Philips' Compact Disc Introduction (B)

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Compact case

Supplement

Reference no. 9-792-036

Subject category: Strategy and General Management

Authors: Anita McGahan (Harvard Business School)

Published by: Harvard Business Publishing

Originally published in: 1991

Version: 17 October 1991

Revision date: 13-Feb-2018

Length: 4 pages

Data source: Field research

Topics: Capital investments; Decision making; Computers; Managing uncertainty; Value of information; Game theory; Demand analysis; Technology; Competition

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Abstract

Updates students to 1982. Asks students to consider Philips' best strategy for investing in disc-pressing capacity dedicated to the United States market. The analysis draws on game theoretic techniques (in normal form with subgame perfection as the governing equilibrium principle). The analysis illustrates the tension between competitive pressure to preempt and the value of flexibility in the presence of uncertainty about demand.

Location:

Netherlands

Industry:

Technology