Terracog Case

Topics: Marketing, Vice president, Price Pages: 4 (950 words) Published: July 21, 2012
This report deals with the problems in organizational communication and group conflictmanagement at TerraCog, a high tech company that develops GPS products for the consumer market. CASE DETAILS
Terracog was a successful privately held firm specializing in high quality Global Positioningsystem and similar products. Even though TerraCog was always not the first to market new products, thecompany did not have any problem in capturing the market as the products were of high quality andeffectively addressed customer needs. When a competitor µPosthaste¶ introduced a GPS prototype called³Birds´ that displays satellite imagery, TerraCog did not see any threat, which proved to be wrong. By thetime TerraCog realized their mistake in judging ³Birds´, the product was a huge success. In order not tolose the market, TerraCog also plans to launch a GPS with satellite imagery dubbed µProject Aerial¶. Asthe product was to be launched without any delay, a redesign within existing GPS platform was proposed.However, the projected costs threaten to scuttle the project.Sales team headed by Ed Pryor feels the new product Aerial should be priced below $425 tocapture the lost market share to the competitors. As per the estimate of pricing team, price for salewould, at the minimum, be $475. The price is quite too high for the sales team to consider. The key unitmanagers gather in a pair of contentious meetings that feature anger, finger pointing, blame and bewilderment, but produce no effective conclusion. The responsibility of pushing the group towards adecision lies with Emma Richardson, a newly promoted Executive Vice President of the Company. EmmaRichardson is in a dilemma whether to go ahead with the Project Aerial or not. CASE ANALYSIS

From the outset, it appears that determination of launch price of the product is the only problem in the case. But this is only a symptom of the bigger problem within the company. PROBLEMS AND INDICATORS


Lack of leadership
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