Terracog

TerraCog GPS: Conflict & Communication on Project Aerial

TerraCog Global Positioning Systems

Weaknesses in the Decision making process

Decision To Proceed with Aerial made by the president Fiero based on pressure by the vice-president of sales Pryor.

Initial decision not to compete with Posthaste was on basis that it would be a short term trend.

Ariel being projected as a similar product to that of Posthaste though it is superior in quality.

Production costs is considerably higher than expected as present components are expensive.

CFO’s profit margin makes it impossible to match competitors price point.

TerraCog Global Positioning Systems

Decision To Be Made At End of Case

Launch Ariel at full price to maintain standard margin

and differentiate from the competition

Launch at competition price $425 at zero profit while working on redesign while working to reduce cost

Delay Ariel while working on lower costs re-design

causing further loss in market share.

Abandon Ariel

TerraCog Global Positioning Systems

Conflicting Individual Objectives

Pryor (Sales), concerned with the compensation of his team.

Barren (Dir. of Prod), Recent product failure for which he was held responsible for has made him conservative and hence will not take any form of risk.

Roth (Design and Development), team not excited about project—other projects more exciting—interested in being promoted to be VP of design and development.

TerraCog Global Positioning Systems

Wu (software designer)—at meeting defends design not understand why costs are so high since he only tweaked the firmware

Whistler (VP of design and development) no longer fully involved in the company. Retirement soon.

Richardson (Executive VP)-difficult position, recently promoted, middle of a problem. Needs to reach a solution internally as well as externally for the firm.

TerraCog Global Positioning Systems

Conflicting departmental Objectives

Design and development had little...