Management of Drill Power - Essay Example

First I want to thank you for this assignment; I hope the teacher likes it as much as I did. I just added some comments that you will find in the document. Also, I don’t seem to find anything about you need to consider the future Management structure and any Industrial Relations issues that might arise, bearing in mind that you have the opportunity to reshape the organisation completely. Please when you add it out a comment on it so I know. As the existing employees are trained, and the new employees with high skill level are recruited to meet the demands of the in-house manufacturing process, there will be no need to reshape the organization completely or change the future management structure. Also, Does Drill Power manufacture and or assemble this innovative design? I have mentioned through out the paper that Drill Power has to go for manufacturing process or in-house manufacturing process instead of assembling route No conclusion or table of content. Added Please bear in mind that you can’t exceed 2500 words. Table of Contents Introduction 2 Background 2 Company structure, Recruitment Plan and Important Decisions 3 Five year financial plan and CPA 7 Marketing plan 8 Reference 10 Management Introduction Any organized human activity, which is done in-group, will be most times constituted into an organization. So, Organization is a structure with a ‘collage’ of humans doing their allocated work under the supervision of a leader, for the benefit of the organization as well as them. These workers will normally be apportioned into different departments for better arrangement or streamlining of work. Among the many departments, which constitute an organization, the marketing department’s role is omnipresent and crucial. It can only, boost an organization by adopting various strategies. That is, with every organization wanting to expand their reach and make an imprint in various markets, there will be enough opportunities for it, to initiate that expansion drive. So, when the organization has enough opportunities, it can set targets and formulate various strategies to achieve those targets or end products. Every organization survival and success hinges on the success of its end product. End product could be any physical products or even services that are offered. So, both the product and the services are the ‘keys’ for an organization, and that ‘key’ only opens the door of success or profit. So, for an organization to survive in a competitive market, and to increase its profits in an optimum manner, new products or services have to be offered regularly, at appropriate times. Background Drill Power is one such fictional organization, which has good opportunities coming from different quarters. To actualize those opportunities and achieve success, Drill Power like any other organization as discussed above has to launch quality products. Drill Power created a product for waste disposal, and wanted to manufacture it all together and launch it both in the domestic as well as in the international markets. Drill Power was an experienced hand in the production of recycling products, and now they wanted introduce a newer, lightweight product in the same segment. The Research & Development wing of Drill Power had manufactured a prototype and has judged its utility. That is, apart from being light weight, the product has the ability to multitask. “Recognising the growing impetus for recycling domestic waste, the R & D Department of Drill Power has produced a lightweight, economical product to aid waste disposal. The machine is a waste product shredder, which will deal with cardboard, plastics and garden waste such as “small braches” (Case Scenario). And as the Production Manager for Drill Power, our role or job is to suggest ways to restructure the organisation of Drill Power, in light of the launch of its innovative product by formulating a recruitment plan, then we have to formulate a five year financial plan for the effective manufacturing and marketing of the product and finally the marketing plan to launch the product both in the domestic and in the international market. Company structure, Recruitment Plan and Important Decisions The main stakeholder in this case scenario, whose stakes and decisions only forms the crucial component, is Drill Power. The perspective of Drill Power is to achieve good growth and profits by launching a new product successfully. The dilemma for Drill Power arises in the issue of whether to achieve those outcomes, through an ‘in-house’ manufacturing process or go for the outsourcing mode, by getting all the components from outside and assembling it in-house. The solution to this dilemma is going for the ‘in-house’ manufacturing process. That is, as the R&D department had manufactured the prototype, the management can also manufacture the product all together in the company’s premises itself. But, the problems or barriers mainly come in the form of inadequate facilities and under-skilled employees. But, both can be solved by implementing a series of measures. Firstly, the problem with inadequate facilities in Drill Power can be solved by developing an additional facility utilizing an adjacent room, which is under the control of the Drill Power, but which is laying unused. That is, if that extra unused room is developed or furnished with necessary infrastructure and machines, it can be surely used to manufacture the new waste disposal product, in-house itself. “…a firm understands its environment and fashions a response to that environment at the macro level” (Boyacigiller, Goodman, Phillips, 2003). To develop that room and convert into a manufacturing