Product Deletion in the Information Technology Industry
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IEEE ENGINEERING MANAGEMENT REVIEW, VOL. 47, NO. 4, FOURTH QUARTER, DECEMBER 2019 55 Product Deletion in the Information Technology Industry —PURVI SHAH Abstract—IT companies invest substantial monetary and nonmonetary Foisie Business School, Worcester Polytechnic resources in introducing or acquiring new products and managing them. Institute, Worcester, MA 01609-2280 USA However, not all of these IT products remain profitable, valuable, and strategic for a company. It is beneficial for the IT company to delete weak products from the product portfolio and re-channelize the freed resources to strong products in order to improve financial performance. Three internal factors influencing product deletion in IT companies are (1) deleting an existing product to introduce a new one; (2) deleting a relatively new product to merge it with an IEEE DOI 10.1109/EMR.2019.2948165 established product; or (3) merging multiple products into one product. Alternatively, three external factors that impact product deletion decisions in IT companies are (1) privacy concerns and issues; (2) unfavorable reviews from technology experts; or (3) mergers and acquisitions. Understanding these unique factors that trigger product deletion in IT firms can facilitate the decision-making process and aid managers in successfully implementing the product deletion. If managed appropriately, product deletions could help a company redeploy its valuable resources to strong products in the portfolio, create a superior competitive position in the market, and bolster growth and financial performance. Key words: Information technology industry, product deletion, product portfolio management 1 PRODUCT DELETION IN technology (IT) industry where THE INFORMATION product lifecycles are measured in weeks or months and keeping pace TECHNOLOGY INDUSTRY with this time pressure is crucial [Meares & Sargent, 1999]. “New products have ... glamor Their successful IT companies invest substantial introduction promises growth in monetary and nonmonetary resources fi sales and pro ts that may be in introducing or acquiring new fantastic. But putting products to products and managing them. — — death or letting them die is However, not all of these IT products a drab business, and often remain profitable, valuable, and engenders much of the sadness strategic for a company. Over time, fi of a nal parting with old and some products fail to achieve the ... tried friends But while deletion purpose for which they were created, is an uninspiring and depressing reduce the value of the company’s process, in a changing market it is almost as vital as the addition of new products.”—[Alexander, 1 This includes data processing services, computing services, internet search engines, 1964] computer gaming, electronic networks, internet services email services, computer data stor- This statement is especially true age, internet hardware and software providers, and other similar companies. Some examples in the dynamic, fast-paced, and include Google, Amazon, Facebook, Yelp, Sea- ever-changing information gate, and Dropbox. (SIC) Authorized licensed use limited to: Worcester Polytechnic Institute. Downloaded on June 26,2020 at 12:23:06 UTC from IEEE Xplore. Restrictions apply. 56 IEEE ENGINEERING MANAGEMENT REVIEW, VOL. 47, NO. 4, FOURTH QUARTER, DECEMBER 2019 product portfolio, and efficiently utilize of existing products to introduce new Inbox was gaining popularity and the company’s valuable resources products is the most frequently positive reviews. However, with an aim [Shah, 2015]. It is beneficial for the occurring situation in the IT industry. of focusing resources on one strong company to delete—discontinue— An existing product which is no longer email platform, Gmail, Google such weak products from the product relevant, profitable, or strategic is discontinued Inbox in 2018. It merged portfolio and re-channelize the freed deleted and replaced with a more many Inbox features into Gmail. Gmail resources to strong products in order to relevant and strategic product with a has been an established product since improve financial performance profit-maximizing goal. For example, 2004 and has over a billion users ([Kumar, 2003]; [Shah, Laverie, & Google Notebook, a free online worldwide [McCracken, 2018]. Davis, 2017]; [Varadarajan, Defanti, & software application that enabled Busch, 2006]). users to keep notes, clip text and Merging multiple products into one images, save weblinks, and organize product. IT companies are Companies delete products when and share information, was launched continuously innovating. In this products (1) do not perform well on in 2006. Google announced in 2009 process, they sometimes end up with fi nancial parameters; (2) do