In the context of gap analysis, under what circumstances

In the context of gap analysis, under what circumstances would the use of the Determinant approach be favoured over the AR or OS approach?

The role of a gap analysis is to make a comparison of performances, ideally looking at what is there currently versus where the firm desires to be at a given period. To achieve this, businesses use either the determinant, the AR, or the OS methods. The determinant approach is favored over the AR and OS approaches in a number of scenarios. First, the determinant method uses the managerial expertise and experience to arrive at a judgment. The AR and OS approaches involve customer attributes and perceptions respectively. Based on this, the use of customer attributes or perceptions require time and resources, therefore making the decision making process a little bit slower. The determinant approach comes in handy to cove this gap. By using managerial insight, the decision making steps are significantly reduced in a way that saves the company some time and money. In a case where an urgent decision is required, or when there are no resources for customer insights, the determinant approach would be preferred.

In the context of gap analysis, under what circumstances would the use of the Determinant approach be favoured over the AR or OS approach?

Gap analysis enables firms to compare current performance with their expectations. The determinant gap analysis approach is based on the expertise of the management and their judgment of a situation or process. The AR approach is founded on customer attribute ratings while the OF strategy is based on consumer perceptions of overall similarities. The determinant approach is used when there is a need for a speedy analysis and one that adheres to a cost efficient approach, in line with other organizational objectives and analysis. Therefore, the determinant approach is important and usable only when internal input and managerial expertise are required in the decision making process. It is best chosen for its speedy nature and the ability to reduce costs. Additionally, it involves market expertise that managers have gathered throughout their years in management. Other approaches require a lot of time and input from customers, a process that would take up a lot of time and resources.

Explain the following terms using your own words and illustrate with an example for each that is based around one or more of the firms listed in the project choice:

•    Product line extensions

Product line extensions are new services or products that differ slightly from what a company or business offers. For example, when a beer company produces a new beer to cater for a new market.

•    Product improvements

Product improvement denotes a process of ensuring more meaningful changes to a product with the intention of gaining new consumers or increasing benefits to the existing line of customers. For example, a phone company can add a new feature such as a bigger loudspeaker to improve an aspect of their product

•    Cost reductions

Cost reduction looks at the processes that identify and implement means that permanently reduce the unit cost of services rendered or manufactured goods to increase profits. For example, a company can decide to outsource labor in order to reduce costs and gain more profits.

•    New categories

New categories are new products or new markets that are relevant to a business in terms of goals and objectives. For example, if a company creates a new product to attract a new market segment such as women athletes for a shoe company.

Innovation may be the single most important key to a firm’s survival. Why is this so?

One of the most important roles of innovation is that it helps industries and organization to remain relevant in a market that is changing a lot and becoming more competitive by the day. Innovation is important because of how it creates an ability for a firm to resolve critical issues, create new products and markets, and appeal to newer consumers every day. By introducing something new, innovation introduces new processes, technologies, managerial strategies, policies, products, and other important elements of an organization. The changes that innovation brings are key to a firm’s survival because they enable better capacity to compete or respond to issues pertinent to an industry or organization. For example, in the present global business environment, firms have had to innovate in order to respond to the COVID-19 pandemic and the issues therein. Innovation enhances the ability of a firm to react to market changes and to adapt to the changing environment.

Consider the New Product Development process represented here: opportunity identification & selection -> concept generation -> concept/project evaluation -> development -> launch. Which Phase is the most important? Justify your answer.

In the new product development process, the most important phase is the opportunity identification & selection. It is the most significant because it involves the generation of ideas, the creative task of seeing problems, and using innovative means to create a solution. Generating ideas must involve a specific way of thinking and of looking at issues in a given society. For example, in a society with 90% middle-class working people, some of the main problems include low disposable income. In such a community, innovative products must consider price of commodities and the ability of people to afford it. Therefore, the new or improved product or service must consider such issues in order to create an innovative product/service or process of marketing. If this process is not done right, then all other processes are likely to fail. Therefore, the identification of an opportunity and selection must be the most important aspect of product development.