logging in or signing up Experience Curve 02 06 01 Connor Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINTLite Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: (To copy code, click on the text box) Embed: URL: Thumbnail: WordPress Embed Customize Embed The presentation is successfully added In Your Favorites. Views: 2849 Category: Education License: All Rights Reserved Like it (0) Dislike it (0) Added: February 24, 2008 This Presentation is Public Favorites: 1 Presentation Description No description available. Comments Posting comment... Premium member Presentation Transcript The Economic Context for Strategy: The Economic Context for Strategy PRODUCT LIFE-CYCLE: PRODUCT LIFE-CYCLE Sales Volume Over Time: Sales Volume Over Time Time Sales Embryonic Growth Mature Decline Profits Continued Growth: Continued Growth Time Sales Embryonic Growth Mature Decline RejuvinationThe Product Life Cycle: The Product Life CycleVariations on Business Life Cycle: Variations on Business Life Cycle $ $ $ $ Market Segments in Business Life Cycle: Market Segments in Business Life Cycle $ Composite PLC Time M10 M10 M20 M20 M30 M30 M40Products in Business Life Cycle --Warner-Lambert Company: Products in Business Life Cycle --Warner-Lambert Company Dispos- able razor Easprin E.P.T. Plus Bubblicious Angiocath II Listerine Surgical Gloves Norlestrine Bromo-Seltzer 1 2 3 4 5 6 7 8 9EXPERIENCE CURVE: EXPERIENCE CURVE Experience Curve: Experience Curve Based on observations of cost of manufacturing aircraft. For every doubling in volume produced, X% of cost was reduced. Ct = C0 (Pt /P0)-a Where Ct is cost at time t Pt is production volume at time t. a is an industry constantExperience Curve: Experience Curve Cost Accumulated Volume Experience Curve: Experience Curve Cost Accumulated Volume 1 10 100 1000 $1.00 $0.50 $10.00 $30.00 Log-LogExperience Curve Examples: Experience Curve ExamplesExperience Curve: Experience Curve Cost Accumulated Volume (millions of units) 1 10 100 1000 $1.00 $0.50 $10.00 $30.00 Integrated Circuits 1964-74 70% SlopeExperience Curve: Experience Curve Cost Accumulated Volume (millions of units) 1 10 100 1000 $400 $200 $800 $1000 3-ton Split System Air Conditioners 1957-74 80% SlopeINTEL #2716--A 16K EPROM: INTEL #2716--A 16K EPROM Price 1-79 1-80 1-79 1-80 Cost 1-81 3-81 Cumulative Experience Price Index Cost Index (on different scales)Cost Experience for Steam Turbine Generators: Cost Experience for Steam Turbine Generators COST/ Megawatt Steam Turbine Generators Log Industry Cumulative Megawatts of Generators Delivered 70% slope 200 MW units 400 MW units 600 MW units 87% slopePrice Experience Curves for Japanese Motorcycles (1959 to 1974): Price Experience Curves for Japanese Motorcycles (1959 to 1974) Average Price ( 000 1965) Cumulative Volume (million units) 1 10 100 80 60 40 20 Slope 76% 126-250 cc 51-125 cc <50 cc Slope 81% Slope 88%Slide21: Photovoltaic modules, 1976-1992 (William and Terzian 1993).Experience Curve Components: Experience Curve ComponentsExperience Curve Components: Experience Curve Components Learning Specialization of Labor Product & Process Improvements Methods & Systems Rationalizations Economies of Scale Know-HowGROWTH/SHARE MATRIX: GROWTH/SHARE MATRIX Product Life Cycle Meets the Experience CurveBCG Growth/Share Matrix: BCG Growth/Share Matrix Relative Market Share Relative Market Growth Low High Problem Child High Rising Star Low Cash Cow DogBCG Growth/Share Matrix: BCG Growth/Share Matrix Relative Market Share Relative Market Growth High High Low Low Problem Child (Top Executive Version)BCG Growth/Share Matrix Development Path: BCG Growth/Share Matrix Development Path Relative Market Share Relative Market Growth High High Low Low Rising Star Problem Child Cash Cow DogBCG Growth/Share Matrix Cash Flow: BCG Growth/Share Matrix Cash Flow Relative Market Share Relative Market Growth High High Low Low Rising Star Problem Child Cash Cow Dog $ $ $ $ $ $ $BCG Matrix: BCG Matrix Mark IIBCG Matrix II: BCG Matrix II Number of Approaches to Achieve Advantage Size of the Advantage Many Small Fragmented Few Stalemate Large Specialization VolumeBCG Matrix II: BCG Matrix II Number of Approaches to Achieve Advantage Size of the Advantage Many Small Fragmented Few Stalemate Large Specialization VolumeIndustry Value Chain: Industry Value Chain Manufacturing Product and service flow R & D Engineering Production & Manufacturing Marketing Sales & Distribution Service Disposal Administrative & other Indirect Value AddedThe Experience Curve & The Value Chain: The Experience Curve & The Value Chain R & D Production & Manufacturing Subassembly Marketing Sales & Distribution Retailing 95% 75% 70% 90% 85% 95%Slide36: THE END THE END You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.
