MANAGEMENT TEST 2

QUESTION 1

A. DISCUSS THE THREE ROLES OF MARKETING

B. DESCRIBE IN DETAILS THE MARKETING PLANNING PROCESS

 C. DISCUSS THE PRODUCT LIFE CYCLE WITH THE AID OF A DIAGRAM

A product life cycle is the length of time from a product first being
introduced to consumers until it is removed from the market. A
product’s life cycle is usually broken down into four stages;
introduction, growth, maturity, and decline.

Product life cycles are used by management and marketing professionals to

help determine advertising schedules, price points, expansion to new
product markets, packaging redesigns, and more. These strategic methods of
supporting a product are known as product life cycle management. They can
also help determine when newer products are ready to push older ones from
the market.

How Does it Work?

As mentioned above, there are four stages in a product’s life cycle - introduction,
growth, maturity, and decline – but before this a product needs to go through
design, research and development. Once a product is found to be feasible and
potentially profitable it can be produced, promoted and sent out to the market.
It is at this point that the product life cycle begins.
The various stages of a product’s life cycle determine how it is marketed to
consumers. Successfully introducing a product to the market should see a rise in
demand and popularity, pushing older products from the market. As the new
product becomes established, the marketing efforts lessen and the associated
costs of marketing and production drop. As the product moves from maturity to
decline, so demand wanes and the product can be removed from the market,
possibly to be replaced by a newer alternative.

Managing the four stages of the life cycle can help increase profitability and
maximise returns, while a failure to do so could see a product fail to meet its
potential and reduce its shelf life.

Writing in the Harvard Business Review in 1965, marketing professor Theodore

Levitt declared that the innovator had the most to lose as many new products
fail at the introductory stage of the product life cycle. These failures are
particularly costly as they come after investment has already been made in
research, development and production. Because of this, many businesses avoid
genuine innovation in favour of waiting for someone else to develop a successful
product before cloning it.
Stages
There are four stages of a product’s life cycle, as follows:

1. Market Introduction and Development

This product life cycle stage involves developing a market strategy, usually
through an investment in advertising and marketing to make consumers aware
of the product and its benefits.

At this stage, sales tend to be slow as demand is created. This stage can take
time to move through, depending on the complexity of the product, how new
and innovative it is, how it suits customer needs and whether there is any
competition in the marketplace. A new product development that is suited to
customer needs is more likely to succeed, but there is plenty of evidence that
products can fail at this point, meaning that stage two is never reached. For this
reason, many companies prefer to follow in the footsteps of an innovative
pioneer, improving an existing product and releasing their own version.

2. Market Growth

If a product successfully navigates through the market introduction it is ready to

enter the growth stage of the life cycle. This should see growing demand
promote an increase in production and the product becoming more widely
available.

The steady growth of the market introduction and development stage now turns
into a sharp upturn as the product takes off. At this point competitors may enter
the market with their own versions of your product – either direct copies or with
some improvements. Branding becomes important to maintain your position in
the marketplace as the consumer is given a choice to go elsewhere. Product
pricing and availability in the marketplace become important factors to continue
driving sales in the face of increasing competition. At this point the life cycle
moves to stage three; market maturity.

3. Market Maturity

At this point a product is established in the marketplace and so the cost of

producing and marketing the existing product will decline. As the product life
cycle reaches this mature stage there are the beginnings of market saturation.
Many consumers will now have bought the product and competitors will be
established, meaning that branding, price and product differentiation becomes
even more important to maintain a market share. Retailers will not seek to
promote your product as they may have done in stage one, but will instead
become stockists and order takers.

4. Market Decline

Eventually, as competition continues to rise, with other companies seeking to

emulate your success with additional product features or lower prices, so the life
cycle will go into decline. Decline can also be caused by new innovations that
supersede your existing product, such as horse-drawn carriages going out of
fashion as the automobile took over.

Many companies will begin to move onto different ventures as market

saturation means there is no longer any profit to be gained. Of course, some
companies will survive the decline and may continue to offer the product but
production is likely to be on a smaller scale and prices and profit margins may
become depressed. Consumers may also turn away from a product in favour of
a new alternative, although this can be reversed in some instances with styles
and fashions coming back into play to revive interest in an older product.

Product Life Cycle Strategy and Management

Having a properly managed product life cycle strategy can help extend the life
cycle of your product in the market.

The strategy begins right at the market introduction stage with setting of pricing.
Options include ‘price skimming,’ where the initial price is set high and then
lowered in order to ‘skim’ consumer groups as the market grows. Alternatively,
you can opt for price penetration, setting the price low to reach as much of the
market as quickly as possible before increasing the price once established.

Product advertising and packaging are equally important in order to appeal to

the target market. In addition, it is important to market your product to new
demographics in order to grow your revenue stream.

Products may also become redundant or need to be pivoted to meet changing

demands. An example of this is Netflix, who moved from a DVD rental delivery
model to subscription streaming.

Understanding the product life cycle allows you to keep reinventing and
innovating with an existing product (like the iPhone) to reinvigorate demand and
elongate the product’s market life.

Examples
Many products or brands have gone into decline as consumer needs change or
new innovations are introduced. Some industries operate in several stages of
the product life cycle simultaneously, such as with televisual entertainment,
where flat screen TVs are at the mature phase, on-demand programming is in
the growth stage, DVDs are in decline and video cassettes are now largely
redundant. Many of the most successful products in the world stay at the
mature stage for as long as possible, with small updates and redesigns along
with renewed marketing to keep them in the thoughts of consumers, such as
with the Apple iPhone.

