Certified Production & Operations Manager (POM) Practice Exam

Which of the following OM strategy/issues should a firm with a product in the maturity stage of its life cycle be least concerned with at the present time?

1. Increase capacity

2. Enhance product features

3. Reduce production costs

4. Find new market segments

The correct answer is: Increase capacity

A firm with a product in the maturity stage of its life cycle typically focuses on maintaining market share and maximizing profitability, as the growth phase has stabilized and competition is often intense. In this context, increasing capacity is often less relevant at this stage. The product has already reached its peak sales and demand, so there is little need to expand production capabilities significantly. Instead, firms are more likely to concentrate on enhancing product features to differentiate themselves from competitors, reducing production costs to improve margins, and finding new market segments to sustain or grow their sales in a saturated market. These strategies are aimed at retaining customer interest and maintaining a competitive edge rather than expanding capacity, which may lead to excess supply and increased costs without a corresponding increase in demand at this point in the product's life cycle.