Establishing and Maintaining Project Alignment - Example

New Product Development Business Plan Name: Institution: Date: Table of Contents 1.0 Introduction 3 2.0 Product 4 3.0 Business Analysis 7 3.1 Cost 7 3.2 Time 9 3.3 Risk 10 3.4 Expected Benefits 11 4.0 Test Market 11 5.0 Launch 13 6.0 Budget 16 7.0 Conclusion 16 References 18 1.0 Introduction Globalisation has led to the emergence of new business concepts in the industry. As such, a majority of the organisations have developed internationalisation strategies in a bid to capture and expand in such respective international markets. Consequently, this has facilitated increased market expansion and industrial growth. Through the increased development and growth of the international trade, the global economy has expanded with nations, both developed and developing enlarging their gross domestic product (GDP) bases (Giulioni, 2011). This is evidenced by the increased per capita income values in the global market. In this regard, the per capita value in respective nations has considerably increased. Sharma and Mishra (2012) argued that through increased per capita income, individuals have improved their living standards as well as need hierarchy. The Maslow’s hierarchy of needs can be best used to explain this concept. The theory argues that once an individual needs at a given level are met, the needs evolve onto the next sequential level. Therefore, the global market needs have evolved from basic and safety needs to the social and self esteem levels. As such, this facilitated the need for movement and adventure in pleasure fulfilment. Consequently, the tourism industry has emerged as among the fasted growing global industries in the market. Yeoman and McMahon-Beattie (2006) argued that statistics demonstrate that the industry has both current and forecasted expansion potential in the industry allowing for increased investment. Thus, venturing into this market is a viable economic decision that would yield products increased earnings and revenues both in the present and in the future. This business plan seeks to venture into the tourism industry. As such, the plan outlines the process of developing a new tour guide application, TourApp, an improvement of the existing tour guide applications in the market. Through this proposed product venture, this business plan highlights the estimated revenues both in the short and in the long run as a verification of the new product development idea viability. 2.0 Product The proposed TourApp new product for adoption is a tour guide application. The application will be used as a tool by the tourists to guide their way through the desired tourist attraction areas. In the recent past, the need for human tour guides has increased. As a result, tour guide companies have been forced to recruit an increased number of employees to serve as tour guides. This has two strategic implications. On one hand, the process increases the overall organisational operational costs in the market. The process of recruiting, retaining, training and rewarding a large employee base is overly expensive in the market. As a result, this process has led to reduced organisational profitability levels in the industry. Fowler (2012) conducted a study to evaluate the implications of high labour forces in an organization. In its review, the study hypothesised that although a high labour workforce had a merit in increased productivity; it had cost implications on the respective organisations. In its analysis, the study established that organisations with a high labour workforce faced increased costs of production. This phenomenon can be explained through the application of the law of diminishing marginal returns. This law argues that additional of resources add value to an optimum level beyond which such resources additional does not contribute to the overall revenue gains. This has been the situation with the tourism industry organisations. In this case, increased organisational spending in hiring additional tour guides results to increased expenses, negating the overall industry profitability levels. Moreover, this high labour costs have increased the overall capital investments requirements in venturing into the market. As such, this has denied small business and investors from investing into the industry. Thus, this necessitates the development of alternative avenues for guiding the organisational consumers. In addition, as argued above, organizations in the tourism industry face resources constraints in their human resource hiring approaches. As such, this has created an increased strain on the quality of available tour guides. Toh, Khan and Lim (2001) conducted a study to evaluate challenges facing tourists in the global market. In its analysis, the study established that among other challenges poorly trained tour guides were ranked among the top challenges. In addition, the study established that a shortage of these guides was among the issues raised. In this case, due to their shortage, tourists have been forced to pay increased costs to hire such guides. In addition, a majority of the organisations have forced the trend of booking guides in advance to secure their availability. Consequently, combinations of these issues have resulted to increased travel and tourism costs. The success and growth of the tourism industry is driven by two key strategic drivers namely comfort and affordability. On one hand, the hiring of incompetent tour guides negates the essence of comfort, as they deny the tourists an opportunity to enjoy their travel tours. On the other hand, increased tour guides hiring costs negate the concept of affordability in the industry and thus it is apparent that the industry faces a major crisis. Moreover, this presents market gap and viability verification for the proposed tour guide application. The application