Providing Innovative Solutions for the Worlds Problems OSU
CIBER Case Competition Andrea Steinbrenner Jan Kraaijeveld Caitlin
Parrett Ganesh Raj
Slide 2
2 Executive Summary Goal: Approach: Results: Gain market share
though US residential demand Generate funding for global expansion
Implement new technologies in developing countries Blah Target the
residential market to increase operating income Use innovation to
address global need of clean water Successfully launch RIMOS into
market to generate NPV of $2.4 MM Develop ClearAqua product to meet
demand for clean water and drive NPV of $10.1 MM Situation: Lack of
revenues from filtration segment Filtration business segment in
need of a successful product Global need for clean water
Slide 3
3 Situation Short Term Strategies Long Term Strategies Problem
ART is at a critical juncture Strengths ThreatsOpportunities
Challenges STRENGTHS Innovative culture Information Sharing
Autonomous decision making THREATS Lack of funding Business unit
termination Potential competitors OPPORTUNITIES First mover
advantage Partnership with internal units Increasing demand for
clean water initiatives CHALLENGES Credibility Low morale Slow
product life cycle
Slide 4
4 Situation Short Term Strategies Long Term Strategies Problem
After two product failures, ARTs filtration segment is desperately
in need of a successful product Product 1 Target Market: Capacity:
Flaw: Individuals without potable water 2,000 Liters/day Detectable
odor in end product Product 2 Target Market: Capacity: Flaw: NGOs
and Military Personnel 2,000 Liters/day Excessive battery usage $6
MM Annual Loss Source: Case Document
Slide 5
5 Situation Short Term Strategies Long Term Strategies Problem
The filtration segments next product, RIMOS, has made it to the
final stage of product development and is almost ready for beta
testing Product Development Product Testing Market
AnalysisPrototypeBusiness PlanBeta Batch Creation Problem
Identification Focus Group Analysis RIMOS Key Attributes Target
Market: Capacity: Cost: US Residential Homeowners 10,000 square
feet $2,000 Retail Price $1,000 Wholesale Price Value Proposition:
Reduces water usage while still giving lawns the care they deserve
Source: Case Document RIMOS Development Lifecycle
Slide 6
6 Initiatives Introduce RIMOS Introduce ClearAqua
Slide 7
7 Situation Short Term Strategies Long Term Strategies Problem
In order to prove that the filtration unit can be profitable, ART
should fast-track the RIMOS system Reasons for Fast-Tracking Rapid
market growth Reduced R&D costs from utilization of an existing
technology Strong managerial confidence
Slide 8
8 Situation Short Term Strategies Long Term Strategies Problem
The housing market is growing rapidly, indicating that there will
be strong demand for the RIMOS system Increase in home construction
increases demand for RIMOS Average household uses 320 gallons of
water daily Source: US Census Department
Slide 9
9 Situation Short Term Strategies Long Term Strategies Problem
ART can offer consumers a strong value proposition and excellent
distribution channels Value Proposition Integrated into new homes
Environmentally Friendly Cost Savings Distribution Channels Home
Depot Lowes Home Manufacturers
Slide 10
10 Situation Short Term Strategies Long Term Strategies Problem
ART can leverage its partnerships with distributors, as well as
internal corporate synergies, to distribute RIMOS Future objectives
Explore harvesting to use RIMOS technology in commercial
applications Logistics External partnerships with contractors and
retailers Internal synergy with HVAC and other segments Initial
goals Attain sales of $5.45M in the first year Price point of
$1,000 per unit Source: Case Document
Slide 11
11 Situation Short Term Strategies Long Term Strategies Problem
By introducing RIMOS, the filtration unit can realize up to $2.4MM
in profit 200620072008200920102011 Operating Cash Flow (thousands)
($2,000.0)$545.0$1,062.0$1,772.0$2,178.0$2,614.0 Discount
rate1.21.21.21.2 4 1.2 5 Cumulative
NPV($2,000.0)($1,545.83)($808,33)$217.13$1,267.48$2,317.99 Source:
Case Document
13 Situation Short Term Strategies Long Term Strategies Problem
Access to clean drinking water is a global problem Source: UN