facility, Drill Power has to invest some amount, but that won’t be problem because of the advantages, that will be incurred if the new product is manufactured in-house. That is, benefits or profits of manufacturing the product in-house outweigh the investment that is needed to develop the new facility. ”…there is enough room alongside your existing facility to install an additional facility, which in total will cost about £1 million” (Case Scenario). The other issue for Drill Power that could impede its plan, to manufacture in-house is the inadequate skilled staff. At present Drill Power employs 50 people producing electric drills of both the battery and the main varieties of the waste disposal product. Components are bought in and the workforce is basically engaged on an assembly process for these components. So, there are no employees, who have the needed engineering skills, to aid in the in-house manufacturing process instead of the assembling process. That is, as manufacturing will need optimum skills than the assembling process, there should skilled employees inside Drill Power to successfully come out with the product. But, as that was not the case, it can be only solved by recruiting new staffs and by training the existing staffs. One of the first ways in which organizations can function perfectly is by strengthening its recruiting process. “The best executive is the one who has sense enough to pick good men to do what he wants done” (Roosevelt). Normally, Organizations or its management or its leader will build a working group of employees, by associating individuals who came from the same ‘stable’ like friends, work mates, family members, etc and importantly by recruiting outside individuals, who has very good skill level, knowledge and attitude. That is, as Schein (p.261) said, “... best way to build an organization was to hire very smart, articulate, tough, independent people and then give them lots of responsibility and autonomy”. So, while carrying out this recruiting process, the Organizations should take extreme care to recruit good and technically strong employees. This can be done, if the Organization conducts extensive tests and interviews for the prospective employees, before recruiting them. This will be done in the case Drill Power. That is, Drill had to recruit new employees who are strong in technical skills, and equipped to handle the new product. So, Drill Power can go for in-house manufacturing by firstly recruiting more technically skilled employees and apportioning them into teams. “The Company has generally organized itself into multi-skilled teams to develop projects” (Grant). Even while recruiting new staffs, Drill Power should not fire the old staffs, instead they should also be given adequate training and can be absorbed in the manufacturing of the new waste disposal product. That is, when the existing or old employees of the organization fall short in their performance, mainly due to any lack of skill and knowledge about the process, they can be trained and equipped with the necessary skill and knowledge. In this competitive environment, every organization will keep on upgrading its product and services, and for that, the employees have to be upgraded first. Likewise, before the ‘greenhorns’ are placed in highly responsible positions, they need to be given necessary training. Drill Power by using the services of existing experienced employees can train the under-skilled existing workers and also the newly recruited groups of workers. An wholesome training will do a world of good for the employees, as they will become equipped skill wise and knowledge wise, and will be able to undertake theirs allocated work with renewed confidence. “Good management consists in showing average people how to do the work of superior people” (Rockefeller). So, by recruiting skilled employees and by training the existing and new employees optimally, Drill Power would have actualized a new company structure and can go with its plan of in-house manufacturing. With every thing (both the technical aspects and the financial aspects) going in favor of Drill Power in relation to the new product, it is feasible for Drill Power to manufacture, market and sale the waste disposal product on its own, without giving the patent to another company. Even though, the competing company offered a good bargain, their condition to Drill Power on not to market under the brand name will dealt a massive blow to Drill Power’s attempt to gain a good market share, strong brand image and resultant profits. That is, even with this innovative product, if Drill Power sells it, they will maintain the status quo without any improvement in its segment Five year financial plan and CPA “A financial plan is the guide through the complex, constantly, changing financial world” (Sestina). There should always be a financial plan or apt accounting information to back up all the strategies formulated by organizations to achieve their targets. “Because the primary role of accounting information is to provide useful information for decision-making purposes” (Williams et. al). Like wise, for Drill Power the financial plan for a period of 5 years would give important guidelines to manufacture its waste disposal product, without any barriers. It would importantly show that this business idea is viable. (Ward). As Drill Power wants to go for in-house manufacturing mode, the costs can be kept at low levels in the longer run. Even though, Drill Power had to invest a lot to refurbish its facilities to house the new manufacturing centre, on the long run, it would provide the benefits. Importantly, this investment, will give the Drill Power