Brigitte Gagne has been appointed as the new R&D director of Le Petit Chef's microwave oven division. She must address issues in R&D and provide guidelines for project selection and funding levels urgently. Le Petit Chef faces increasing competitive pressures from Asian manufacturers in the low-end market and European manufacturers in the high-end market. It has expanded its product portfolio too quickly with limited R&D resources. Gagne should focus R&D on the high-end niche market, develop differentiating features, standardize components, and redistribute R&D engineers' work. She should fund cost reduction of the Eglite model, implementation of fuzzy logic controllers, and development of a new powerful magnet
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Brigitte Gagne has been appointed as the new R&D director of Le Petit Chef's microwave oven division. She must address issues in R&D and provide guidelines for project selection and funding levels urgently. Le Petit Chef faces increasing competitive pressures from Asian manufacturers in the low-end market and European manufacturers in the high-end market. It has expanded its product portfolio too quickly with limited R&D resources. Gagne should focus R&D on the high-end niche market, develop differentiating features, standardize components, and redistribute R&D engineers' work. She should fund cost reduction of the Eglite model, implementation of fuzzy logic controllers, and development of a new powerful magnet
Brigitte Gagne has been appointed as the new R&D director of Le Petit Chef's microwave oven division. She must address issues in R&D and provide guidelines for project selection and funding levels urgently. Le Petit Chef faces increasing competitive pressures from Asian manufacturers in the low-end market and European manufacturers in the high-end market. It has expanded its product portfolio too quickly with limited R&D resources. Gagne should focus R&D on the high-end niche market, develop differentiating features, standardize components, and redistribute R&D engineers' work. She should fund cost reduction of the Eglite model, implementation of fuzzy logic controllers, and development of a new powerful magnet
Copyright:
Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online from Scribd
Brigitte Gagne has been appointed as the new R&D director of Le Petit Chef's microwave oven division. She must address issues in R&D and provide guidelines for project selection and funding levels urgently. Le Petit Chef faces increasing competitive pressures from Asian manufacturers in the low-end market and European manufacturers in the high-end market. It has expanded its product portfolio too quickly with limited R&D resources. Gagne should focus R&D on the high-end niche market, develop differentiating features, standardize components, and redistribute R&D engineers' work. She should fund cost reduction of the Eglite model, implementation of fuzzy logic controllers, and development of a new powerful magnet
Copyright:
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Case study Le Petit Chef
This case depicts the need for a newly appointed R&D director of the company s flagship products to address R&D issues and to provide a guideline for proper R&D project selection and funding level in an urgent and imperative manner. The following were the main context that prompted the need for this swift action. Market: Le Petit Chef had experienced competitive pressure from European appliances manufactures for high end market in microwave oven due to Asian consumer electronics manufactures penetration to low-end, low-cost market. Technology: With company founder s objectives on cooking appliances that the technology strategy of the company was a technology pull based on the needs and wants from the customers Competition: Le Petit Chef had competitors from high-end market from Europe, its strong market segments as well as potential competitors from Asia that wrestling for the low-endmarket. Supplier: 35% of manufacturing costs of a basic unit was for Most of the microwave oven manufactures buy magnetron and high voltage power supply unit, two of the main components from the same suppliers like Sharp and Samsung. Le Petit Chef enjoyed the similar economics of scale on these components as its competitors. Leadership: With Brigitte Gagne as new R&D director for microwave oven division, she needed to make a pressing decision on project selections as well as the remake of Le Petit Increasing competitive pressures When Asian manufactures expanded their low-end microwave ovens into European markets that took away some profit margins that forced some large European companies (Electrolux and Bosch-Siemens) to move into up-market that in turn pushing down Le Petit Chef s profit margin. To counter these competitive pressures that Le Petit Chef spent much more than needed in advertising and promotion that cut into company s performance. Because the competition, the price of microwave oven also dropped by 10% each year from 1996 to 2000 that further reduce company s revenue. Other reason was the over extent their capabilities in the introductions of new products. With very limited R&D resources, Le Petit Chef had expanded its products from around 7 in 1995 to almost 30 different products in 1999. There were 7 ongoing projects in the pipeline and 5 proposed R&D projects. With the company size of 600, it could not compete with other well-funded big company like those Japanese, Korean companies for low-end, low-cost product and need to speed up the development of niche product that can differentiate their high-end higher margin product to attract customers.
Actions should be taken in this situation
1) Focus on high end market to narrow the scope of R&D research 2) Develop the features that differentiate among other products Customers only look for price and differentiate features in cooking appliances 3) With R&D scope narrowed, spend efforts to standardize features as well as components that provide competitive advantage. 4) Redeploy and redistribute the work among R&D engineers, since the electronic design determines a big portion of the cooking quality seen by customers besides the use of higher power magnetrons, the next engineer hired will be a designer.
The following projects should be funded
For short term: 1) Fund: project for Cost reduction of the Eglite to develop a low-cost a. Team members will be from both marketing and R&D engineer 2) Cut: (e) Add a larger cavity model to the Liberte line Reduce the resource spent and non-standardized components used. For long term: 3) Fund: Implementation of Fuzzy Logic Controller in microwave oven a. The goal is to provide a total differential feature to the microwave oven to the customer that would promote the sale. b. The implementation of fuzzy logic is not that difficult, Japanese and European companies have developed the controller that used in washer and dryer. This feature will be a big sale for the Europe and Japan Market. 4) Fund the develop of new and more powerful magnetron developed by supplier a. It will be easy to develop and add the differentiate feature to the product She handle the executive meeting well prepare with the facts for the meeting. 1) Rational strategy for selection R&D projects, 2) The facts on why the company performed poorly and the recommendation 3) How to improving company s financial situations
4) Re-establish Le Petit Chef as the leader of French Chef in the microwave oven It is will be like a kitchen in the executive meeting room, but for Gagne it will be a walk in the park for her to handle other executives.