will be utilised by the travel and tour guide agencies as well as the tourists. On one hand, the travel guide agencies will rely on this application to reduce on the need to hire an increased workforce. Instead of hiring actual travel guides for their clients, the organisations will hire and train trainers. The organisational trainers will be charged with the responsibility f training the respective organisational clients on the operations and use of the tour guide application. From the onset, the organisation will require their clients to fill online query forms through which they identify and list their travel destination preferences, either in order of priority of at random id they have no priority ranking. Consequently, based on these applications, the organisations will develop a logical and cost effective travel schedule for their clients whose application and use will enhance efficiency. In turn the organization will customise the tour guide application to fit into these consumer needs requirements. In pursuance to this, the organisation will allocate respective clients to specific employees for training and orientation. Once the clients arrive for their tour, the assigned employees will be required to brief the clients on the developed logic for travel and subsequently install the application on the clients’ mobile devices to allow for use convenience. In developing the proposed TourApp application, a number of features will be considered. One among them is compatibility with various platforms such as the mobile application platform. As such, the proposed application will be developed and based on android application interphase. Android is currently the trending mobile application interphase. Therefore, this will enable the application attain increased compatibility with clients devices. In addition, in order for the application to cover clients with devices such as laptops, it will be developed in compatibility mode for Windows, XP and Linux operating systems. In order to enhance ease of use and understadability by both the tourism industry travel guide agencies as well as the tourists themselves, the application will be written using the C++ programming language. The process of deciding features for inclusion in the TourApp application was developed based on the tourists needs. In order to evaluate these factors, a review on travel needs was conducted on the existing secondary data obtained from the travel agencies. In a list of many requirements and for the purposes of facilitating compatibility and ease of use of the application, the product development resulted to the inclusion of key features in the travel locations. In this regard, the application incorporated a localised map of the desired tour area. This feature is unique from other market applications offered by other organisations such as Google. On its part, the application is selective; instead of offering a wholesome area map with un-required details the application highlights the key features and areas of preference. Such highlighted areas are restaurants, security offices, hospitals, as well as accommodation facilities. As such, the application offers the consumers with concise but comprehensive knowledge of the areas preferred for travel. In addition to highlighting the preferential locations, the application will partner with such locations to provide their schedules, offers and costs on services. Therefore, upon the clients request on clicking on the facilities, they will be provided with the database information. Consequently, the application will enable clients make choices on preferential locations based on products as well as on the cost implications. Finally, the application will serve as a distress call. Upon danger or confusion for instance loss of way in the wilderness or toured area, the application will provide a portal through which when dialled will raise an alarm with the service providing organisations. Consequently, the respective organisations can initiate clients securing mission or alternatively inform the relevant authorities for action. Therefore, based on these features, it is expected that the introduction of this application software will resolve the tourism travel guide challenges. 3.0 Business Analysis 3.1 Cost In developing the product, the project anticipates a range of increased cost implications. Therefore, in order to determine if the product should proceed to the actual development stage in the new product development process (De Beer, Booysen, Barnard & Michèle Truscott, 2005). An analysis on costs was based on the concepts and implications of the testing study as well as market forecasts in the analysis. As reflected in this business plan analysis the products development process require the input of various stakeholders as well as resources. On one hand, the business venture will utilise raw materials in the form of technology requirement for the hosting of the proposed plan. In this case, the developed software will be packaged in DVD storage devices. As such, the product development process will incur costs in developing such infrastructure. On the other hand, the product seeks to establish a cloud storage computing process in the market (Dhar, 2012). The product venture in the industry seeks to store the obtained facilities database online to allow for ease of update as well as reduce on the application upload in the application process. In addition, the product development process will rely on a qualified workforce with IT skills to enhance coding and programming of the software C++ language. As such, the development process will incur increased remuneration costs in order to reward and retain the respective employees in the development process. Qualified IT experts in the industry are rare. Consequently, the organisation will incur high costs in the market in