This company’s surgical device offers many benefits with respect to reliability and time required for this heart surgery procedure. However, market share for this high performance surgical product is hindered by equipment needed, reluctance among surgeons to try something new, trial success, and adoption of the product following a successful trial. These share performance metrics and product awareness are built into the Share Tree above in the sequence these aspects of share performance occur.
For each share performance gate in the share tree, the business estimated its current performance. For example, only 50 percent of the market has the equipment in place to use this high performance surgical product. Of those that have the required equipment in place, 90 percent are aware of the company’s product and procedure. However, 35 percent of those with required equipment and aware of the product are not motivated to try the product/procedure. This results in a share leakage of 18.9 percent as shown in the share tree. When all positive share performance outcomes are multiplied sequentially, an overall Market Share Index of 6.8 percent is computed as shown below.
Market Share Index (MSI)
MSI = Equipment x Aware x Motivated to Try x Trial Success x Adoption = 50% x 90% x 60% x 50% x 50% = 6.8%
Using the same share tree, the business team estimated the upper end performance for each share metric. This is their Share Potential Index as illustrated below.
Share Potential Index (SPI)
SPI = Equipment x Aware x Motivated to Try x Trial Success x Adoption = 75% x 95% x 70% x 67% x 67% = 22.4%
If we divide the Market Share Index by the Share Potential Index and multiply by 100, we can create a Share Development Index. The current Share Development Index is 30, as shown below.
Share Development Index (SDI)
SDI = Market Share Index (current) / Share Potential Index x 100 = 6.8% / 22.4% x 100= 30
The blue boxes in the share tree above are share performance benchmarks set by the company. If successful, this will improve their Market Share Index from 6.8 percent to 15.8 percent. Using the same Share Potential Index (22.4 percent), this would improve their Share Development Index from 30 to 70 as shown in the dial above.
While the Market Share Index computed using the share tree only approximates actual market share, improvements in these measureable share performance metrics should contribute to actual share gains.
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