The first issue you chose to address with Kenisha is that production cost of the product appears to be too high versus the price customers would be willing to pay. The overwhelming sentiment of the focus groups conducted by the marketing department was that, although customers liked some of the advanced features of the Radio-DRM, they would not be willing to pay a higher price for these features. The result is that the profit margin for the Radio-DRM would be too low to justify going into production. Which of the following statements would be the best explanation for the rejection based on the fact that the profit margin for the Radio-DRM would be too low to justify going into production? a. One issue your team needs to address is production cost. Although customers liked some of the Radio-DRM's advanced features, focus groups revealed that they wouldn't be willing to pay a higher price for those features. In short, the profit margin on the Radio-DRM is unacceptable as the product is currently configured. Your team needs to take aim at eliminating features that increase costs but add little value to the customer.
b. We've got a problem with cost. You've put lots of bells and whistles in the Radio-DRM, and that drives up the cost, but customers in the focus groups don't want to have to pay for those bells and whistles. They see those features as "nice-to-haves" that maybe they'll use and maybe they won't, but they certainly don't want to pay extra for them. If we go into production with this prototype, the company will be lucky if they break even, much less make a profit. Back to the drawing board, Kenisha!
c. First, let's talk about cost. To be blunt, you and your team need to be customer-focused, not technology-focused. Think about features our customers want, not just features that you want. You've put so many bells and whistles into the Radio-DRM that the production cost would be ridiculously high, and the focus groups show that customers don't want to pay extra for a lot of features they may or may not use. In short, we'd be lucky to break even on the Radio-DRM, much less make a profit. You and your team need to tweak the design so that you cut some of the unnecessary features and lower the cost.
d. One reason we're rejecting the prototype is the cost. You've made this product so fancy and added so many features that it's going to be horrifically expensive to produce, and our customers don't want to pay that much. That's what the focus groups have told us. Stop over- engineering the products and develop something that our customers want and that we can make a profit from.
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