rewarding such a workforce. Additionally, the organisations will incur additional marketing costs in a bid to enhance a market influence in the tourism industry. Currently, the product is a new venture that seeks to incorporate technology in tourism. As such, the organisation will be forced to increase the overall marketing strategies in the market in order to facilitate its market presence. Therefore, the product development process will incorporate new promotional and advertising strategies in the market. Thus, the product development and implementation strategy will incur costs in terms of infrastructure, human resources as well as the marketing costs (Surchi, 2011). A copy of this projected analysis in the product launch is reflected under the budget section. However, it is imperative to note at this stage that the product development and market penetration will earn revenues. In this case, it will have revenue streams on two fronts. On one hand, the tourism agency corporations will obtain annual utilisation of the application. As such, the organisations will be required to pay annual subscriptions in the market allowing for regular earnings. In addition, the featured organisations will be required to pay sustenance fees that will increase on the product features. Moreover, such an application will allow for increased advertising allowing for increased revenue streams earnings in the market. Therefore, as established under appendix 1, the product forecasted costs and revenues analysis establishes that the product venture is viable and profitable in the market. Additionally, the review establishes that the product is expected to obtain a breakeven in the next three years at the forecasted 40% profit margins. 3.2 Time As established in the cost analysis, the product is a new venture is a new business idea that lacks a market familiarity. As such, it is imperative for the product development process to conduct a marketing strategic approach in order to establish a market influence and presence. The TourApp targets to establish its influence starting with the Australian market towards other international markets. Therefore, the product will require a minimum two months period to establish its presence (Conley & Friedenwald-Fishman, 2006). In this period of time, the product will acquire increased infrastructure in the market such as a distribution and an appropriate supply chain. As such, the two months will provide the product development team with ample time to develop the infrastructure for efficient supply and influence in the tourism industry. Moreover, the product is expected to obtain a fast influence and penetration in the market. Based on the test analysis that registered a 90% satisfaction rate, the TourApp is expected to attain an increased product development and market reception in the market. Therefore, based on the statistical analysis, the product is expected to obtain a fast penetration in the market. 3.3 Risk In developing and establishing an increased market presence for the product, it is forecasted that the product will face a number of challenges in the market. On one hand, the product implementation process is expected to face challenges in creating market knowledge. As already discussed, the tourism industry is currently ignorant of technology application in the travel and tour guide in the market. Consequently, a situational analysis in the industry illustrates that the industry faces a shortage in technology infrastructure. The organisations lack appropriate technology infrastructure that serves as a platform for the application of the proposed product software. Therefore, the proposed software application will face a capacity challenge in the industry. In this case, the product team will be forced to implement a project to facilitate capacity building in the respective organisations. Thus, the product team will be required to implement a production process through educating the respective organisations on the merits of the proposed technology platform. In addition, the product development team will be forced to develop appropriate framework through which the respective organisations in the industry can adopt the require infrastructure to support the product development and implementation in the market. Additionally, the product implementation process will be faced with additional stakeholders’ ignorance. Convincing the respective featured organisations to pay loyalty fees as well as provide enough database information will be an expensive organisational venture in the industry (Karniel & Reich, 2011). Therefore, in order to overcome this risk, the product development team will be required to develop a training program through which the organisations will be educated on the potential benefits of the product application and implementation. Through the above recommendations, this product development plan argues that the product venture will attain increased market performance through overcoming the respective risks in the market. 3.4 Expected Benefits The application of this product in the tourism industry is expected to obtain increased earnings. Through the product venture, it is expected that the product will attain an increased market success and obtain an overall 40% of the consumer base on the travel and tour guide sector in the market. Through this venture, the TourApp venture is expected to obtain increased market profitability in the industry. As such, the organisation will obtain increased profitability levels that will facilitate increased returns in the industry (Drago, 1998). In addition, the adoption of the proposed product in the respective tourism agencies in the market will facilitate increased market competitiveness in the market through reduced costs of production in the market. Consequently, the industry will reduce on the overall market expenses on human resource. Instead the short term expenses in the short run will enhance long term benefits in the long run that will facilitate reduced expenses in the long run. Additionally, the product implementation process will facilitate increased industry efficiency in the market through reduced costs implications. Further, adoption of the product in the market will facilitate increased consumer cost reduction making the tourism industry relatively affordable. Consequently, this will reduce on the overall costs is the tourism resultantly increasing travel rates in the market. Therefore, the proposed product in the market will increase the overall market productivity both at the individual and industry levels. 