Terracog Global Positioning System: Conflict and Communication on Project Aerial
TerraCog Global Positioning System: Conflict and Communication on project Aerial - Mayank Shah
Background and Critical Issues: TerraCog is a privately held company specializing in high-quality Global Positioning Systems (GPS) and fishing sonar equipment. The company has a strong customer base of serious outdoor enthusiasts who value the durability and value-added features of TerraCog’s GPS units. In spring 2007, the company embarked on a project to enhance their high-quality GPS handheld with satellite imagery; the project was named Project Aerial. The decision to develop the new enhancement resulted from increased customer demand, and lost market share to competitor Posthaste, who in October 2006, introduced BirdsI, the “only handheld GPS with satellite imagery”. By the end of 2007, TerraCog had developed a prototype of their version of a GPS unit with satellite imagery and planned to launch the product by the 2008 holiday season. Emma Richardson, the new Executive Vice President, was tasked with the launch of the newly developed GPS unit - she needed to finalize decisions on costs, pricing, and initial production volume. Emma’s main focus as the new EVP was to move the company toward greater operational alignment and increase cross-departmental cooperation. This focus was in response to existing tension between the U.S headquarters in Chicago and the production team in China. The development of the new Aerial would no doubt add to this tension. The design specifications of the Aerial GPS were handed off to the prod uction team; but sales and finance were running into problems with pricing due to increased production and design costs. Emma tasked Allen Roth, the Director of design & development, and Tony Barren, Director of production, with reducing the costs so that sales could meet their price point. They were successful in only reducing costs by 8%, but this was not acceptable to sales. With the current costs, sales would have
Background and Critical Issues: TerraCog is a privately held company specializing in high-quality Global Positioning Systems (GPS) and fishing sonar equipment. The company has a strong customer base of serious outdoor enthusiasts who value the durability and value-added features of TerraCog’s GPS units. In spring 2007, the company embarked on a project to enhance their high-quality GPS handheld with satellite imagery; the project was named Project Aerial. The decision to develop the new enhancement resulted from increased customer demand, and lost market share to competitor Posthaste, who in October 2006, introduced BirdsI, the “only handheld GPS with satellite imagery”. By the end of 2007, TerraCog had developed a prototype of their version of a GPS unit with satellite imagery and planned to launch the product by the 2008 holiday season. Emma Richardson, the new Executive Vice President, was tasked with the launch of the newly developed GPS unit - she needed to finalize decisions on costs, pricing, and initial production volume. Emma’s main focus as the new EVP was to move the company toward greater operational alignment and increase cross-departmental cooperation. This focus was in response to existing tension between the U.S headquarters in Chicago and the production team in China. The development of the new Aerial would no doubt add to this tension. The design specifications of the Aerial GPS were handed off to the prod uction team; but sales and finance were running into problems with pricing due to increased production and design costs. Emma tasked Allen Roth, the Director of design & development, and Tony Barren, Director of production, with reducing the costs so that sales could meet their price point. They were successful in only reducing costs by 8%, but this was not acceptable to sales. With the current costs, sales would have