According to Lidwell, Holden and Butler (2003, p.76), the resultant effect of every action is an equivalent and opposite reaction. This means that effecting change one factor affects another factor which in turn affects the first factor. This culminates into creation of a feedback loop.
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Lidwell, Holden and Butler (2003, p.77) asserts that all systems in the real world are made up of numerous interacting feedback loops. Feedback loops are categorized into positive and negative loops. Lidwell, Holden and Butler (2003, p. 78) further assert that positive feedback loop are important in the firms’ process of implementing change.
However, positive feedback loops can result into negative effects if not restrained by negative loops. On the other hand, negative feedback loops in a given system resist change from occurring. Both the positive and negative loops are important in the firm’s process of operation.
This arises from the fact that they aid in maintaining equilibrium. Considering the interdependence between the positive and negative feedback loops, firm’s management team realize that they must consider all the elements in an organization when implementing change.
Desire to develop high quality products
According to Denton (2002), a balancing loop refers to any action which is aimed at moving a firm from its current states to a particular desired stated.
Balancing loop is considered to be one of the fundamental components of organizational structures and systems (Bellinger, 2004, para. 1). In its operation, there are a number of balancing loops which can be identified at Palm Inc. An example of such a balancing loop relates to the firm’s objectives.
In its operation, Palm’s goal is to improve the quality of its mobile device products. In order to achieve this, the firm intends to develop a mobile device brand which is characterized by a high degree of innovation and also which is intuitive.
In order to achieve this, the firm’s management team has integrated various learning activities. One of the ways through which this is attained arises from the collaboration of individuals at various levels such as the organizational level, group level and individual level. This enhances creation of knowledge within the organization.
For example, in the process of developing new product, the concept of group dynamic is integrated. The new product development team is composed of individuals from different departments. In addition, learning opportunity is also attained through training at various levels.
For example, the firm trains its wireless carriers on various characteristics of its products. This ensures that the consumers are conversant on how to use the products (Rubinstein & Jeffries, 2009, p. 8).
In its domestic market, the firm’s brands have attained substantial market recognition amongst the mobile devices which are characterized as easy to use and innovative. In order to remain competitive, it is the firm’s objective to expand its brand recognition into the global market. This can only be achieved if consumers attach a high value to the product. The core objective is to create and retain customer loyalty.
The firm’s management team beliefs that it can establish a lasting customer relationship via development of high quality, easy to use and innovative products. The firm links its products quality, the ease of use and the innovative characteristic with high customer satisfaction.
Increase in demand for the firm’s smartphones
Reinforcing loop refers to forces which further enhance the outcome of the balancing loop (Bellinger, 2004, para. 1). In its operation, Palm Inc, a market research team whose role is to identify changes in the market. According to Rubinstein and Jeffries (2009, p. 4), Palm Inc. is able to access market feedback from both its channel customers and the end users of its products and services.
This enables the firm to gain information regarding the customer’s product requirement. As a learning activity, market research enables the firm to gain information regarding market trend. The information gained from the market research aids in development of a database which is used in the process of new product development.
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According to Rubinstein and Jeffries( 2009, p. 4), the information gained from the market is also used in refining its products in addition to developing strategies which enables the firm to market its products effectively. Market research also enhances the firm’s decision making process through development of a Decision Support System (DSS).
The increase in customer demand with regard to mobile devices which result into higher customer experience has been motivating the firm’s efforts to produce and supply its products.
Over the past few years, the firm has witnessed increased demand from both individual and institutional clienteles whose basis of operation is Windows environment. These customers are increasingly demanding a higher customer experience (Rubinstein & Jeffries, 2009, p. 4).
High customer satisfaction as a result of attaining value will culminate into a further increment in demand for the firm’s products. During its 2007, 2008 and 2009 financial years, the firm has experienced a significant reduction in volume of its smartphones sales both in the domestic and international market. Over these years, Palm has incurred substantial net losses.
By improving the quality of its products, the firm’s performance will be enhanced hence increasing its growth potential. According to Rubinstein and Jeffries (2009, p. 15), the 2007 economic recession had a negative effect on the firm’s commitment to undertake continuous investment in various activities. The effects of the economic recession coupled with reduction in the firm’s sale could force the firm to seek additional financial capital.
Sourcing for capital from financial institutions in form of loan may not be easily forthcoming considering the stringent nature of banks (Rubinstein& Jeffries, 2009, p. 15). Increase in demand for the firm’s products will culminate into an improvement in the firm’s liquidity hence its ability to conduct investment effectively. This will further stimulate the firm’s growth potential.
In an effort to meet the increased customer demand, other operations such as customer service may be negatively affected. However, Palm Inc intends to prevent this through various strategies such as community involvement, improved customer service, public relations and marketing. The resultant effect is that the firm’s brand will be strengthened. The diagram below gives an illustration of the balancing and reinforcing loop.
Figure 1: Diagram showing Palm Inc, balancing and reinforcing loop
According to Easterby-Smith and Lyles (2005, p. 253), organizational learning refers to the process through which values and knowledge related to a particular firm are exchanged. The resultant effect is improved solutions in addition to ability of the firm’s employees learning from action.
Organizational learning depicts a firm’s values and culture. This arises from the fat that it occurs at individual and group level. A firm’s learning culture is dependent on the nature of relationships established within an origination. In its operation, all the units in Palm are closely knit. This has had a significant influence on individual employees’ behavior.
In its effort to attain high level of customer satisfaction by supplying high quality products, the firm has to be effective in the process of designing the smartphones and other products it deals with. In order to achieve this, a strong collaboration between the firm’s internal departments is ensured.
For example, the research and development team collaborate with other departments such as the manufacturing team, supply chain team and marketing team. The core objective of this collaboration is to ensure that all the processes undertaken adopt the customer focus design.
In designing the smartphone, all the teams involved rely on information obtained from their counterparts. This increases the firm’s efficiency and effectiveness in the provision of innovative products characterized by ease of use, mobility, functionality, style and simplicity.
With regard to increase in demand, the firm’s research and development team has to rely on market feedback. The supply chain and marketing team are better placed in obtaining market information. This presents an opportunity in that they can be able to identify market trends such as change in consumer behavior regarding the firm’s product.
Due to their direct interaction with the customers, these teams can be able to identify consumer attitude regarding the firm’s products. The information obtained from the market enables the research and development team to conduct effective product innovation culminating into increased customer satisfaction.
Bellinger, G. (2004). Balancing loop. Web.
Bellinger, G. (2004). Reinforcing loop. Web.
Denton, J. (2002). Organizational learning and effectiveness. New York: Rout ledge.
Easterby-Smith, M. & Lyles, M. (2005). The Blackwell handbook of organizational learning and knowledge management. Boston, MA: Wiley-Blackwell.
Lidwell, W., Holden, K. & Butler, J. (2003). Universal principles of design: 100 ways to enhance usability, influence perception, increase appeal, make better design decision and teach through design. Beverley MA: Rockport Publishers.
Rubinstein, J. & Jeffries, D. (2009). Palm Inc. Washington: United States Securities and Exchange Commission.