4.0 Test Market Product development is a long process with variances stages that ought to be adhered and followed in order to facilitate the eventual development of a successful product. Yang, Moore, Wong, Jun-Sheng and Chong (2007) argued that product development lifecycle incorporate a range of phases including idea generation, design development, template production and testing. Among these stages, the study argued that testing allows for the acquiring of the market and potential consumers feedback. In developing a test study, a product template is distributed to a sample potential consumer base for evaluation. In this case, the respective organisations review the product performance against the estimated and theorisized traits in the market. The products actual performance and the estimated performance levels are evaluated and compared. The product testing approach serves as a benchmarking strategy that allows for the adoption of the continuous improvement process. Gallivan, Eynon and Rai (2003) argued that through the obtained product performance feedback in the potential market, organisations and product developers obtain an opportunity to review and benchmark the review against expectations. As such, the review allows for the adoption of a corrective strategy for product features that fail to meet the desired market output levels. Therefore, this incorporates and allows for the application of a continuous improvement application process. An additional merit of product testing is that the process allows for increased establishment of product revenues in the potential market. Based on this understanding, the tour guide application software was extended for testing in the Australian tourism industry. In its testing stage, the application targeted organisations offering tour guide for tourist touring the famous Australian beaches. In this case, the testing team selected a total of five organisations in the industry and requested for a pilot test of the product on their clients. As such, the testing crew started off the process by training the organizational staffs jointly at first and latter separately in their respective organisations. Then in conjunction with the trained organisational staffs, the selected a 30% sample of the respective organisations client base for the pilot testing. The clients were selected on a random sampling technique. Once selected, the team contacted them to inform them of the project and seek out their trave details. A majority, above 80% of the clients accepted to participate in the proposed program. The testing process lasted for a two months period. Upon each client tour, they were required to anonymously fill in query questionnaires on their perception and recommendations on the application system. Moreover, the staff collected views form the organisational management and staffs upon the elapse of two months period (Morrison, 2004). In summary, the testing established that the product has a market success potential as over 90% of the consumers registered satisfaction. However, a majority complained of the presence of a shallow database on facilities which was fundamentally price based. Therefore, in order to enhance the products increased performance on its launch, the consumers requested an expansion of the database both in quality and quantity. As such, the TourApp design team incorporated new aspects on facilities such as past consumers reviews on their services as well as ratings in the national statistics. Such changes enabled the product expand its data base allowing for increased information and use to the application. Conclusively, the product testing process can be termed as successful in the sense that it enabled improvements in the product design to promote its increased market acceptance rates that is expected to rise above the test 90%. 5.0 Launch The last stage in the new product development process is the launch process. A launch process is an involving process that involves availing the developed new products onto the market. Cooper and Edgett (2012) evaluated the role of product launch to the success of a new product development lifecycle. In the analysis, the authors established that a product launch played a significant role in facilitating eventual product success in the respective markets. Therefore, the study proposed that product launch should be a well crafted process to facilitate its eventual success in the market. Through this approach, products facilitate the development of an appropriate first impression in the market allowing for the development of a platform in which eventual market processes and consequential promotional and marketing strategies are developed. Based on this analysis, the new product launch is bound for launching for a period of three months. As Box and Platts (2005) argued, extended launch period will enable the product developers reach out to the respective industry stakeholders in the market. As such, the product launch team will engage in product promotional activities to create market awareness on the product in the Australian and the global markets. In its approach, the product seeks