Challenges Faced by a Company When Developing New Products in the Global Economy - Research Paper Example

?MARKETING Challenges faced by a company when developing new products in the global economy The need to explore new business ventures drives enterprises into designing new products as well as introducing their existing products into new markets. Existence of barriers into markets however exists posing challenges to the development of new products in international markets. Though some of the challenges into penetrating new international markets may be based on regulatory measures in the markets, a large number of challenges are derived from the organizations, their processes, and their production environments. Such includes managerial, organizational, and technological factors (Kumar and Addie, 2006). Global challenge 1 One of the challenges that an organization is most likely to face in developing and launching its products in the international market is its management efficiency with respect to the production process. This challenge was particularly identified in the development of Hexopater. Management of the production process of a product, whether a locally marketed product or one that targets the international market, has many impacts on the quality of the product to be produced as well as the reliability in the continuous flow of the product into its market. An effective management of a production process begins with development of aims of the production as well as the features of the product, a stage that is crucial and defines the destiny of the product. Inability to develop focused goals that can yield a successful production as well as failure to identify captivating features that will attract customers therefore forms a significant challenge to product launch in the global market. This is because a challenged set of development goals, coupled with poor specification may lead to poor standards that may not be acceptable for clearance across borders (Kumar and Addie, 2006). Managing the production process also poses a challenge to the product development based on outlined procedures in the production process. Like in developing production goals, poorly outlined procedures adversely affect the overall quality of the product and hence its acceptance in the international market. Development of the Hexopater also identified inappropriate human resource skills as a challenge to product development and launch. This is because the human resource competence level is reflected in the production process, quality and the image that consumers and even regulatory bodies develop over a product. The overall plan of the production process as well as sales initiatives also determines the extent of challenges that a product can experience in penetrating an international market. Management of the production process is therefore a significant challenge in any product development as it applied to Hexopater (Kumar and Addie, 2006). Global challenge 2 Another challenge facing development of products in global markets is the level of regulations that are instituted by different territories. Though most regulatory measures are meant to check on safety of products to be allowed from other economies, some regulatory measures are done on economic grounds. The impact however remains the same, that regulations undermines the ability to develop and market a product in the international market. An example of such regulation is the European union’s move to regulate “tissue related products” (Dodin, 2010, p. 1). This particular regulatory initiative was meant to harmonize laws in the region and to ensure that the developments in scientific processes are monitored and regulated effectively. While the regulations ensured common application of rules in the region, it influenced original regulations in each countries in either way. It either lowered standards for the countries that were highly regulated and raised standards for countries that were poorly regulated. The greatest challenge to new product development in the region would therefore be significant in the countries that were previously less strictly regulated. A firm that could, and had planned to develop its product is a lowly regulated economy would therefore suffer a set back if stiffer rules were formulated before the product development (Dodin, 2010). Regulatory measures that outline criteria for certification of operation also influence an organization’s capacity to explore a market. Based on the regulations, the body in charge can determine the number of participants in the market in order to ensure sustainability and quality of production. The tissue engineered product being a sensitive health issue attracted universal regulation that the industry’s stakeholders had desired to facilitate ‘large-scale’ productions. Such regulations, that consider the minimum production capacity at which a producer can be allowed to venture into a market therefore induces a challenge to small and medium sized enterprises. The European Union’s regulations over the ‘tissue-engineered’ products therefore identifies a source of regulatory challenge into developing a product in the global market (Dodin, 2010). Global challenge 3 Technology has also emerged to be an example of challenges that face organizations in their operations and marketing. Development of computerized applications that manage production processes and marketing techniques means that poor technology implies poor quality output or lost marketing opportunity in the global market. In a research conducted by Kim and Wilemon to investigate the significance of challenges in product development, technology based issues registered a high percentage of unresolved problems. This means that organizations are sometimes forced to run their processes with compromised technology. Some of the major factors that contribute to technological challenges include lack of adequate operational knowledge and skills, poor communication between involved parties, and inability to relate the customer needs with the technology for appropriate design. These lead to compromised products that might not be acceptable to consumers with available international and domestic products from competitors. Inappropriate application of technology therefore challenges successful development of a product and as a result adversely affects its successful launch in the global market (Kim and Wilemon, 2009). Technology solutions Application of information and technology has been a critical tool in marketing. This has been facilitated by the scope of marketing that conveys information about a product to consumers and potential consumers. Marketing initiatives such as advertisements have consequently been reliant on technology due to its efficiency and effectiveness among other advantages. Technology example 1 Advertisement is a particular avenue through which technology has significantly contributed to marketing efforts. Having been established as a widely used medium for communication, technology has been adopted as an advertisement avenue. One of the main reasons for establishment of technology as a tool in marketing is its popularity among people. As a result, organizations have been shifting