Callaway Golf Canada

C entirelyaway golf game Canada The Mobile Performance Team Case Study Jamie Merrimen 100117777 October 12, 2012 business sector 1703 D1 Dr. Conor Vibert Problem Statement Wayne M eitherette is the director of performance management for Callaway golf game Canada, the worlds largest golf nightspot manufacturer. In 2004, Mallette launched the Mobile Performance Team (MPT), a team of 20 pertainants who demonstrate the Callaway equipment line as well as measuring customers for custom equipment at private golf courses during the golf season.Mallette has been asked by Callaway Canadas managing director to design a plan for the approaching 2008 golf season to make sure that Callaway Canada provide stay forrader of its competitors. Mallette is faced with multiple choices for possible alterment, or the option to continue with the current operations. definitive Facts * The golf manufacturing market is highly competitive. It is important for Callaway golf game Canada to stay ahead of the competition in consecrate for them to keep their reputation and status, as well as increasing their sales. After the success of Callaway Golfs Mobile Performance Team, other golf manufacturers atomic number 18 likely to follow summit and provide much(prenominal) than than service to their customers. * Callaway Golf philosophy states that the company intends to give more golfers more opportunities, by designing, creating, building, and selling the high hat golf gilds. Callaway Golf besides believes that by making golf more enjoyable for the average golfer, the plucky of golf will grow. * In early 2008, Callaway Golf was the largest golf club manufacturer in the world. Golf equipment produces pitch a life cycle of about two years, resulting in pressure on companies to drop off successful new products every year. Failure to release successful new products will result in poor sales in the current year, as well as future sales by hurting the companys reputation. * Companies in the industry used two strategies guidance resources on query and development to develop new, innovative products or focusing resources on securing endorsements from professional golfers on tours, which led to an increment in sales from exposure.Callaway preferred to maintain a small amount of endorsements with high-profile players, while investing and focusing more on research and development. * From 2005 to 2007, nearly 65% of Callaways sales occurred during the first half of the year. * Callaways customers are players from every ability level and a wide range of socioeconomic groups. * Small golf specialty stores were the Callaways biggest customer. Other customers included sporting goods retailers, mass merchants, golf retailers, and pro shops. * The United States Golf Association began to institute policies limiting manufacturer innovation.This reserves manufacturers struggling to find different ways to compete. Other firms had apologise determines as a way of competing, which resulted in a loss of margins across the industry. Firms were also focusing more on securing endorsements with tour professionals. * The goal of the MPT is to maximize the performance of individually individual golfer, non to maximize Callaways sales, even if it means recommending a competitors product. * The MPT program comprises about $500,000 annually. * Callaway has a sales conversion of about 75% from custom fitting sessions. Alternative Solutions 1) Mallette has umteen different ideas on how to improve Callaways sales.His first option is to leave the MPT program idempotent as it has been so successful he does not want to jinx it by changing something that could potentially decrease profit for Callaways Golf. 2) Callaway Golf does not currently require their mobile performance consultants (MPCs) to be professionally certified. If the MPCs were to be professionally certified, they would not plainly be able to give a hybrid service of custom fitting, but they would also be authorized to provide official lessons. This would add greater revalue to the private fitting and consultations if at that place were to be a private lesson included.Having a professional on site would add the credibility and long suit of the consultations. An inconvenience in this plan is that to become certified in Canada, an individual must model a minimum of 35 hours per week under a head professional and pass a vie ability test (Jackman, Brett (2008) Callaway Golf Canada. Ivey Cases page 9). 3) Mallette also is considering pairing the MPCs up with professional staff at the club the MPC is taping at. This would have the same benefit of having professionally certified MPCs, but there wouldnt be the one-on-one aspect that many club members enjoy and value.On the contrary, club members whitethorn be solace by having a member of their clubs professional staff present, it may lead the club member to trust Callaway Golf and the MPC more. It would also be ben eficial as the club member could consult the clubs staff member if they had any more questions after the MPC had left. The inconvenience in this scenario is that Callaway would have to pay the club staff member as well as the MPC. 4) Another option would be to update the equipment that Callaway Golf MPCs use during their consultations.They currently are using Accusport Vector machines that are in fine working condition, but the newest model has just been launched, the Vector Pro monitor which would be useful for the golf professionals during lessons as it incorporates video swing analysis into the fitting process. This may also add value to the consultations. The downside to this ascendent is that each monitor would cost $3,500, as well as bringing all 20 MPCs to the head office for a training day at the expense of Callaway Golf. 5) thither is currently solo one MPC per territory