Here are a few well-known examples of products that have passed or are
passing through the product life cycle:

1. Typewriters

The typewriter was hugely popular following its introduction in the late
19th century due to the way it made writing easier and more efficient. Quickly
moving through market growth to maturity, the typewriter began to go into
decline with the advent of the electronic word processor and then computers,
laptops and smartphones. While there are still typewriters available, the product
is now at the end of its decline phase with few sales and little demand.
Meanwhile, desktop computers, laptops, smartphones and tablets are all
experiencing the growth or maturity phases of the product lifecycle.

2. Video Cassette Recorders (VCRs)

Having first appeared as a relatively expensive product, VCRs experienced large-

scale product growth as prices reduced leading to market maturation when they
could be found in many homes. However, the creation of DVDs and then more
recently streaming services, VCRs are now effectively obsolete. Once a ground-
breaking product VCRs are now deep in a decline stage from which it seems
unlikely they will ever recover.

3. Electric Vehicles

Electric vehicles are experiencing a growth stage in their product life cycle as
companies work to push them into the marketplace with continued design
improvements. Although electric vehicles are not new, the consistent innovation
in the market and the improving sales potential means that they are still growing
and not yet into the mature phase.
4. AI Products

Like electric vehicles, artificial intelligence (AI) has been in development and use
for years, but due to the continued developments in AI, there are many products
that are still in the market introduction stage of the product life cycle. These
include innovations that are still being developed, such as autonomous vehicles,
which are yet to be adopted by consumers.

Conclusion
Understanding how a product’s life cycle works allows companies to work out
whether their products are meeting the needs of the target market and, thereby,
when they may need to change focus or develop something new.

Examining a product in relation to market needs, competition, costs and profits

allows a company to pivot their product focus to maintain longevity in the
marketplace.

Knowing when a product is going into decline prevents your company from
following as a result of being overly reliant on a fading market. A product life
cycle strategy means that you can reinvigorate an existing product, develop a
new replacement product or change direction to stay abreast of a changing
marketplace.

While all products have a life cycle, many of the most successful ones are able to
maintain the mature stage of the life cycle for many years before any eventual
decline.
QUESTION 2

A. SIX STEPS INVOLVED IN THE PRODUCT DESIGN PROCESS

 B. LIST ANY FOUR OBJECTIVES OF PRODUCT AND SERVICE DESIGN SECONDARY FOCUS

C. DISCUSS THE IMPORTANCE OF INDUSTRAIL RELATIONS

1. Promotes democracy:

Industrial relations means using collective bargaining to settle problems faced by

workers. This collective bargaining is usually achieved through mutual cooperation and
mutual agreement amongst all the affected parties i.e., democracy, management and
employees unions. This helps an organization to establish industrial democracy, which
hence motivates the workers to contribute their best to the growth and prosperity of the
organization.

2. Economic growth and development:

Economic growth and development can be improved through industrial relations. This
refers to the economic conditions of workers in the existing state of industrial
managements and political government. With the well known fact that Good industrial
relations lead to increased efficiency and hence higher productivity and income, it also
imperative to note that this also results in economic development of the country.

3. Boosts employee morale

It is important to note that Good industrial relations which is built-in mutual

cooperation and common agreed approach motivate one to contribute one’s best, result
in higher productivity and hence income, give more job satisfaction and help improve
the morale of the workers which is an importance of industrial relations in HRM.

4. Accountability and optimum use of scare resources:

Industrial relations which is Good and harmonious creates a sense of belongingness and
group-cohesiveness among workers, and also a congenial environment resulting in less
industrial unrest, grievances and disputes. This will ensure optimum use of resources,
both human and materials, eliminating all types of wastage.

5. Avoids conflicts between management and unions:

Industrial relations results in reduced conflicts between unions and management. This
is because industrial relations involves setting up a machinery to solve problems
confronted by management and employees through mutual agreement to which both
these parties are bound. This results in avoiding any unfair practices that could lead to
major conflicts between employers and trade unions.

6. It prompts depiction of sound labor legislation:

Industrial relations necessitate passing of certain labor laws to protect and promote the
welfare of labor and safeguard interests of all the parties against unfair means or
practices.
7. Initiates an environment for change:

Good industrial relations help in improvement of cooperation, team work, performance

and productivity and hence in taking full advantages of modern inventions, innovations
and other scientific and technological advances. It helps the work force to adjust
themselves to change easily and quickly
D. LIST FOUR WAYS HOW INDUSTRIAL RELATIONS CAN BE IMPROVED
QUESTION 3
A. WHAT IS THE DIFFERENCE BETWEEN BENCHMARKING AND KEY PERFORMANCE INDICATOR

While a benchmark has a company comparing its processes, products and operations with
other entities, a key performance indicator (KPI) measures how well an individual, business
unit, project and company performs against their strategic goals

B. DISCUSS THE IMPORTANCE OF BENCHMARKING IN AN ORGANIZATION

C. LIST FOUR FACTORS THAT AFFECT PROJECT PREFORMANCE

D. WHAT IS THE DIFFERENCE BETWEEN MONITORING AND CONTROLLING

 Monitoring is the collection, recording, and reporting of project
information that is of importance to the project manager and other
relevant stakeholders. Control uses the monitored data and
information to bring actual performance into agreement with the
plan.

QUESTION 4