from traditional advertising media to electronic advertisements. Chiropractic, in Canada, is an example of application of technology in marketing initiatives. A survey that was conducted over chiropractic websites noted that a significant number of the websites contains advertisements for commercial products to consumers. Precisely, more than seventy percents of the subject websites advertises products. A lot of success has also been realized through the online advertisements. The survey, as conducted by Page, reported as high as fifty percent of sales of some chiropractic commodities are attributed to advertisements through electronic media. With the remaining percentage attributable to other sales initiatives, technological development into online communication has significantly contributed to efforts to enhance marketing (Page, 2007). Technology example 2 Technology has also indirectly contributed to marketing initiatives through development of preliminary information that forms basis for formulation of marketing initiatives. Developing existing data over operations that are applicable in monitoring and evaluation, for instance forms ground for marketing decision making. Analysis of trends in demand and consumer tastes for example forms ground for formulation marketing strategies and efforts because the reported information offers insight of the nature of the market. A good example of application of technology to enhance marketing efforts is the application of statistical analysis tools to evaluate trends in the market or mathematical analysis for determining relationship between different marketing initiatives and consumer’s responsiveness towards the purchase of the products. This way, technology forms grounds for forecasting trends in marketing. Technology also enhances efficiency in human resource. A marketing department that is equipped with sufficient technology will therefore be more productive with respect to marketing initiatives results (Stone, Good and Eleveth, 2007). Technology example 3 Technology’s contribution to marketing can further be explained through research and development approach. Applbaum explains that research and development are preliminary conditions for marketing initiatives as they establish a stable ground for marketing. Pfiza Company, in the year 1991, developed this approach to marketing and earned the fruits. The integration of research and development with marketing relies on the concept that marketing process should enlist interest of stakeholders in the product to be marketed. Technologies for undertaking research into the opinions of these parties therefore become crucial to achieving a successful marketing. It can therefore be concluded that technology plays an important role in attaining success of marketing initiatives (Applbaum, 2009). Legal and ethical implications The target of media advertisement, being people, induces both legal and ethical implications on the advertisers and the media. While legal aspects related to established rules of the land, ethics are a set of moral values that are held by a society. Ethical implication 1 Advertisements in the media, whether by organizations marketing teams or critics of an industry, should be regulated by both ethical and and legal aspects. Initiatives to negatively criticism of an industry for example raise ethical concerns over the role of the media in advertisements and information. Applbaum, particularly characterizes such negative criticisms an unethical as they only derails progress of players in the industry and undermines marketing strategies. Similarly, legislations and political opinions from legislators, that are published by media have also been identified to defy ethical values and on the contrary undermined marketing initiatives in an industry (Applbaum, 2009). Ethical implication 2 Even though ethical obligations are not enforceable on people and entities, there is an implied social responsibility on parties to uphold ethical values. As a result, advertisers as well as the media are supposed to be keen on the content of advertisements and the social impacts that such advertisements can cause. An advertisement by “Australian White Ribbon Day 2006” for instance drew ethical concerns with opinions that it portrayed elements of suicide, an act that is socially immoral. The advertisers had to apologize and offer their original interpretation of the advertisement as opposed to the suicidal perception (Donovan et al, 2009). Legal implication Presentation of misleading information in advertisements is another issue that faces the media. This leads to both legal and ethical concerns. In the European Union for example, information in an advertisement should correspond to the features that it represents in the product. A breach of this principle leads to legal liability. It further enlists ethical values such as the principle of beneficence in which actions are supposed to be intended for the good of all members of the society. Misrepresentation of facts in an advertisement is to the contrary a selfish initiative that may lead to disappointment or even harm to the audience (Nilsson, 2012). Reference Applbaum, K. (2009). Is marketing the enemy of pharmaceutical innovation? Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=1c643c65-99d2-4847-8b2e-fa531eb198c4%40sessionmgr111&vid=2&hid=102 Dodin, L. (2010). Regulatory enablers and regulatory challengers for the development of tissue-engineered products in the EU. Bio-medical materials and engineering. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=25346d29-a169-4bb0-92e3-200465fdd8eb%40sessionmgr11&vid=2&hid=102 Donovan, R., Jalley, G. and Fielder, L. (2009). Ethical issues in pro-social advertising: the Australian 2006 White Ribbon Day campaign. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=17b86fc5-a669-49b1-8db5-6193a45d549e%40sessionmgr12&vid=2&hid=102 Kim, J. and Wilemon, D. (2009). An empirical investigation of complexity and its management in new product development. Technology analysis & strategic management. Vol. 21. No. 4. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=2ccfcf2e-b1a7-4ffc-aff3-d029546ad6ae%40sessionmgr115&vid=2&hid=102 Kumar, S. and Addie, H. (2006). The Hexopater, from birth to market: innovative product development challenges. Journal engineering design. Vol 17. No. 3. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=1339c091-c0ed-4c59-a161-6287f139d0c1%40sessionmgr104&vid=2&hid=102 Nilsson, K. (2012). Misleading? To who? Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=67ebff92-72fc-4ab7-a7a2-7aa9b0e2eb29%40sessionmgr14&vid=2&hid=102 Page, S. (2007). An audit of health products and services marketed on chiropractic websites in Alberta and consideration of these practices in the context of chiropractic codes of conduct and ethics. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=24138562-1445-4c40-bebe-3f1567d052a9%40sessionmgr13&vid=2&hid=102 Stone, R., Good, D. and Eleveth, L. (2007). The impact of information technology on individual and firm marketing performance. Retrieved from: http://ehis.ebscohost.com.proxy.cecybrary.com/ehost/pdfviewer/pdfviewer?sid=42cd4b93-de35-4abf-b93a-31f4c68eff90%40sessionmgr15&vid=2&hid=102 Read More