Important aspects of organizational decision-making include risk assessment and the development of solutions and results evaluations. TeraTech is an organization created by the University of Phoenix, which allows students to learn about how to use the information from a case study approach to apply the information they are learning. The following is the third part decision-making process for TeraTech, and includes identifying and assessing risks, making the decision, developing and implementing the solution, evaluating the results, and a conclusion from Parts 1, 2, and 3. This may occasionally refer to Tables and Appendix sections that are not available in this version.
Identify and Assess Risks
Risks are part of all business decisions, creating the right mix of risks and opportunities along with a clear risk mitigation plan allows a company to move forward with strategies that increase the profitability of the company. TeraTech is currently at risk for declining sales, the greatest risk would be to do nothing. The second greatest risk would be investing in a product or solution, which could not present clear future sales. At this time, customer service scales demonstrate that current clients may not be willing to purchase a new solution if there is reason to believe that the support they currently receive will be the same with the new product. Support for the product would be essential to the success of the product. Development of customer service channels that fulfill the needs of clients is a requirement for any option; however, alone it only solves one part of the problem. Development of current products to fill needs in other markets solves the problems of market entrance, product offering, and builds target markets. Additionally, the changes in the product can increase customer satisfaction by increasing user friendliness of the products.
One risk associated with upgrading the products and using them in new markets is the products are unable to be revamped for use in other markets. This plan would be useless if the products cannot be retooled; however, it is very unlikely that the markets interested in exploring CRM products would not find a use for these products. Innovation is key to this project and success will increase both product offering and target markets for TeraTech. Mitigation of the risks will include the review of markets for potential markets that use the same types of information or format of information – though from other sources. The project team will maintain a careful eye on costs involved with needed upgrades and develop a budgeted marketing plan for market entrance for the revamped products. Additionally, the project team will maintain communications that share the research results with the developers in order to tailoring development and marketing to actual ability of the programs and product.
Choosing the right source for collaboration on customer service options is essential for the success of the project. The company chosen should be able to consistently work closely with TeraTech, develop seamless interactions with consumers, and evaluate customer needs to provide the right amount of information sharing. Risk mitigation for this option includes researching companies before agreeing to partner – a complete company report would be required for the best options, developing a solid contract that relates the needs and expectations of the company including the requirement for successful communications internally, and weighing risk and cost to make the best selection for the partner/outsource company.
Developing a new product includes the normal risk factors and also includes industry risks for CRM. Current competition is working on a new product that may have more value to consumers. Additionally with customer satisfaction being low, customers may not trust TeraTech’s new product to provide enough value to make the investment. Finally, without knowing what products the competition is working on, the final product risks obsolete status at production. Mitigation of this risk includes careful environmental scanning, implementing the new product with a customer service solution, and reviewing the current market offerings for possible forecasting on technologies and growth in the market.
Make the Decision
TeraTech would see industry growth by developing a strategy that begins with customer service and product implementation for other industries. Retooling current products is less costly, enables the company to open up to new target markets, and develop solutions that increase the overall value of the company. In October 2007, ACNielsen reported that 78% of consumers were more likely to buy a product or service based on the recommendation of another consumer (Trust in advertising, 2007). New products are not always accepted even when the clients are businesses, unless other companies have used the product and recommend those solutions. For instance, Microsoft has spent years building a reputation with companies as an office solution with the Microsoft Suite applications. This trust has grown by company recommendation and word of mouth even more so than direct advertising. A successful product can be a retooled product, which fits the need of a new industry.
Developing successful relationships with customers is one example of how a company continues to grow by retaining customers. At this time, the customer relationship suffers from lack of support and quality interactions. To develop these interactions TeraTech must develop stronger customer support teams or look towards working with another company – outsource or collaborate – to create solutions that enable customers to get answers quickly and effectively. While other options such as intranets and portals also exist for implementing quality customer support, current needs and costs suggest that those options become part of a long-term goal while the development of a source for seamless interactions become an immediate focus for TeraTech.
