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Cascade Microtech Enters New Market

Cascade Microtech Enters New Market

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Capstone Presentation Capstone Presentation Presentation Transcript

  • Case Study: Neptune Project Cascade Microtech Applies its Measurement Technology to a New Market Resulting in Discontinuous Innovation EMGT 590 Synthesis Portland State University Diana Laboy-Rush
  • Agenda
    • Introduction
    • Methodology
    • Case Study Findings
    • Recommendations
    • Lesson & learn
    • Discussions and Questions
  • Introduction
    • Purpose: To analyze real world project to apply strategic management principles
    • Why Cascade Microtech?
      • This project represents a significant organizational effort in business growth.
    • Case Study Subjects
      • Product Marketing Manager
      • Life Sciences Sales Manager
      • Advanced Development Manager
      • Director of Marketing
      • Director of Advanced Development
  • Methodology
    • Grounded theory
      • Case study method
      • Interview approach
    • Steps of applying grounded theory
      • Getting started
      • Selecting the case study
      • Crafting instruments and protocols
      • Entering the field
      • Analyzing within-case data
      • Searching for cross case pattern
      • Enfolding the literatures
  • Case Study Findings
      • Project Description
      • Project Characteristics
      • Business and Opportunity Analysis
      • Success Measures
      • Marketing Strategy / Implementation of Project
      • Project Organization
      • Tools
      • Pre Project Learning
      • Success factors
      • Major problems
  • Project Description and Characteristics
    • Product Description and History
    • Project Motivation
    • Product Vision and Definition
  • Project Description
    • The project goal is Cascade wants to expand core business to the new market.
    • Current market
      • Semiconductor wafers
      • Printed circuit boards
      • Micro electro-mechanical system (MEMS)
    • New Market
      • Life Science
        • Micro-fluidics technology
  • Project Motivation
    • Raising company revenue $1 Million this year
    • Attacking their competitor’s positions in new market
    • Rapid product development process
    • This project will be a key for cascade to open the new market
  • Product Vision and Definition
    • Product vision and definition was unclear in the initial stage. Right now, they’re clear, but not complete with the long term vision.
    • Process to find out product vision and definition
      • Correct the information (Talking to experts)
      • Study about this technology by attending workshops, seminars and studying text books and articles
      • Gathering customer needs and customer feed backs
    • BETA product will help Cascade to clarify the product vision and definition
  • Business and Opportunity Analysis
    • 3 main areas for analyzing the business opportunity
    • Customer need
    • Technology
    • Market size
  • Business and Opportunity Analysis Results Source: Cascade Microtech, 2005 MEMS Microfluidics Drug discovery Point of care Diagnostics Ink jet Environmental Unarmed aerial vehicles Microarray / Microdispensers Micro-thermal & micro-propulsion Clinical diagnostics Currently, life science applications represent about 10 - 15% of the microfluidics market, growing to 50% in 2008. Fuel cells BioMEMS Ecology
  • Project Phases Planning Phase Objective: Feasibility & target ROI, Market Requirement (MRS) Concept Phase Objectives: Product Specifications, Marketing Playbook Prototype Phase Objectives: Prototype Units Beta Phase Objective: Customer Validation and Testimonials Release Phase Objective: Sales, Profit, Credibility in Life Sciences Advanced Development Engineering Marketing Sales Jan 04 Mar 04 May 04 July 05 Aug 05 Source: Cascade Microtech, 2005
  • Project Organization
    • Managing in a New Market
    • Advanced Development Group
      • History of project stemmed from this group
      • “…chartered with looking at long range new business opportunities, technology opportunities.”
  • Success Measures
    • Metrics for Success
    • Risk Factors
  • Metrics of Success
    • Brand Equity in new market
    • Grow Business
      • Revenue of $1 Million within 6 months
    • Rapid Product Development Process
    • Credibility in new market
    • Open door to new customer base
    • Sales, Profit, etc.
    Marketing Advanced Development
  • Risk Factors Unknown Market Characteristics Unknown Technology High Switching Costs Low Barrier to Entry Wrong Target Market Wrong Feature Set Manufacturing Process Marketing Advanced Development
  • Marketing Strategy and Implementation of the project
    • Customer value proposition
    • Competition and current offerings
    • Response expected from launch
    • Weakness of the product
    • Incorporating Customer Needs
  • Customer Value Proposition
    • COMMUNICATION
    • External Communication
      • Understanding the Customer Needs & Problems
    • Internal Communication
      • Between Departments of the Company
  • Competition & Current Offerings
    • No Similar Product in the Market
    • Substitute Systems are More Expensive
    • Discontinuous Innovation
    • (Breakthrough Technology)
    • Integrated Solution
    • Current Offerings Destructive and Inflexible
  • Response Expected From Launch
    • Optimistic Outlook
      • Hot Topic of the Year (A lot of Interest)
      • Converging Semiconductor Technology & Biological Application
    • Another Perspective (Success)
      • Strategic Partnerships
    • Conscious Perspective
      • From “Not too much” to “A whole lot”
  • Weakness of the Product
    • New Product to an Emerging Market
    • Product will offer one-way solution
    • Company is inexperienced in the market
    • Doesn’t perform any electrical measurements
  • Incorporating Customer Needs
    • No new versions of product for six months
    • Every customer is going to get follow up
    • Beta Customer Feedbacks
    • No Microfluidics Application Engineer
  • Tools Trade shows, online information, online newsletter, blog…. Release Beta-site Beta W ebinar Prototype MRS template, marketing playbook Concept Bass Diffusion Model , Researches Planning Approach Project Phase
  • Example – Bass Diffusion Model Source: Cascade Microtech, 2005
    • Bass Diffusion Assumptions
    • Industry socket count 700
    • Academic socket count 400
    • Institute socket count 200
    • Government socket count 100
    • ASP $100K
    • Only based prober solution based
    • 100% new market penetration
  • MRS Components
    • Project Background: This included sections on the project objectives and product needs.
    • Primary Customer / Market Needs: This includes definition of the target customer and the specific market needs.
    • Market Characteristics: This section outlines the market segments and competition for the product.
    • Product Specifications: This section defines specific product requirements, certification requirements, product packaging, and pricing.
    • Product Timing: This includes market sizing data and product forecasting.
  • Pre Project Learning
    • New Learning
      • Learn from mistakes
      • New market knowledge
      • Learn from competitors
    • Documentation and sharing
      • MRS
      • Playbook
      • Meeting Minutes
      • Trip Report
  • Success Factors
    • It is impossible to know what are the success factors at this time.
      • Providing the right product – setting the beta site
      • Tools– forecasting and searching
      • Effective cross functional team– right people in the right positions
      • Promotion strategies– Trade show, online, direct mail, newsletter
      • Finding the right partner –sale channel
  • Major Problems
    • Major problem
      • Finding the right sale channel
      • Technical problem
    • Major change
      • A lot of changes
      • Entering the new market and compress project schedule
  • Recommendations
    • Exit Strategy
    • Niche Market Strategy
    • Strong sales channel
  • Lessons Learned - 1
    • Clear Product Definition is not necessary at project initiation
    • 3 main project motivations
      • Grow the business
      • Attacking competitors
      • Improve internal processes
    • Business opportunity analyzed in three areas
      • Customer needs
      • Market analysis
      • Technology analysis
  • Lessons Learned - 2
    • Rapid Product Development blurs the transition of project phases (concurrent engineering)
    • Biggest risk factor = unknowns
    • Strategic partnerships critical for discontinuous innovation
    • Customer Value Proposition is the value of the solution from the customer's perspective.
    • Discussions and Questions