Millennium Development Goals Update Global Water Access Need:
Availability: Spending: 1.1 Billion do not have access to clean
water Low, especially in 3 rd world countries Increasing, driven by
NGOs
Slide 14
14 Situation Short Term Strategies Long Term Strategies Problem
ClearAqua can have a positive impact on ART both internally and
externally Positive impact on people, development, organizations
and society Integrative effect on inter-team communication within
ART Diversifying effect on ARTs product portfolio We aim to change
the world through innovation and to grow our place in it through
entrepreneurship. ClearAqua has a
Slide 15
15 Situation Short Term Strategies Long Term Strategies Problem
ART can introduce a new mini oxidation water filter called
ClearAqua to increase water availability and drive growth
SizeAvailabilityCost Key Success Factors Product Development
Product Testing Market AnalysisPrototypeBusiness PlanBeta Batch
Creation Problem Identification Focus Group Analysis
Slide 16
16 Situation Short Term Strategies Long Term Strategies Problem
Introducing ClearAqua matches well with ARTs corporate goals Social
Responsibility Employee Satisfaction Innovation ClearAqua Promotes
Company Goals We aim to change the world through innovation We were
so excited by that decision[to continue the project] Innovation and
entrepreneurship are the twin engines driving this company
Slide 17
17 Situation Short Term Strategies Long Term Strategies Problem
ClearAqua can also be a growth driver for the filtration unit
Yearly Estimated Cost of MDG for Water $ 21,000,000,000.00
Estimated Percent of MDG Grant0.10% 20072008200920102011 Revenue $
21,000,000.00 Operating Margin10%15%20% Operating Income $
2,100,000.00 $ 3,150,000.00 $ 4,200,000.00 Discount Rate20%
NPV$10,081,404.32 Sensitivity Analysis Source: World Bank, MDG
Assessment Net Present Value ($Millions) Percent of MDG for Water
Funds
Slide 18
18 Executive Summary Goal: Approach: Results: Gain market share
though US residential demand Generate funding for global expansion
Implement new technologies in developing countries Blah Target the
residential market to increase operating income Use innovation to
address global need of clean water Successfully launch RIMOS into
market to generate NPV of $2.4 MM Develop ClearAqua product to meet
demand for clean water and drive NPV of $10.1MM Situation: Lack of
revenues from Filtration segment Filtration business segment in
need of a successful product Global need for clean water
Slide 19
19 QUESTIONS?
Slide 20
20 Our Team Jan Kraaijeveld Erasmus University International
Business Administration Likes long walks on the beach and man
purses Caitlin Parrett Michigan State University 11 Marketing Can
iron a mean shirt Andrea Steinbrenner San Diego State University 11
Accounting Mega bytes are bigger than kilo bytes! Ganesh Raj
University of North Carolina 12 Economics, minor in Mathematical
Decision Sciences Likes Diet Coke and not telling jokes
Slide 21
21 Appendix 1: Corporate value chain Firm infrastructure:
Autonomous decision making; holistic sharing of ideas, expertise,
and knowledge Human resource management: Taking advantage of global
talent by setting up departments abroad, according to the
congregation of skilled employees Technology development:
Developing new solutions by investigating and refining the latest
trends such as ultrasound wave technology Procurement: Utilizing
corporate resources and ARTs image to secure stable and reliable
suppliers in order to meet production needs Marketing & Sales:
Catering to the needs of the residential market by focsuing on cost
leadership and sustainability Inbound logistics: Securing contracts
with suppliers to ensure timely delivery of raw materials
Operations: Enforce deadlines and keep a strong focus on quality
control and economies of scale Outbound logistics: Ensuring timely
delivery of products and information to clients by focusing on
robust logistics Service: Providing excellent pre- and after sale
support by having qualified engineers available to customers
Slide 22
22 Appendix 2: U.S. Water Industry Revenue Source: Case
Document
Slide 23
23 Appendix 3: Daily Water Use in the Average US Household
