Reference no: EM133481294

Case: About the GlucoGaugeMonitor -Kurt Stewart, Director, Customer Insights Matterhorn Health's Home Care Division recently launched the GlucoGaugeblood glucose monitor to the market. The GlucoGaugeis one of the most innovative technologies in home care to date. The R&D group in the Division worked on the new glucose electronic monitoring device for over 3 years and the development cost was the highest the company had ever incurred for a consumer medical device. Blood glucose monitoring is carried out by having the consumer ( or patient) apply a small volume of blood to a coded test strip and inserting that strip into the measuring device. Accuracy is critical. Price, size, and other features are also important. The company's R&D and manufacturing areas were acutely aware of the potential issues for the patient associated with inaccurate device readings, which could range from mild symptoms to serious complications or even death. Matterhorn Health's Home Care Division worked diligently to ensure that its state of the art device was as accurate as possible in measuring blood glucose levels. Matterhorn recently used a new supplier for the microprocessor used in the device. The microprocessor is the single most important component in this device. Initially there were issues with the microprocessor which impacted the accuracy of the readings in early QA testing. Although the technology of home blood glucose monitor devices is so effective that results can be extremely accurate, a certain level of inaccuracy is tolerated by the FDA in its regulation of blood glucose device manufacturers. Devices are allowed to have a within 20% "field" inaccuracy rate. This rate is defined as the difference between the expectation of measurement results and the true value of the measured quantity. "Field" inaccuracy rates are often higher because conditions cannot be controlled at home the way they can be in a lab. Uncontrolled conditions can involve consumer misuse, such as incomplete strip insertion. However, it can also involve malfunctioning of the device's microprocessor, such as when it is exposed to extreme conditions, including high temperatures for a prolonged period of time. Matterhorn Health's R&D department set an internal target inaccuracy rate for the new device at 15% which was lower than the FDA-mandate "less than 20%" inaccuracy rate, but higher than the American Diabetes Association's rate of 10%. While the internal target was 15%, the company's own testing of the device with customers in the field had yielded an inaccuracy rate of 10%, much better than the company's internal target and equal to the ADA's standard. It was therefore surprising when reports from physicians who had reviewed the downloaded data on their patients' glucose readings reported up to a 30% inaccuracy rate in the "hypo" zone or zone of blood glucose readings from 40-80 mg/dL. Our team is working to get to the bottom of these reports, so you can feel confident in the GlucoGauge.

Question 1: What key decisions did you make? Why did you make those choices?

Question 2: What aspects of the situation did you find most challenging?

Question 3: How did you cope with the high level of ambiguity in the situation? How did you handle the lack of complete information? How did you cope with the increasing levels of stress that you may have encountered during the unfolding situation?

Question 4: What should the CEO tell the media at the press conference? Be prepared to role-play that situation, either as the CEO or as a media member asking tough questions.

Question 5: What advice do you have for managers in these types of crisis situations?