Good Pay Trumps - Essay Example

NASDAQ Planning to Upgrade its Systems Peter and Donnelly discuss the importance for an organization to introduce new products or carry out product improvements in its existing products. According to Peter and Donnelly, a good management has "heavy emphasis on planning, organization and interaction among the various functional units" (p. 99). The authors also point out that new products or developments are often responsible for over 50% of the sales revenue of a company (p. 98). Under the circumstance, any company wishing remain competitive must continually keep upgrading itself or face extinction at the hands of competitors or become so outdated that they may have to answer to regulators.

Strasburg and Bunge (p. C1, 29 Jun 2012) discuss the need for NASDAQ to quickly upgrade itself or being forced to do so by SEC. As Strasburg and Bunge point out, NASDAQ had always had the reputation of having cutting edge systems and had cultivated an image of being a leader in exchange technology. However, the recent Facebook IPO exposed some of the glitches in NASDAQs current system as it froze in the face of high volumes. Due to these glitches, many traders faced losses during Facebook IPO and NASDAQ will have to compensate these brokers leading to overall losses for the company.

In recent years, NASDAQs chief executive, Robert Greifeld, has implemented many cost cutting measures, though he has invested in acquisitions. This shows that Greifeld is not completely opposed to taking risk. However, by not upgrading his system, he has exposed the company to losses and action by regulators. As Peter and Donnelly (2010) point out, a good management should be able to balance out risks and need for innovation and have a culture that encourages continuous improvements. Unfortunately, NASDAQ seems to have become too complacent regarding its reputation as the industry leader in exchange technology and failed to carry out timely improvements in its products.

According to Peter and Donnelly, the key reason for the failure of a company or its product is the inability to satisfy customers due to "inadequacy of upfront intelligence efforts, failure on the part of the company to stick close to what the company does best, and the inability to provide better value than competing products and technologies" (p. 99). In case of NASDAQ, we see that the company is facing losses and reprimand by SEC because it failed in each of these three areas. It failed to anticipate the high trading demands that would be placed on its system during the Facebook IPO, leading to glitches.

It also failed to keep up with cutting edge technologies, something it is known for and by failing at the most critical time, it has allowed its rivals an opportunity to beat it in the technological field, where it had ruled until now. NASDAQ needs to quickly upgrade itself, if it needs to remain competitive and retain its reputation as the technological leader in the exchange industry. And for this, it needs to find the right balance between investment and cost cutting. Works Cited Peter, Paul, and James Donnelly.

Marketing Management: Knowledge and Skills. 10th. New York: McGraw-Hill/Irwin, 2010. Print. Strasburg, Jenny, and Jacob Bunge. "SEC Could Seek NASDAQ Upgrading ." Wall Street Journal 29 Jun 2012, C1. Print.