Electrical Bt·oom and Supply Co. IMSCO began manufacturing and distributing elec

Question

Electrical Bt·oom and Supply Co. IMSCO began manufacturing and distributing electrical brooms to industrial customers 43 years ago. Mr. Bretting, president of IMSCO, has been toying with the idea of using IMSCO's manufacturing and distribution expertise to begin making and selling consumer products. He has already decided that he cannot sell any of his current products to consumers. Also, if IMSCO is going to go to the trouble of developing consumer markets, Mr. Bretting feels very strongly that their first product should be something new and innovative that will help establish their reputation. He thinks that the expertise required to develop a new product exists within the company, but no one has any real experience in organizing or managing such a project. Fortunately, Mr. Bretting is familiar with a local consulting firm that has a good reputation and track record of leading companies through projects such as this, so he contacted them. Three months into the project, Mr. Bretting contacted the program manager/consultant and mentioned that he was worried about the amount of risk involved in trying to introduce such an innovative consumer product with his current organization. He was worried that the project was oriented too strongly toward R&D and did not consider related business problems in enough depth. (This was a complete about-face from his feelings three months earl.ier, when he had approved the first plan submitted with no changes.) Mr. Bretting suggested that the consultant modify the existing project to include the introduction of a "me-too" consumer product before IMSCO's new product was defined and tested. Mr. Bretting thought that some experience with a "me-too" product would provide IMSCO management with valuable experience and would improve later performance with the new product. He allowed the R&D portion of the project to continue concurrently, but the "me-too" phase would have top priority as far as resources were concerned. The consultant said she would think about it and contact him next week.

If you were the consultant, what would you recommend to Mr. Bretting? Would you continue the relationship?

Explanation / Answer

If I was the consultant, I would consider Mr Bretting's decision to be correct and wise. The reasons behind doing so are strong enough to make the decision. As the "me too" product that Mr Bretting had thought of would give a good experience to manage the new product that was initially planned by him. This would lower the risk involved in making this new product. This would also give an opportunity to see the problems and risks involved from all aspects and not only the R&D portion. As Mr Bretting mentioned that the project to be continued as it was and the "me too" product be worked on along with it with a priority to it for the use of resources. This approach can be fruitful and productive for the organization.

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