Diagnosing Industrial Service of American Inc - Essay Example

? Diagnosing Industrial Service of American, Inc Introduction Organizational diagnostic uses specialized procedures to collect vital information about the organization so that it can use it to design appropriate organizational interventions. In order to diagnose the organization, the organization should be viewed as total system just like the human system. The major aspects that should be focused are the inputs, the throughputs, and outputs. The last aspect constitutes an aspect that integrates these three and is called the feedback loops. In order to fully diagnose any given organization, it is imperative o understand all the activities that takes place within the organization (Rue &Lloyd, 2003). The paper shall focus on Industrial service of American Inc. as our reference organization. The ultimate aim of this paper is to diagnose and determine whether the Industrial service of American inc. is performing according to the expectations. The paper shall consider the input and output organization. From the findings on how the inputs are organized, it would be easier to tell whether the overall performance of the company is high, medium, or low. The first section shall describe the kind of activities taking place in this company. Industrial Service of America, inc. is a company dealing with the recycling of the stainless steel, and non-ferrous products. The company also has a role of providing various services to the customers. However, according to the market analysis, the company is primarily focuses its attention towards recycling business (McLuhan, 2005). The kind of activities taking place in the company involves collecting, purchasing, and selling different recyclable metallic equipments. The company has two categories of activities. The first category involves buying, processing and sale of stainless steel related equipments including the high-temperature alloys. The second category deals with the non-ferrous scraps such as copper, aluminum, and brass. As far as waste service segment is concerned, the company leases and sells service waste and recycling equipments (Nadler & Tushman, 1980). Inputs In order to diagnose the organization situation of the Industrial Service of American, inc. there is a need to review how the company organizes and integrates its inputs. The main inputs used in the company include the raw materials, the human resource, the capital and the management skills and knowledge employed. The main raw materials used by the company include the land, the scrap metals. As far as the scrap metal is concerned, the company has reliable sources of scrap metal. There are two main sources of these raw materials (Jones & Jennifer, 2006). The first source is the industrial and commercial non-ferrous scrap metal providers. This is where the company gets materials such as waste aluminum, copper, stainless steel, nickel-bering metals, brass, and others. The second main source of the raw materials is the peddlers who collect the material from variety of sources and deliver to the company. The company has inventory system that is used to monitor the quantities of the ferrous and non-ferrous raw materials that include the stainless steel, and the scrap. The inventory system is designed in a manner that the cost use to purchase the raw materials is relatively lower than the anticipated selling price (Jones & Jennifer, 2006). In this vein, if the company is anticipating for a future decline in the selling price of the scrap metal and the finished products, then it would make any adjustment it feels necessary in order to reduce the value of the inventory so tat it is in line with the anticipated value. The raw materials handled by the company are classified into two. The first category involves those that are in saleable condition at the time of acquisition. This means that little or no transformation would be imposed on these kinds of raw materials (Rue &Lloyd, 2003). The second category of raw materials constitutes those raw materials that are not in saleable conditions. This means that the company must process. The non-ferrous metals undergo three major transformation processes. These include the sorting process where instruments such as the grinders, hand torches, and spectrometers are used. Sorting is done so that the company can identify the metallurgical composition. This would enable the company maximizes the profits (McLuhan, 2005). The materials are then classifies based on the type, grade, size, and chemical composition. The materials are then sheared to reduce their sizes so that they can be convenient to handle. The resultant product are then baled into large uniform blocks. During the baling process, the materials are fed into the hydraulic press by use of conveyors. The press will compress the material into uniform blocks ready for sale. The selling price would depend on the money value according to the London Metal Exchange. Another aspect, which is important as far as inputs are concerned, is the fact that the management is computerized. The company has designed and developed proprietary computer software that has several uses (McLuhan, 2005). These include provision of relevant information on each customer’s location. They also provide pertinent information on cost of equipment, disposal rates, shipping, and recycling prices. The software enables the company to generate detailed monthly billing report as and price tracking. This would enable the company meet the customers need. Additionally, the company has a network of over 2000 maintenance service providers, hauling and landfill spread throughout the US. Other aspects of inputs such as management and technology put into the company are equally well organized. Despite the fact that the company faces competition from other companies, the company has an advantage over its competitors in that it has a systematic approach that attempts to provide consistent results for the customer (Nadler & Tushman, 1980). This approach enables the company to actively bid out every location that a new customer request. The company also evaluates the customer’s solid waste and recycling program at subsequent intervals. The company also gets discounted hauling and maintenance rates because of the economies of large-scale production. Another added advantage that the company has over its competitors is the national network of service providers. This enables the company to have nationwide geographic coverage. The company also a well represented employees. It has employees of different expertise. There are those that deal with the recycling, management services, sales and leasing, drivers and administration/ information technology. It is therefore apparent that the inputs organization is done according to the expected standards. From the above findings, it is clear that the overall performance of the company is high because the inputs are organized in a very efficient manner (Rue &Lloyd, 2003). Outputs The output form the company is mainly determined based on the returns realized from the sale of the processed scrap metals. Principally, the company buys the scrap metals at the value lower of average purchased cost. The output can be based on the sales volume, which, according to the company, depends on the state of the inventory systems. However, reliance of sales volume alone may not give comprehensive information regarding the actual financial position in terms of outputs. The output is also determined based on the number of customer location that the company serves throughout the United States. Consequently, the paper shall use the financial statements to predict the level of output from the company. According to the financial records, the company is currently serving more than 2100 customers. It also has a database of over 6500 vendors that provide timely and cost-effective service to its customers. Liquidity and capital resources also reflect the position of the company as far as outputs are concerned (Rue &Lloyd, 2003). The financial statement shows that the company has had several transactions that involve cash. This is a reflection of the stability of the company. In order to determine whether the output from the company are rising, the company prepares and compare the financial statements from different trading periods. Than the change in the revenue realized will determine the state of the company. We shall review some of the financial accounts and then base on the findings, we would diagnose whether the company is advancing positively or negatively. The financial statement for the year ended December 31, 2008 compared to year ended December 31, 2007 shows that the total revenue increased by 30% in 2008 compared to 2007 (Rue &Lloyd, 2003). On the other hand, the revenue realized from the recycling sector rose by 38%. The company also realized a 2% increase in volume of shipments. The management service also experience a significant increase in revenue realized. The financial statements show that management service revenue rose by 5%. On the other hand, the equipment, service, and leasing revenue rose by 9% between the two periods. The company also realized a significant increase in the total cost of goods sold. According to the report, the increase was about 30%. On the other hand, the recycling cost of goods sold rose by 36% during the two periods. From the above findings, I think that the overall performance of the company is high mainly because the returns from the outputs is significantly high (Jones & Jennifer, 2006). Conclusion Having described the organization of companies inputs as well as the level of output, it is beyond any reasonable doubt that the overall performance of the company is high. This claim matches the argument given by Nadler & Tushman that states that other things being equal, the greater the total degree of congruence or fit between the various components, the more effective will be the organization (p. 45). References Jones, G. R., and Jennifer M. G. (2006). Contemporary Management. 4th ed. New York, NY: McGraw-Hill Irwin, McLuhan, R. (2005). Closing the channel loop. Marketing Direct, p.S11-S12,S14-S15. Source: ABI/INFORM Trade & Industry. Nadler, D.A. & Tushman, M.L. (1980) A model for diagnosing organizational behavior. Organizational Dynamics, 9 (2), 35-51. Rue, L.W. and Lloyd L. (2003). Management: Skills and Applications. 10th ed. New York, NY: McGraw-Hill Irwin publishers. Read More