dc.description.abstract | An impact of the global financial crisis in 2008 to the consumer electronics market is a sharp downturn in consumer buying power, resulting in weak global products demand. This in turn resulted in a saturated market for portable navigation devices, Forcing major navigation equipment suppliers to expand into new markets, in search of new sources of revenue.
In the mean time, the target of this case study, Company M acquired two global leading navigation software developers to strengthen its content offerings. Since then, it has gone through various organizational adjustments among different business units. However, due to differences in corporate cultures, ideas, mentalities and work process in these three companies, integration of resources have not been smooth. This results in lengthy developing cycles, wastes in resources, and excessive intangible costs, tardy new products launches, and missed market opportunities.
The “software” discussed in this study is embedded software, which are integral parts of hardware products. In project management, R & D integration, value generation and product development, most companies treated performance of these software teams from a hardware perspective, for example: materials management, costs of development and manufacturing processes. The importance of the software is often neglected. The true value of software is often under-appreciated with the “hardware mentality.” In addition, performances of software personnel are evaluated inappropriately, resulting in low morale and low software quality.
Based on the software pricing, internal competition, and organizational changes perspectives, this study investigated the problems of inadequacy in evaluating software value during its development. This study proposes a three stage process, introducing a market mechanism, from virtual pricing to a charge back mechanism based on the actual needs. Therefore, project costs can be accessed and targets for profit and loss can be controlled. Furthermore, internal competition can be introduced to enhance motivation and fair incentives. In addition, organization adjustments have to be carried out along the same line, to fit the proposed processes.
In addition to eliminate unnecessary costs, the proposal is expected to improve overall effectiveness, and increase its competitiveness. | en_US |