not meet that it will discontinue Notebook, and multiple products that are either fi consumer needs; (3) do not t with Google Docs would be available to redundant or complement one ’ the company s strategic direction; or export user contents from Notebook another. Consolidating them into one fi (4) do not t well with other products [Krishnan, 2009]. single product could create a win-win ’ in the company s product portfolio situation for a company and its [Shah, 2017a]. Obsolete IT products are also deleted consumers. to make room for newer models Companies also delete products in possessing better features and The company benefits by saving precipitating circumstances such as: designs with the goal of shortening the product management time, costs, and (1) complying with government policies replacement cycle and inducing repeat other valuable resources invested in and regulations; (2) responding to purchases. This process is known as multiple products. It can redeploy competitive actions; (3) dealing with planned obsolescence ([Bulow, 1986]; these resources into managing one raw materials and parts issues; € (4) reducing variety in the product [Meng, Thornberg, & Olsson, 2014]). stronger product. Consumers would portfolio; (5) maintaining a fitwith Examples include the launch of newer gain from a better user experience smartphone models every year making because now the various benefits company image and capabilities; (6) older models obsolete and introducing from multiple products are available in channelizing resources to new product newer versions of software one product. Google Play Newsstand development; and (7) rationalizing the applications and discontinuing support and Google News & Weather are an portfolio due to mergers and for the older versions. example. In 2018, these two major acquisitions [Avlonitis, 1987]. offerings were deleted and merged In addition to these situations, there Deleting a relatively new product to into one product called Google News. are unique factors that trigger product merge it with an established Interestingly, Google Play Newsstand deletion in the IT industry. product. IT companies are also was a news aggregator and digital Understanding how these factors known to delete relatively new newsstand created in 2013 through influence the product deletion in IT products—in their introduction or an amalgamation of Google Play firms can facilitate the decision-making growth phase. To retain the users of Magazines and Google Currents. process and aid managers in this new product, they offer an Google News & Weather was also a successfully implementing the product established mature product as a news aggregator app that was deletion. These factors are internal and substitute by merging some features launched in 2014. In 2018, Google external in nature. Internal product of the new product into the mature decided to focus on a single news deletion factors are strategic and arise product. This situation occurred when product called Google News— within the company. External product Google launched Inbox in 2014. launched in 2002—so that its users deletion factors stem from forces can find curated news, magazines, outside the company. The purpose of Inbox was to help headlines, weather forecasts, as users improve the productivity and well as blog posts, in one application INTERNAL FACTORS organization of emails. Some [El Khoury, 2018]. capabilities included bundling emails INFLUENCING THE DELETION with similar themes, providing Similarly, Picassa Desktop and Web OF IT PRODUCTS reminders and snooze features, undo Albums were deleted, and all the Deleting an existing product to send and smart reply features, and content was merged into one product introduce a new one. The deletion previews of certain types of emails. called Google Photos. The purpose of Authorized licensed use limited to: Worcester Polytechnic Institute. Downloaded on June 26,2020 at 12:23:06 UTC from IEEE Xplore. Restrictions apply. PRODUCT DELETION IN THE INFORMATION TECHNOLOGY INDUSTRY 57 gathering relevant content into one Gizmodo, Mashable, and hour of video. In 2011, Cisco stopped place was to enhance user TechRadar. When a new IT product making and discontinued the Flip mini experience and to better utilize is launched, many consumers visit camcorder stating that it is company’s resources. these technology review websites to “strategically realigning its business gain more product knowledge and to focus on selling its core products” EXTERNAL FACTORS expert opinions; informing their [Reardon, 2011]. purchase and usage decisions INFLUENCING THE DELETION [Zhou & Duan, 2016]. If a product Similarly, Google acquired Sparrow, OF IT PRODUCTS has received unfavorable or an email client software, in 2012 and Privacy Concerns and Issues. In negative professional reviews, it deleted the