Page 38 - DMGT501_OPERATIONS_MANAGEMENT

Operations Management

Notes Stage 3: Maturity Stage

The third stage or the maturity stage sees the product as an established product and the demand
and quality of the product does not undergo much change. However, this is the stage of cut-
throat competition, with competitors competing on the basis of providing value to the product.

Stage 4

In this stage, new product categories are introduced into the market that provide better value to
the consumer for that particular need or there is a change in the needs of the consumer.
Figure 2.1: Product Lifecycle

A number of factors impact the product category when it is introduced. Factors that impact the
introduction stage of consumer products positively are:
1. Relative Advantage
2. Compatibility (values and experience of adopters)

3. Divisibility (ability to try on a limited basis)
4. Communicability, i.e., ability to describe advantages.
Factors that impinge negatively are:
1. Complexity

2. Perceived Risk
In the case of industrial products, though the principles involved are similar, the mechanism by
which it works is different. It has been found that the rate of diffusion in industrial markets,
during the 'introduction stage', is related to the competitive intensity of the supplier industry,
the reputation of the supplier industry, and the vertical co-ordination between supplier and
adopter industries.

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