to adopt the rolling strategy. The adoption of this strategy will enable the product increase the overall market influence through increased market penetration in the market. In its operational approach, the product launch will focus on targeting influential stakeholders such as the role models in the tourism industry as well as use of bench markers in the industry. Through the use of these stakeholders, the product will attain an increased market presence with their increased influence on other consumers in the industry. Adopting this approach will serve the product an increased market success rates both in the short and long run. Through the rolling launch process, the organization will spread out its financial implications in the market. As such, this will enable and allow the product to raise increased market presence as well as fund out its activities. Through the launch period, the product is likely to create increased influence in the market. As such, the product launch process is likely to obtain increased sponsorship for its campaigns. The rolling launch process incorporates the inclusion of partners in the industry. The process will attract partners’ sponsorship who will be seeking an opportunity to jointly market their products and services in the market. Therefore, such sponsorship will raise enough funds for the product launch costs. In addition, through increased partnerships with the influencers as well as the industry partners, the product will attain an increased market influence. In order to perpetuate product acceptance and verification of its features and functionality, the proposed product launch will utilise the free samples marketing process. As such, it will offer free trial versions of the application with a three months lifespan to the respective travel guide agencies in the Australian and other random international markets. On its launch, the process expects to deliver on a number of key variables and aspects in the market. One is create a consumer influence and awareness of a minimum 30% of the target market in the Australian market. In addition, the product launch seeks to establish and identify potential industry partners with whom the new product can develop strategic alliances. In particular, the launch seeks to employ endorwements form personalities in the tourism industry. 6.0 Budget Total Costs Equipments 8,000 Human Workforce 6,500 Web Hosting 2300 Marketing Expenses 4,500 Total 21,300 21,300 Revenue Annual Subscriptions 9,000 Advertising Fees 3,000 Data Base presentation Costs 2200 Total 14,200 14,200 1st Year Revenues (7, 100) Expected Profit rise in First year=30% 18,460 Total Revenue 2nd year (2840) Expected revenue 3rd Year= 35% 24921 Total Earnings at the end of Third Year(Constant Costs) 3621 7.0 Conclusion In summary, this product development plan offers an evaluation of the development of new product tour guide application software. As such, the plan offers an industry analysis, product features, costs, risks as well as the launch plan. On one hand, an industry analysis establishes that the tourism industry is among the fastest growing industries in the global market. As such developing products targeting this industry serves as an ideal market venture on the global platform. However, the review establishes that the industry faces a challenge with respect to the utilisation of tour guides. As such, the review establishes that the challenge presents a market gap presenting an investment opportunity for the proposed product. Moreover, a study review on the product features establishes that the adoption of a unique approach offers the product a strategic unique selling point. In this case, the product applies the concept of technology use in travel and tour guide in its operations. In addition, the product develops unique alternatives as revenue streams. Among the developed revenue streams is the concept of annual subscriptions by the respective organisations using the application as well as advertisement fees for organisations advertising through the platform. As such, this analysis, establishes that the product is unique form others in the market such as Google maps. In addition a review on the product costs and revenues establishes that the product will attain a forecasted breakeven at three years form which profits are expected. However, the analysis establishes that the product roll out will face challenges on market ignorance and lack of capacity. Consequently, the product development plan intends to increase promotional activities as well as partners support to facilitate capacity building. Finally, the product development plan evaluates the proposed product test and launch program. On one hand, a test analysis establishes a 90% consumer satisfaction in the Australian market. In addition a launch plan seeks to adopt the rolling approach for a three months period through the use of free application trial versions. Based on the above new product development plan, this analysis establishes that the tour guide application software, dubbed TourApp will be a success and is expected to increase its market influence in the long run to other markets beyond the Australian economy. References Box, S., & Platts, K. (2005). Business process management: Establishing and maintaining project alignment. Business Process Management Journal, 11(4), 370-387 Conley, C., & Friedenwald-Fishman, E. (2006). Marketing that matters: 10 practices to profit your business and change the world. San Francisco, CA: Berrett-Koehler Publishers. Cooper, R. G., & Edgett, S. J. (2012). Best practices in the idea-to-launch process and its governance. Research Technology Management, 55(2), 43-54. de Beer, D., Booysen, G., Barnard, L., & Michèle Truscott. (2005). 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Journal of Vacation Marketing, 12(4), 371-379 Read More