Develop and Implement the Solution
Implementing the solution will require additional research and development of the options that best lead TeraTech into the future. Research includes information on customer service solutions and companies, industries most interested in CRM solutions outside of pharmaceutical industry, information needed for sales in other industries, and developing talent for innovation with current products. Evaluation of the market is essential to the strategies success; however, developing the project in a timely fashion is required to give TeraTech a boost in sales in order to start funding new products to fill industry needs. A project team built from members from the management staff and key product developers will develop the research and implementation. Additionally, members of the marketing team will need to begin careful industry marketing, penetration strategies, and review current offerings of other companies outside the pharmaceutical industry. A communication hub should be created to increase the information between the marketing team and the project team in order to maintain proper timelines for the project’s completion.
Research for the markets where CRM products may be retooled should be developed within a three to six month timeline. This research should review which markets are most interested in these types of products and working closely with the product development team to determine the viability of the products for the different industry needs. Innovative product retooling should begin as soon as the first potential market is discovered and marketing strategies should begin by seeking out a potential starter company to evaluate the success of the product. Additionally, at least three new markets should be identified for possible penetration strategies. This project should be complete, with product testing, before the end of the first year.
Discovering a partner for customer service solutions requires research on current companies offering quality customer service. At least three options should be available with reports on standards and ratings amongst the industry within one month. Contracts may take a few months to develop and successfully complete. The primary goal is to implement the customer service solution within 6-9 months to begin to see improvements on customer service ratings. This will also enable TeraTech to move talent into roles of support for the development teams and sales teams, or reduce staff to decrease costs. During the development of successful negotiations for developing customer service support, the marketing team will develop corporate advertising that will become a part of the representative’s interactions with consumers and synchronize this communication with marketing strategies in place or being developed. “Consistent spending on corporate advertising can serve to boost a corporation’s equity, much in the same fashion that product-orientated advertising is in investment in the brand equity bank.” (Shimp, 2007, p. 287).
Evaluate the Results
A chart will be created to evaluate the success of the project during and throughout progress, implementation, and conclusion. During the process, every step will be carefully evaluated for needed changes, from budget through timelines, to ensure the success rate of each segment of the plan. To start, the management team will determine who should be part of the project team. If necessary, two project teams can be developed to implement the plans. The goal is increased sales and customer satisfaction ratings before the end of the year. With the implementation of upgrades and customer service solutions, the decline in sales should decrease by at least 2% before the implementation of the new market’s strategy; however, the goal is to increase sales productively enough to develop a new product within one year’s time. At the longest, market penetration for the current products retooled should take no longer than two years, during the last year development of a new product should be in plans.
Pilot testing will be essential to the success of the products to be introduced to new markets. The marketing and sales teams will need to find companies that are willing to test out the new products. TeraTech has recently focused heavily on a product and production orientation that focuses on development of the products new or improved, as the primary focus of the company. This orientation is a source of great undertaking that should not be ignored; however, with recent changes to the markets and competition, it is imperative that a marketing concept orientation be adapted to work with this company goal. The Marketing concept “holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do.” (Armstrong & Kotler, 2007, p. 11).
ACNielsen, a market research company, shed light on the new trend of “green” and showed that not all consumers are eager to give up everything to go green (Packaging and the Environment, 2008). These facts took marketers and product developers by surprise, isn’t labeling it “green” enough? Addressing the needs of the environment is great for company public relations, but lack of communication or developing products that do not support consumer needs will still put the product back on the drawing board. Understanding what consumers are willing to trade to go green enables a company to answer the four P’s of market research and develop products that fit into the trend, successfully fulfilling consumer demands. TeraTech must also find the way to build consumer satisfaction and promote advertising that reaches the market successfully, and in a way where the information is most trusted. To accomplish industry leadership TeraTech should put a focus on successful customer interactions, creating value in growing markets, and developing strategies that enable continued growth through product design, redesign, and implementation.
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