Experience Curve 02 06 01 Connor Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINTLite Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: (To copy code, click on the text box) Embed: URL: Thumbnail: WordPress Embed Customize Embed The presentation is successfully added In Your Favorites. Views: 2849 Category: Education License: All Rights Reserved Like it (0) Dislike it (0) Added: February 24, 2008 This Presentation is Public Favorites: 1 Presentation Description No description available. Comments Posting comment... Premium member Presentation Transcript The Economic Context for Strategy: The Economic Context for Strategy PRODUCT LIFE-CYCLE: PRODUCT LIFE-CYCLE Sales Volume Over Time: Sales Volume Over Time Time Sales Embryonic Growth Mature Decline Profits Continued Growth: Continued Growth Time Sales Embryonic Growth Mature Decline RejuvinationThe Product Life Cycle: The Product Life CycleVariations on Business Life Cycle: Variations on Business Life Cycle $ $ $ $ Market Segments in Business Life Cycle: Market Segments in Business Life Cycle $ Composite PLC Time M10 M10 M20 M20 M30 M30 M40Products in Business Life Cycle --Warner-Lambert Company: Products in Business Life Cycle --Warner-Lambert Company Dispos- able razor Easprin E.P.T. Plus Bubblicious Angiocath II Listerine Surgical Gloves Norlestrine Bromo-Seltzer 1 2 3 4 5 6 7 8 9EXPERIENCE CURVE: EXPERIENCE CURVE Experience Curve: Experience Curve Based on observations of cost of manufacturing aircraft. For every doubling in volume produced, X% of cost was reduced. Ct = C0 (Pt /P0)-a Where Ct is cost at time t Pt is production volume at time t. a is an industry constantExperience Curve: Experience Curve Cost Accumulated Volume Experience Curve: Experience Curve Cost Accumulated Volume 1 10 100 1000 $1.00 $0.50 $10.00 $30.00 Log-LogExperience Curve Examples: Experience Curve ExamplesExperience Curve: Experience Curve Cost Accumulated Volume (millions of units) 1 10 100 1000 $1.00 $0.50 $10.00 $30.00 Integrated Circuits 1964-74 70% SlopeExperience Curve: Experience Curve Cost Accumulated Volume (millions of units) 1 10 100 1000 $400 $200 $800 $1000 3-ton Split System Air Conditioners 1957-74 80% SlopeINTEL #2716--A 16K EPROM: INTEL #2716--A 16K EPROM Price 1-79 1-80 1-79 1-80 Cost 1-81 3-81 Cumulative Experience Price Index Cost Index (on different scales)Cost Experience for Steam Turbine Generators: Cost Experience for Steam Turbine Generators COST/ Megawatt Steam Turbine Generators Log Industry Cumulative Megawatts of Generators Delivered 70% slope 200 MW units 400 MW units 600 MW units 87% slopePrice Experience Curves for Japanese Motorcycles (1959 to 1974): Price Experience Curves for Japanese Motorcycles (1959 to 1974) Average Price ( 000 1965) Cumulative Volume (million units) 1 10 100 80 60 40 20 Slope 76% 126-250 cc 51-125 cc <50 cc Slope 81% Slope 88%Slide21: Photovoltaic modules, 1976-1992 (William and Terzian 1993).Experience Curve Components: Experience Curve ComponentsExperience Curve Components: Experience Curve Components Learning Specialization of Labor Product & Process Improvements Methods & Systems Rationalizations Economies of Scale Know-HowGROWTH/SHARE MATRIX: GROWTH/SHARE MATRIX Product Life Cycle Meets the Experience CurveBCG Growth/Share Matrix: BCG Growth/Share Matrix Relative Market Share Relative Market Growth Low High Problem Child High Rising Star Low Cash Cow DogBCG Growth/Share Matrix: BCG Growth/Share Matrix Relative Market Share Relative Market Growth High High Low Low Problem Child (Top Executive Version)BCG Growth/Share Matrix Development Path: BCG Growth/Share Matrix Development Path Relative Market Share Relative Market Growth High High Low Low Rising Star Problem Child Cash Cow DogBCG Growth/Share Matrix Cash Flow: BCG Growth/Share Matrix Cash Flow Relative Market Share Relative Market Growth High High Low Low Rising Star Problem Child Cash Cow Dog $ $ $ $ $ $ $BCG Matrix: BCG Matrix Mark IIBCG Matrix II: BCG Matrix II Number of Approaches to Achieve Advantage Size of the Advantage Many Small Fragmented Few Stalemate Large Specialization VolumeBCG Matrix II: BCG Matrix II Number of Approaches to Achieve Advantage Size of the Advantage Many Small Fragmented Few Stalemate Large Specialization VolumeIndustry Value Chain: Industry Value Chain Manufacturing Product and service flow R & D Engineering Production & Manufacturing Marketing Sales & Distribution Service Disposal Administrative & other Indirect Value AddedThe Experience Curve & The Value Chain: The Experience Curve & The Value Chain R & D Production & Manufacturing Subassembly Marketing Sales & Distribution Retailing 95% 75% 70% 90% 85% 95%Slide36: THE END THE END