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Back Bay Battery Strategy Essay

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1. What was your strategy going into the simulation? Market data analysis stressed two main facts: i) the promising potential of ultracapacitors and ii) surfacing mature market conditions for conventional NiMH batteries. The first piece of information implied that it would be critical to beat the competition and be the first company to offer customers the features and benefits they demanded in the new product. That would have allowed Back Bay to gain a competitive advantage and keep existing customers (that could easily switch from the company’s conventional batteries to the company’s ultracapacitors) as well as attract new ones. The second piece of information implied that demand for my core business products would soon start to decline…show more content…
Only later in the second year did I learn that self-discharge was also a very important feature (specifically to the Power Packs market). 2. Did that strategy work for you? Why or why not? My strategy seemed to work well for the first two years but then it became evident that I was losing market share in the NiMH business. I decided to cut down R&D in that division too early and that caused me to miss my sales targets. As I lost market share in my core business, the volume effect from my decision to lower NiMH prices did not compensate enough to allow that division to remain profitable. Suddenly, I had a very tight R&D budget to work with (as it was based on sales projections) and limited cash could be allocated to the improvement of the ultracapacitors business. I also reacted too late to the shift in customers’ demand for Power Packs products from Power Tools products, which caused late and lower-than-needed investments in other products’ features such as self-discharge (high priority for both NiMH and ultracapacitors). 3. After having run through the simulation, what elements of that strategy would you have changed and/or what strategy do you intend to pursue in the group simulation? I believe that the fundamentals and criteria of my strategic approach were pointing in the right direction. I assumed that the high growth potential market was for
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