the option to avoid the sourcing of components from outside. That is, with their manufacturing facility, they can manufacture all the components and assemble them to create a finished product, and thereby cut costs that will be incurred while purchasing the components. So, by saving on the component costs, and keeping the manufacturing cost of the product to approximately £30, Drill Power in the next five years can get back the investment, made in the new facility. Also, the Sales and Marketing costs, which are estimated to be £100,000 for first year, can be downsized in following years as the product will get visibility and brand image in the market, after one year of marketing. So, after the first year, the finances for marketing can be minimized to maintain just a moderate level of marketing. And taking these factors into account, the selling price of the waste disposal product, domestic version can be kept at low levels in the initial stages, preferably in the price range of £35. For the commercial version, whose production cost could increase to £40, the selling price can be set at £45. The rationale behind this decision is, even though the waste disposal product is an innovative one, it cannot have a bumper or dream opening. Its brand image and market share can be increased only gradually, till then, a margin of £5 will be feasible in the first year of launch. Then in the succeeding years, based on the success of the product and the volume of sales, the price can be increased. So, the financial plan for the Drill Power should be tailored or formulated on yearly basis, with conservative thinking in the first year and broader thinking in the preceding years. “…ready to tailor a financial plan that is right for you- a plan that will allow you to protect and grow” (Cunningham). Marketing plan “A great marketing plan helps you run fast, run smart, and run strong, so you can consistently beat your competitors” (Debelak). The marketing plan for Drill Power could be oriented both domestically and internationally, so that the new product gains visibility and the expected brand image, to beat off the competition. “The purpose of the marketing plan is to translate the positioning statement into recognized and preferred brands.” (Luther). As the product has received favorable enquires from both home and aboard, its marketing plan should incorporate both the home and foreign market. In the domestic market, the product has been received favorably by the Power tool suppliers. “It is felt that the potential for this product is huge in the domestic market alone and initial trials have been very successful and some major Power tool suppliers are very interested” (Case Scenario). These prospective clients in the domestic market can be enticed through media based marketing like Television, Print Ad, etc, which acts as the bridge. “Marketing provides the bridge between an opportunity and a purchase.” (Stapleton and Thomas). Importantly, they can also be marketed using marketing executives, specifically recruited for the job. If the management of Drill Power in consultation with the marketing executives set a goal of selling a specific amount of the new products, they will surely try to achieve it. ”Participation in goal-setting was found to be an effective method for enhancing goal commitment” (Latham, Locke & Erez, 1998). So, Drill Power, with new marketing executives will have to be restructured. Marketing executives will also build a kind of personal relationship with the customers and will surely help to reach the product to the intended customers. Not only marketing executives, other staffs should also be involved in an optimal manner to actualize all the marketing plans. “…give them a clear sense of purpose, an accurate explanation of their personal importance in the running of the organisation, and regular communication about the direction and performance of the business” (HR zone). Conclusion With the formulation and the implementation of a strong financial and marketing plan, Drill Power has a bright future ahead. That is, Drill Power with its manufacturing facility, in-house production and effective marketing, can manufacture and launch its new product of waste disposal independently, without undertaking the outsourcing route. As the in-house manufacturing process would cut down costs and importantly will help to provide a quality product (as the process will be done under the watchful eyes of the Drill management), the product would surely reach the top echelons, providing Drill a larger profit and a larger success. CRITICAL PATH ANALYSIS KIT PIZZA Reference: Boyacigiller. N.A., Goodman. R. A. and Phillips. M.E. 2003, Crossing Cultures: Insights from Master Teachers, Routledge. Case Scenario. Drill Power. Cunningham, G.C. 2004, Your Financial Action Plan: 12 Simple Steps to Achieve Money Success, John Wiley and Sons Debelak, D, 2000, Streetwise Marketing Plan: Winning Strategies for Every Small Business, Adams Media Grant, R.M. AES Corporation: Rewriting the Rules of Management. viewed 19 February 2008 http://www.blackwellpublishing.com/grant/docs/17AES.pdf. Latham, G.P., Erez, M., & Locke, E.A. 1988, Resolving scientific disputes by the joint Goal-setting design of crucial experiments: Application to the Erez-Latham dispute regarding participation in goal setting, Journal of Applied Psychology, 73, 753-77. Luther W.M. 2001, The Marketing Plan: How to Prepare and Implement It, AMACOM Div American Management Association. HR zone. HR tip: Controlling absence, viewed 20 February 2008. http://www.hrzone.co.uk/cgi-bin/item.cgi?id=176289&d=1063 Rockefeller, J. D. 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