Assignment:
Forecasting New Products and Services
Forecasting provides very useful projections for established products and services, but newly introduced products and services have wildly different success results. Name and discuss at least one product and one service that exploded with exponential increase in demand shortly after their introduction. What about products and services (2 products) that have largely been ignored?
Managerial Challenge
Survey and opinion polling are another forecasting tool that may be helpful in making short-period forecast. The greatest value of survey and opinion polling techniques are that they help to uncover if consumer tastes are changing or if business executives begin to lose confidence in the economy to maximize their wealth. Assignment:
(1) Research your favorite consumer product (iPhone, Coca Cola, Sony PlayStation, Gucci, Lego, Frito Lay Cheetos, etc.) for changes in trend (trend analysis)
(2) Develop a survey-opinion poll to determine if there should be a new product introduced. The questions in your survey-opinion poll should be designed to capture if the current users of the product are unsatisfied or completely satisfied with the product. This information will help you determine as the manager if you will introduce a new product.
(a) The survey must be at least 15 questions.
(b) The survey must have a reference list at the end for each article you researched to gather data on your favorite product.
(c) You must include a statement for your final opinion - introduce a new product or not.
Production Economics
"Boeing's Secret" (to retrieve and view this article your NEC student identification number is needed, copy and paste the link into your web browser)
How a Boeing 787 Dreamliner is built? - https://youtu.be/VRfXyccWUP4
After reading the article "Boeing's Secret" and watching the video "How a Boeing 787 Dreamliner is Built," discuss if you believe Boeing is labor intensive, capital intensive, or both. Has Boeing established the "network effect" for their product?
Cost Analysis
When materials are stored in inventory for a period of time before being used in the production process, the accounting cost and economic cost differ if the market price of these materials have changed from the original purchase price. Accounting cost is equal to the actual acquisition cost and economic cost is equal to the current replacement cost. After reading the articles "U.S. Car Business in Major Shift" and "Car Making in America", which cost do you feel the U.S. Car industry (GM, Ford, etc.) is most affected by - accounting or economic cost?
Managerial Challenge
US Airways owns a piece of land near the Pittsburgh International Airport. The land originally cost US Airways $375,000. The airline is considering building a new training center on this land. US Airways determined that the proposal to build the new training center is acceptable if the original cost of the land is used in the analysis, but the proposal does not meet the airline's project acceptance criteria if the land cost is above $850,000. A developer recently offered US Airways $2.5 million for the land. Should US Airways build the training center at this location? (Chapter 8 pg. 302 Exercise 1)
Cost Theory
After reading the article "Adding Value in Nike's Production Line (https://rctom.hbs.org/submission/adding-value-in-nikes-production-line/)," research your favorite brand of shoes (Nike, Adidas, New Balance, etc.) and answer the following questions: Has the company experienced declining or increased cost attributed to computerization? Was variable cost increased or decreased? Were fixed cost increased or decreased.
Product Differentiation
Product differentiation is a strategy that relies on differences in products or processes affecting perceived customer value. For this discussion forum, define the product difference between two similar yet competitive brands (e.g. Coca-Cola and Pepsi, Kleenex and Puffs, Heinz Ketchup and Hunts Ketchup). Discuss what makes your product choice different to include product image, price premium, technology, and generic brands.
Regulated Monopoly
Research an organization or brand that you feel is a monopoly. Discuss the organization or brand giving your classmates a view details about why you feel it is a monopoly and determine if the monopoly is a regulated natural monopoly and why?
Managerial Challenge
After reading the section titled "Dominant Microprocessor Company Intel Adapts to Next Trend" (Chapter 11 pg. 384-385) and the article titled "2018-2019 Intel Corporate Responsibility Report: Creating Value through Transparency, (https://newsroom.intel.com/editorials/2018-19-intel-corporate-responsibility-report/#gs.gn9ttl)" complete a list of reasons how a single firm like Intel comes to dominate some markets.
Oligopolistic Industries
An oligopoly is characterized by a relatively small number of firms offering a similar product or service. Oligopoly products may be branded, as in soft drinks, cereals, and athletic shoes, or unbranded, as in crude oil, aluminum, and cement. The main distinction of oligopoly is that the number of firms is small enough that actions by any individual firm on price, output, product style, quality, introduction of new models, and terms of sale has an impact on the sales of other firms in the industry. Review the Table 12.1 (pg. 416, attached below), select a dominant single firm, duopoly firm, and triopoly firm and discuss if you foresee any weaknesses in the three firms you selected that would allow entrance into this market or if one of the firm has enough strength to become a monopoly?
Price Skimming
Price skimming strategy is a new product strategy that results in a high initial product price being reduced over time as demand at the higher price is satisfied. Research product or service that may have entered the market with a high initial price and now the demand at the higher price is satisfied. Discuss why you believe consumer demand has changed for this product or service which resulted in satisfaction of the market.
Antitrust Regulation
Antitrust regulation is designed to increase competition by eliminating attempts to monopolize an industry (other than through better products or better management) as well as by attacking certain patterns of illegal conduct (i.e. price fixing and exclusionary contracts that foreclose competitor business). For this forum, discuss your belief on "tech giants" violating antitrust laws. Do you feel Facebook, Google, Amazon, Apple, Microsoft etc. are in violation of such antitrust regulation?
Capital Expenditure Decisions
Mergers and acquisitions are capital budgeting techniques. This technique is a managerial expansion decision to increase assets drawing a cash benefit. Research a most recent merger or acquisition and discuss the firm (merger - stable firm / acquisition - purchasing firm) expected cash benefit. Pretend you are the owner; would you make the same decision? Why or Why Not?
Readings:
Managerial Economics Applications, Strategies and Tactics
By James R. McGuigan and R. Charles Moyer