Reference no: EM133379341

Visual GmbH is a small sized German company that produces motion detectors for the B2B sector. It is an innovative company which received special recognition in their market for a video camera technology they have successfully developed and established in airports to detect conspicuous behavior of individual persons. To expand their target markets, Visual GmbH heavily invested in the past three years most of their R&D money into a new technology aiming at analyzing body language. The target application of this system is to help Human Resources departments in selecting the right candidates for important job positions. The technology uses artificial intelligence to identify patterns in the candidates' body language to derive a psychological profile. Recently Visual GmbH developed a functioning and reliable prototype named CandidScreen. The CandidScreen combines hardware technology (the camera) and the analysis software. The camera's technology isn't really innovative nowadays. The hardware is already tested and certificated. Therefore, Visual GmbH was unable to obtain patents for the hardware. The prototype is very expensive, but it is very likely that the costs for the hardware can be significantly reduced once production has started. The software is not fully developed yet and still has some flaws. The validity of the psychological profile produced by the software is not perfect yet. CandidScreen's software relies on some AI principals that have been developed by researchers at MIT. As all AI-base solutions, the software needs to be trained by massive data. Visual GmbH had access to a large number of training videos and (later) assessments of candidates. But the algorithms need more data input to show their full potential in the valid analysis of body language. Thus, although the CandidScreen system has been tested successfully in the lab, but the success or hit rate in finding the right candidate for job positions can only be increased by using the system in the real world under varying conditions. In general HR departments are known to be very risk averse and not open for experiments when hiring people in important positions. There are many European directives for recording and analyzing video material on individuals and a lot of time will be required for the legal approval of the product. Recently newspapers have reported about MotionTech AB, a powerful Swedish company. They have just started to invest in developing a similar technology that is very likely based on the same published research articles on which also Visual GmbH relies.

QUESTION : Make a recommendation about the timing strategy. Should the Visual GmbH try to enter the market right away as early as possible or should they wait and postpone market entry? Please substantiate your recommendation by using specific information and on the basis of comprehensive arguments.