Way to Product Development (http://www.dinealight.com and http://www.readycheckglo.com) 1 To Grow or Not to Grow Understand the challenges associated with the growth of a small business.  Entrepreneurs prefer differing growth rates  Successful growth affected by financing sales volume which then affects inventory requirements  Places enormous demands on small firm’s personnel and the management style of its owners 2 Innovation: A Path to Growth Explain the role of innovation in a company’s growth.  Competitive Advantage and Innovation Discuss how a small business can sustain its competitive advantage (example, patents, contract, “fly below the radar screen” of competitors)  Creating and perfecting new products or services can be difficult  “rules of thumb” that may help reduce the risk of failure  Base innovative efforts on your experience  Focus on products or services that have been largely overlooked  Be sure there is a market for the product or service you are hoping to create  Pursue innovation that customers will perceive as adding value to their lives  Focus on new ideas that will lead to more than one product or service  Raise sufficient capital to launch the new product or service  Sustainability and Innovation Discuss what a sustainable competitive advantage is and how it affects the business.  Sustainable competitive advantage (see Exhibit 15-1 showing the three stages of competitive advantage life cycle) A value-creating position that is likely to endure over time.  Must produce a continuous stream competitive advantages to keep performance from falling off 3 The Product Life Cycle and New Product Development Identify stages in the product life cycle and the new product development process.  The Product Life Cycle  Important to small business owner for three reasons  Helps entrepreneur to understand that promotion, pricing, and...