in Canada.There is an average of 30 different accounts in each territory, and Mallette believes that hiring more MPCs would be beneficial in by being able to give more attention to each account. Mallette says that by doubling the amount of MPCs, the amount of service provided would be two-fold. This means that the cost of the MPT program would be doubled as well, considering training and wage expenses. Most fitting days are scheduled for four hours typically, each golf club currently has one fitting day per month, as there is insufficient necessitate to require more (Jackman, Brett (2008) Callaway Golf Canada.Ivey Cases page 8). This leads to the fact that there is insufficient demand for Callaway Golf to guide more MPCs. 6) Callaway Golf is focused on working with their current accounts, which are mainly private clubs. If they were to work more closely with open clubs across the country by bringing them MPT program, more sales could potentially be made. This option would only be realistic if more MPCs were used, as there are many public clubs across the country and the MPT wo uldnt be as successful if they started neglecting their current accounts.Decision Criteria Profitability Choosing to leave the MTP program the same would result in Callaway Golfs net income for 2008 to slightly decline or slightly increase. There wouldnt be much change seeing as there was no change to the MTP program. The cause of decrease would come from the possibility of Callaways competitors launching a program alike to the MTP, causing Callaways to experience fewer sales. The increase could happen if the competitors programs werent a success.Changing the hiring requirements for MTCs would result in a loss of time and money in order to train current employees, or hire professionally certified employees and train them to be MTPs. Since having professionally certified employees would add value to the consultations, Callaway could increase their prices. It isnt clear if this would generate more income in the end result. This solution would benefit only members of private clubs whe re the consultations are held, and public club members may start opting for cheaper products if Callaways increases its prices, which would lead to lower sales.Pairing MTCs with club staff would cost Callaway more in wages expense. It may result in more sales since customers would feel more comfortable with a club staff member, therefore more willing to trust Callaway Golf and taint their product, resulting in more sales. This solution would benefit only members of private clubs where the consultations are held, and public club members may start opting for cheaper products if Callaways increases its prices, which would lead to lower sales. Updating equipment would cost both the equipment price, and the price of training all current MTCs.This would also add more value to the consultations, which would lead to an increase in price of Callaways products, which may or may not lead to an increase in long term income. This solution would benefit only members of private clubs where the co nsultations are held, and public club members may start opting for cheaper products if Callaways increases its prices, which would lead to lower sales. Hiring 20 more MPCs would not be beneficial for Callaway Golf, seeing as there is not enough demand. This would lead to a loss in profit since the extra profit would not be sufficient to cover the extra wage expense.Hiring more MPCs to do consultations at public clubs would lead to an increase in sales for Callaway Golf. Looking at how much the net income increased after launching the MTP program in private clubs, it seems it would be beneficial to launch the program in public clubs as well. There are many more public clubs across Canada, so the sales made at all of these clubs would be greater than the wages expense for the new employees. Customer Satisfaction Leaving the MTP program unchanged would result in the customer satisfaction rate leveling off and eventually declining s competitors better their programs.Changing hiring requ irements to include only professionally certified employees would increase customer satisfaction since there would be more value added to consultations, although this would lead to a price increase which could decrease the customer satisfaction rate if the price increase were too high. Pairing MTCs with club staff would have the same result as hiring only professionally certified staff, although customer satisfaction would likely increase since customers would be more comfortable with a member of the clubs staff.Updating equipment would also increase customer satisfaction because it would be adding value to the consultations. The product price increase may decrease the satisfaction rate. Hiring 20 more MPCs would only lead to customer satisfaction if they were introduced into public clubs. The public club members would likely be very happy to have a private consultation, which leads to a higher rate of customer satisfaction. If 20 more MPCs were hired only to work in private clubs, the unique value of consultations would go down, causing fewer sales and more employees with zippo to do. RecommendationBased on the decision criteria, the best choice for Wayne Mallette to ensure that Callaway Golf Canada stays one step ahead of their competition is to hire more MTCs to work in public clubs. This is the best choice because both advantageousness and customer satisfaction would increase. It would also assure customers that Callaway Golf is not only a company for impatient golf players, but for average players just like the Callaway Golf philosophy states. Starting consultations in public clubs would build Callaways reputation even more, increase sales and profit, and customer satisfaction. This is the best case scenario for Mallette to choose.