Asked Jun 14, 2019

What are the key decision rules for managers facing flat or declining markets?


Expert Answer

Step 1

1. Transformational Innovation:

In case of the declining market, organizations are required to introduce an innovative feature in their product so that the available customers are attracted towards the offerings of the organization and thus the market for that product can be uplifted. Organizations are required to define new categories of the products or sub category of the currently available product. With the increasing competition in the market, the need and the attraction of a product within the group of customers, after a certain period of time, starts declining and hence it becomes very necessary for the organization to implement the incremental innovative changes within their products so as to retain the customers and survive within the fierce market competition.

Step 2
  1. Along with the tactical approach, managers should also focus on the strategic decisions towards the various parameters associated with the market. Managers should focus on three key drivers of strategy. First is the customer insight. A customer insight is an interpretation of trends in human behavior so as to increase effectiveness of a product or service for the consumer, as well as increase sales of the organization for mutual benefit. Customer insight helps in the strategic allocation of the resources so as to reduce the cost of the product and hence establish the competitive edge within the market. Second is the value preposition which is nothing but the adding up of the innovative feature within the product or the services so as to impart value to the product and the services. And the third being the brand strategy. Brand strategyis a long-term plan for the development of a successful brand of the product and the organizationin order to achieve specific goals. A well-defined brand strategy affects all aspects of an operation of the business and is directly connected to consumer needs, and helps the organization to survive in the competitive environment.
Step 3

3. A manager first, should control the development of the product over a period of time, secondly, should understand the rules, regulations and the laws of the various countries and the territories in which the organization is conducting its business and finally, the functional verticals. This approach of the manager will...

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