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PVT Case Submission

PVT Case

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13 views2 pages

PVT Case Submission

PVT Case

Uploaded by

dibya7184
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Dibyajyoti Barik.

PGP/27/021
Q1- What could be the reasons for the unfavorable evaluation of PV technologies by Greg
Morgan?

PV Technologies is a global leader in the PV inverter industry. They invest significantly in


research and development and technology to ensure top-notch quality, innovation, and
superior performance. However, this results in higher costs.

• PVT is very confident in their service, product performance, and superior product delivery,
but their bid prices are higher compared to their competitors.

• Solenergy has different expectations from their vendors. They aim to cut costs even if it
means increased operational expenses but want lower net ownership costs. Although PVT
offers the best performance and quality in the market, their bid prices are high. Solenergy is
willing to accept slightly lower product quality because they trust their own quality control
systems.

Q2- Evaluate alternative course of action available to PVT to gain favorable evaluation by
Solenergy for the Barstow Project?

Extend product warranty to 20 years:

• PVT offers a better warranty than competitors, who provide a 5-year warranty (a significant
value addition for Solenergy).

Offering a 20-year warranty would result in extra costs for PVT (increased expenses for PVT).

• Solenergy is not worried about the quality of PVT's products but is focused on price and
ownership costs, which stay unchanged.

99% uptime guarantee for each inverter:

• Provide edge over competitor, because competitor cannot promise this because of inferior
products.

• Cost incurred in warranty services may offset profits made from the deal, and it would
compromise future negotiations with Solenergy.

• Differentiated product service, but comes at the cost of risk of losing the profits made out of the
profits. It would impact future business negotiations with Solenergy.

Provide next generation 1.25MW product:


• The most efficient and reliable inverter in the market.
◦ Morgan would be impressed by the cutting-edge technology, but there's a potential risk of
malfunction due to compromised testing.
◦ Instead of launching in April 2012, this new inverter can be introduced in January 2012,
targeting large users.
◦ During a time of cost-cutting approaches, it would be better to combine smaller inverters,
which would be more cost-effective than introducing a new, larger inverter.
Dibyajyoti Barik.
PGP/27/021
Morgan has two main concerns: the risk of malfunction and the focus on cost-cutting. Even
with the latest technology, these concerns about cost reduction and capital expenses for
Solenergy remain unresolved.

Approach Morgan directly before deciding anything: As source of information is unknown


and also the concerns are over bid prices, and cost of capital. Talking directly to Morgan should
be the next step, because in other alternatives, either profit or company image is getting
compromised.

Q3- What short term and long-term policies and processes should PVT develop and
implement to effectively improve its marketing programs?

• Flexibility in Features: Not all businesses need high-end products. Many are willing to cut
costs. PVT should offer flexibility in their product features and quality to accommodate this.
• Low Basic Cost for Entry Models (Lock-in Strategy): PVT should introduce a basic model
that can be customized to meet various business needs. This approach would attract a diverse
range of businesses, with some requiring more features and others less.
• Expanded Product Portfolio with Diverse Pricing and Quality: PVT should offer products
with different capacities and efficiencies. This would help them capture more market
segments and provide greater flexibility.
• Long Tail Marketing Approach: Offering numerous customization options to increase
revenue. Customers would start with core models and then be attracted by customizable
features, helping to retain those focused on cost-cutting.

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