Handstar Inc.
Handstar Inc. was created a little over four years ago by two college roommates to develop software applications for handheld computing devices. It has since grown to ten employees with annual sales approaching $1.5 million. Handstar’s original product was an expense report application that allowed users to record expenses on their handheld computers and then import these expenses into a spreadsheet that then create an expense report in one of five standard formats. Based on the success of its first product, Handstar subsequently developed three additional software products: a program for tracking and measuring the performance of investment portfolios- a calendar program, and a program that allowed users to download their email messages from their PC and read them on their handheld computers.
The two founders of Handstar have recently become concerned about the competitiveness of their offerings, particularly since none of them has been updated after their initial launch. Therefore, they asked the directors of product development and marketing to work together and prepare a list of potential projects for updating Handstar's current offerings as well as to develop ideas for additional offerings. The directors were also asked to estimate the development costs of the various projects, product revenues, and the likelihood that Handstar could retain or obtain a leadership position for the given product. Also, with the increasing popularity of the Internet, the founders asked the directors to evaluate the extent to which the products made use of the Internet.
The product development and marketing directors identified three projects related to updating Handstar's existing products. The first project would integrate Handstar's current calendar program with its email program. Integrating these two applications into a single program would provide a number of