Tablet Computing Market Strategies

Introduction

In order to improve, people function best in consistent environments. Unfortunately, real life is so clouded over with a veritable plethora of variables beyond the control of any one individual that it is often difficult to ascertain with any genuine reliability what, precisely, the impact of one’s decisions may be. Fortunately, in this day and age, computer simulations are so widespread that far from being mere games, alternate realities with a more limited set of rules than the chaos that governs daily life have even been created to help students of marketing and business, in general, explore the consequences of decisions through free online applications such as the Tablet Simulator. Nevertheless, like all free computer applications, sometimes the results can seem less than ideal as a teaching tool. Indeed, when placing oneself in the position of the vice president of marketing for the hypothetical company and running the simulation many times as if the years 2012 to 2016 were constantly repeating as if in a time warp, it can be seen that regardless of the decisions made, whether reactive or proactive, the same pervasive results are generated time and again, such that it is difficult to get the final score to deviate from the 1.3 to 1.5 billion range.

Status Quo Strategy

In the alternate reality where there is no escaping the years 2012 to 2016, once upon a time the posited former vice president of marketing, Joe Schmoe, undertook a strategy of maintaining the status quo in every regard, with a resulting score actually rather on the high end of those results given here at slightly over 1.5 billion. Joe Schmoe, the fictional antihero of Clipboard Tablet Co., leaves the price points on all three tablets, from pricey and flashy X6 to lowly, unproductive X7, the same. Too, he maintains the even division of research and development (R&D) resources the same for four years, and he does not discontinue any products. As a result, he receives messages early on that the X6 is doing well, then that the X7 has a potential growth market, then that X5 sales are slacking, and finally that everything seems to be basically middling compared to competitive products, though some price points are higher with Clipboard Tablet Co. He has failed to improve upon the ailing X7’s performance or to adapt to the shift in the market concerning price and demand for the X5 and X6, and yet his final score is, in the final analysis, perfectly normal compared to that of experiments discussed later. True, he has not approached the posted high score of 2.1 billion, but in the end, such a score proves unattainable anyway.

Conservative Change Strategy

Not being Joe Schmoe, this author chose to explore at first several conservative strategies toward change yet never managed to top Joe Schmoe’s score by more than a relatively paltry 20 million. Such strategies involved changing price points by no more than $50 at a time and re-allocating R&D resources in 50-25-25 ratios, varying which tablet received the lion’s share of the funding and other aspects according to the information received at the end of each year. After over ten iterations of such explorative ventures into mildly changing the numbers, it was obvious that the resulting score was never going to come terribly close to breaching the 1.6 billion mark, let alone touching the 2.1 billion maximum. This may be in part due to the reactive nature of the responses to the data received; after all, in the high-performance programming model of organizational diagnostics, “reactive” companies are placed lowest on the totem pole (Falletta, 2009, p. 18). It is also true that the same messages about performance were generated regardless of the particular changes made—X5 topping out around the third year, the X6 showing growth right up until the end, and the X7 continuing to struggle throughout. In some ways, these results are actually reflective of a realistic technology market, in which outside factors can have much more sway than internal decisions more so even than in business in general. Forman and Zahorjan (1994) allude extensively to such difficulties, and in the intervening years, the prevalence of technology companies being outpaced by the rate of change of the market can be said to only have increased. Thus, it becomes necessary not only to respond to alterations in the nature of one’s field of business but even to anticipate such upcoming upheavals. This tactic is much easier to implement when one has the ability to relive the same four-year period many times over.

Daring Change Strategy

Upon doing the time warp again, it quickly became apparent that more drastic changes would need to be undertaken, and yet such endeavors did not, in the end, yield superior results. Far from it and to the contrary; instead, making daring but realistic changes only decreased the score down to around 1.3 billion and, in one notable case, even slightly below that number. It was natural, at first, to contemplate completely discontinuing the X7 at least for the first year or two, even knowing that the end of the second year would likely yield a resulting message to the effect of there being lots of potential for growth with the X7. By itself, this decision seemed to have almost no effect on the 1.5 billion score range, but if the discontinuation continued past the second year, or if other larger changes were incorporated, that number promptly plummeted to the lowest scores that were here found to be attainable. Other changes explored were raising the price point for the X6 early on in anticipation of its future growth and demand, lowering prices more dramatically than by the $50 increments described above, and discontinuing the X5 when it was anticipated that its usefulness would soon peak. None of these approaches proved particularly lucrative, though it must also be said that neither did they cause the scores to dip much below 1.3 billion. Neither did changing the allocation of R&D funds, sometimes to as much as 100% on a single product, seem to cause anything remarkable to happen to the score, in spite of the fact that such measures were at the very edge of what could be considered reasonable for an actual vice president of marketing to undertake. Overall, without behaving in such a ludicrous manner as to seem like obvious sabotage to the company, the lower end of the score bracket proved to be as immovable as the upper end for the purposes of the exploration undergone here.

Conclusions

It is rather disheartening to note the complete lack of ability on the part of the vice president of marketing to impact Clipboard Tablet Co.’s performance over the 2012 to 2016 date range, for regardless of price changes, discontinuations, and other measures, the numbers remained stubbornly immobile. However, it is also obvious from the constellation of results presented here that the particular reality described by this simulation favors more conservative measures and generally seems to come from an attitude of frowning upon larger swings of the pendulum. It is particularly striking, though, that the discontinuation of the X7 was the one measure with which a user of the simulation could get away without harming results considerably. This may be a result of the system deliberately rewarding de-escalation from an ailing product line. As Woolley (2013) puts it: “Many organizations struggle to reduce commitment to failing endeavors. While such de-escalation mechanisms have been documented and tested in information technology, accounting, psychology, and organizational behavior, little work has addressed de-escalation in innovation” (p. 1). Thus, a cessation of the pouring of resources into a product that simply is not selling well may actually be ideal and one of the few changes that can actually make a difference.

Perhaps with more time and many more iterations of the simulation, a more ideal solution could be found, but this perfect mix was ultimately unattainable for the run of about thirty times through performed here. Still, the exercise proves very instructive in that in some ways it shows how little impact the decisions over which managers might agonize can have. Knowing that one cannot change one’s results, either in the heroic or the villainous directions, is in some ways freeing in that it allows allocation of resources toward taking a broader view rather than going too deep on any one issue. As in business, so in life; truly, to know that the limits on one’s own power are bounded is valuable. 

References

Falletta, S. V. (2005). Organizational diagnostic models: A review and synthesis. White paper. Sunnyvale, CA.

Forman, G. H., & Zahorjan, J. (1994). The challenges of mobile computing. Computer, 27(4), 38-47.

Woolley, J. L. (2013). De-escalation mechanisms in high technology product innovation. Journal of Product Innovation Management. Forthcoming.