DSO 580Le Petit Chef

Boustani, NatalieDaryan, Behrad Sami

Gallais, AmauryMotamedi, Nina

Sundstrom, Magna

Agenda

• Le Petit Chef and its environment

• Problems facing Le Petit Chef

• Recommendations• Implementation plan• Risks

Le Petit ChefFrench kitchen countertop appliances companyFounded in 1989 with a mission to “take the art of French microwave cooking to new levels.”Target markets: France and Western EuropeMicrowaves represent 61% of their sales and account for 85% of their revenues.600+ employees• 35 engineers of the 30 engineers work on

microwavesOrganizationAggressive advertising and promotion campaigns

Competitive Environment

Diversified, global players: Sharp, Samsung, Whirlpool, GE, Electrolux and Bosch-Siemens• Global players leveraged economies of scale and scope• Successfully penetrated the low-end and mid-range

segments of the European microwave oven market.Smaller regional players: Merloni, Moulinex and Le Petit Chef• Manufacture appliances customized to local tastes and

preferences• Targeting the less price sensitive high-end marketLe Petit Chef products were differentiated through their emphasis on technical innovation and performance features.Overall microwave prices declining at over 10% annually between 1996 and 2000

Problems facing Le Petit Chef• Problem 1: Decline in Margin

• Increased operating costs • Market share and price drop

• Problem 2: Project Delays• Non-standardized products• Labor = scarce resource• Too many simultaneous projects

• Problem 3: Misalignment of NPD and business strategy• No more meetings• Using NPV

Recommendations

Ongoing Projects

• Aesthetic Differentiation

• Change Grill Element Material

• Redesign the Egalite user interface

Proposed Projects

• Develop Quick-Heating Model

• Add a Large Cavity to the Liberte line

Desired Outcome:

• Modular Design/Manufacturing

• Product Differentiation/Marketing

• Focused Strategy/R&D

• In line with High Quality LPC Standards & High Performance Target Market

• Manageable resource allocation, delay Reduction

• Stay Competitive & Profitable

Ongoing ProjectsDecision Matrix

    Marketing R&D Manufacturing

Project DescriptionEst Ship

Date (months

from now)

NPV/ #Resources

Required /Month

Price & Visible feature

Differentiation

Enhance Performance

& QualityModularize Design

Redesign the Egalité user interface 6 761,111 Yes No ?

Aesthetic Differentiation 5 640,000 Yes No No

Change Grill 3 583,333 No Yes Yes

Redesign Wave-Guide 6 250,000 No Yes Yes

Add Halogen Lamp 18 208,333 No Yes NoModify HV Power Supply

design 9 138,889 No Yes YesReconfigure Component

Layout 12 166,667 Yes No No

Proposed ProjectsDecision Matrix

    Marketing R&D Manufacturing

Project DescriptionTime to

completion(months)

NPV/ #Resources

Required /Month

Price & Visible feature

Differentiation

Enhance Performance

& QualityModularize

Design

Liberte Express 6 645,833 Yes Yes No

Larger Cavity Liberté line 6 480,000 Yes No No

Low-end Fraternité line (Cost Reduction) 12 277,778 Yes No No

Low-end Fraternité line (New Design) 18 55,556 Yes No Yes

Fuzzy Logic 18 22,876 No Yes Yes

Implementation Plan

Step I•Decide how the project will be terminated

Step II

•Assign a Termination Manager

Step III

•Plan, Budget, Schedule•Similar to starting a project•Sensitivities to redistribution of personnel•Morale considerations

Implementation Plan

Resource: https://info.undp.org/global/popp/ppm/pages/Closing-a-Project.aspx

Implementation Plan

Immediate Implementation:

Termination by Murder• Halogen Lamp

Next Steps in ImplementationTermination by Extinction • HV Power SupplyTermination by Integration• Component Layout → Larger

Cavity Model• Redesign Wave Guide →

Quick Heating Model

Risks (I)Potential

Risk Description Risk Management Plan

Changes in the

technology

There is a risk to keep up with the market trend. Specifically, the Asian consumer electronics manufacturers targeted the

high-end market using new technologies such as sophisticated “fuzzy logic”.

R&D leaders should allocate few engineers to develop new intelligent line of microwave

cooking appliances.

Change in the

product development strategy

R&D leaders might decide to enter the low-end market. Due to the Company’s lack of experience and brand awareness in this

sector, this might hurt the company’s revenue.

The Company should do due diligence on the low-end market

dynamics and only enter the market with a low budget

product.

Supplier and

sourcingThere are a few global suppliers providing

two key parts to the Company. They should use dual-sourcing

strategy for these parts.

Risks (II)Potential

Risk Description Risk Management Plan

Cost There is a price point pressure from the large global CE manufacturers in Europe.

The Company can use modular designs and continuous process

improvement techniques to compete in the market.

Management

With the new R&D director, there is a risk that she cannot adapt with the Company’s

culture and the business processes already in place.

There should be several meeting between the top executive people and the Directors to make sure that everybody is

aware of the Company’s priorities.

Key personal

leave

Due the amount of on-going projects and the limited resources in the R&D department,

there is a risk that the key senior engineers become burnout and leave the Company.

There should be periodic meetings between the top level

people and the Directors to make sure each department's

team morale is in a good shape.

Questions