Critical Factors Affecting Decision

Recommendation for Manager

Risks
Future Projects Funding
Decision Effect on Product Quality
Morale Effect on Product Quality


Problem in having expenditure sanctioned
from senior management
Optical Systems OS business unit losses
since 1979, with rate of $3-5 million per year
(Burgelman, Christensen, & Wheelwright,
2008)
Different layers of approvals in the process
What guarantees that this new product will be
a success
Where to get the funding for this project and
how it will affect other projects in SSSD
Out of the four options presented, I would
recommend taking a staged approach:

I will not approve a full divisional funding

Try negotiating in order to take the incremental
approach by outsourcing the frame development
and cutting inventory

At the same time, encourage OS manager to take
the proposal to senior level mentors for support
It is important to be in the market first in
order not to lose first mover advantage
(Burgelman, Christensen, & Wheelwright,
2008)
Trying a hybrid approach will get as much
funding without heavily impacting the
division
Will not leave the market for the competition
and put the OS BU under pressure to deliver
The biggest risk is that the product will be
another failure for OS business unit
Not getting close attention from the two
distribution divisions: COSD and DSMD
(Burgelman, Christensen, & Wheelwright,
2008)
Having a single source for lamination supply
Existing and emerging competition with same
or better features
Required different sizes of screens and
market perceived value lower than $100
Providing a full fund for the OS project may
affect other promising projects, including
another one from the OS business unit
Need to diversify the funding options and
continually test for which project has the best
outcome in order to increase the funding for
it
Provide more funding for the two projects in
the Pacing Program
Other projects should try to attract other
sources of internal funding
Each of the three presented options has effect
on the quality of the product:
Getting the full fund will produce the highest
quality for the product.
Trying internal fund by outsourcing some parts or
cutting on inventory, will enforce the team to make
compromises on the quality on the resulting
product.
Trying to get the product for senior-level mentors
will even produce more constraints on the
resources and will produce a harder impact on
quality

Contented cows produce more milk (Cattlete,
& Hadden, 2012)
Morale is low and many are losing confidence
in making a viable business
This is not a healthy situation for producing
high product quality

Burgelman, R., Christensen, C. & Wheelwright,
S. (2008). Strategic management of
technology and innovation (5th ed.). New
York, NY: McGraw-Hill Irwin.
Catlette, B., & Hadden, R. (2012). Contented
Cows Still Give Better Milk, Revised and
Expanded: The Plain Truth about Employee
Engagement and Your Bottom Line. Hoboken,
NJ: John Wiley & Sons.