Analyze the Opportunity at Elite Electronics Vignette in Chapter 5. Discuss whether Elite should grab the new ADC and run for the pot of gold or play it safe and wait for more proven technology and competitive sources. Consider the advantages of being first to market compared with waiting for someone else to sustain the costs of working out the issues. (Hint: Develop an expected value analysis of the two alternatives).
I think that given the details in the case study in chapter 5 (Burt, Petcavage, Pinkerton, & Burt, 2010), Elite Electronics should hold its horses and wait for more proven technology and competitive sources. The other alternative described in the question is to be first in the market but I don’t agree to it as I think that the resources and the outcomes provided in the case study point to the fact that grabbing the pot of gold would not be a good idea. In the following discussion I would like to do a value analysis of the two alternatives.
First let’s take the alternative of going after the gold pot. There is a 40% chance that things may not go well. This is a high percentage in my opinion. The case study does state that there would be a sale of 10000 products for the new device but that is an expected case if the production processes are completely successful. So I guess it’s not worth the risk.
On the other hand if take the example of waiting for more proven technology, there is a chance that there would be a different more reliable and cheaper alternative. It is definitely possible that othes would sustain the cost of the working out the issues that could not be financially feasible for Elite Electronics. This is why I think that this alternative is best suited to the current circumstances.