Product Life Cycle and Industry Life Cycle
Recognizing that all living things go through a cycle of birth, growth, maturity, and death, the inspiration for the concepts of product life cycle and industry life cycle comes from biology. The life-cycle concept is an appropriate description of what happens to products and industries over time. When applied to organizations, the product life cycle and industry life cycle contain the four stages of introduction, growth, maturity, and decline.
This concept is much more than an interesting analogy of business and biology. In biology, a living organism's position in its life cycle leads to different courses of action concerning the organism's future. An industry's position and a product's position in their life cycles also lead to very different decisions concerning their futures. Consequently, the life-cycle concept was adopted from biology for use as a strategic planning tool for products and industries.
The following sections define the terms, explain why products have a life cycle, describe the stages of the product life cycle, and examine the strategic implications of the product life cycle.
Definitions
The life cycle can be used to observe the behavior of many concepts in business. In its classic form, which is described in a later section, it is best applied to products and industries.
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