Certified Production & Operations Manager (POM) Practice Exam

At what stage of the product life cycle does product strategy primarily focus on improved cost control?

1. Introduction stage

2. Growth stage

3. Maturity stage

4. Decline stage

The correct answer is: Maturity stage

The correct answer is centered around the maturity stage of the product life cycle, where product strategy indeed focuses heavily on improved cost control. During this phase, sales growth begins to slow down, and the market becomes saturated with competition. Companies are often seeking ways to maintain profitability while managing costs effectively to sustain market share. In the maturity stage, businesses face increased price competition and may need to enhance their operational efficiency to lower production costs, streamline processes, and optimize supply chain management. This focus on cost control can involve leveraging economies of scale or improving production techniques to maintain margins despite a stagnant or declining growth in sales. Shifting the spotlight, in the introduction stage, the focus is primarily on creating awareness and establishing a market presence, while the growth stage emphasizes scaling production and increasing market penetration rather than cost control. In the decline stage, strategies often pivot towards liquidating remaining assets or finding niche markets, rather than focusing primarily on cost management. By prioritizing cost control during the maturity stage, companies can better position themselves against competition and adapt to the maturity phase challenges effectively.