Performance Measurement of the Coors - Case Study Example

The Coors Case Vision ment The key points of the Coors vision ment suggest that a) Coors has a history of having visionary leadership. b) They are proud of their products and dedicated people. c) They rely on building up their human, financial as well as physical aspects of the company to produce better products. d) They like to contribute to their neighborhood and are willing to be a good neighbor. e) Must bring in significant change to thrive in the industry Based on the above five important parts of the vision statement of the Coors, we now compare it against the Six Planks as suggested by its CEO in annual report of 1997. The emerging gap which seems to be emerging between the six planks and the vision statement of the Coors is that the Six Planks do not mention how they are going to contribute towards society by being the socially responsible neighbor. However otherwise they strongly suggest a stronger link between the two. First emphasis is being placed on growing financially which will be achieved through building on the physical aspects of the company by capturing new markets, channels, demographics and brands. Coors’s six planks also suggest their closer proximity with it vision statements when they declare that they will continue to improve the quality of their human resource by contiously upgrading their skill levels in order to improve their performance. However there is another gap between the statements where vision statement mentions for bringing in new and innovative change in the industry in order to help them evolve and thrive however the Six Planks do not seems to suggest any effort on the part of the company to initiate any change which can affect the whole industry recipe. 2) A close analysis of the vision statement of the Coors’ Operations and Technology department suggest that they consider their internal business as their own stakeholders with the responsibility to deliver the best and freshest beer while ensuring everything to deliver it in superior packaging at competitive cost. Further the department considers itself an innovative place to deliver quality beer to its drinkers. The department also set learning as one of their vision objectives as each individual within the department seems to be well versed with his work. Further the department also believes in bring in more value to their brands so that they can gain consumer trust. A close analysis of the Supply Chain guiding principles suggests a very closer link with the vision statement of the department and there are very subtle gaps between the two. The only gap which seems to me a major gap is again less emphasis on the social responsibility. The department has probably failed to translate its responsibility to external stakeholders as its guiding principals are silent as to how they are going to effectively play its part in showing responsiveness to its external customers by translating its department which is just not focused on cutting costs and reducing the waste. 3) The gaps in the benchmark performance of the Coors suggest that higher cost may be the main reason behind this deviation from the industry performance. Coors have limited number of plants in US therefore its supply chain management might be costing it higher than the competition. Besides, the CIL project though was initiated but was not fully utilized to take out full benefits out of it. Secondly the performance yardsticks applied by the Coors over the period of time do suggests its inclination towards cost based performance measures. Further the performance criteria as set by the company were not consistent within the organization with having fragmented and inconsistent performance measure being employed in various departments. The automated nature of the plant suggested the Coors was now concentrating on the technological side of the production while completely avoiding its lack of focus on controlling labor costs. The larger chunk of gap in the performance is being reflected in the production stability which is clearly indicating that there is higher number of production halting at the Coors’s plant as it may have to adjust its production capabilities to produce at the optimum level of production besides achieving flexibility in its operations. d) a) Balanced score card can be linked to the incentive plans as it tries to link the performance of the organization with its strategic objectives both financial as well as non financial. b) If the score card fail to show the correct behavior after the implementation, the process have to be repeated unless a coherent measure of performance is achieved. Individual input will be reflected in the overall performance of the department. c) No, it will provide additional flexibility as it first identifies the gap and then allow organization to rectify them to be more flexible in nature. d) true but meeting the expected levels of supply induces you to achieve your targets more faster and provide you an opportunity to be more flexible. e) These methods only provide just one side of the view and do not provide a holistic view of the affairs of the company. f) Since organization runs the whole show therefore all the brands are important as they serve different niches within the market. Just concentrating on production of critical brands may produce cannibalization effect. g) Measuring weekly schedules allow you to better control the production process as it show the level of flexibility in the organization as well as concern for the production process to be seamless and efficient. h) Balance score card will be used to review the performance of all the three plants as its basic purpose is to review the performance of all three plants with each other in order to undertake a study to measure the alignment of performance with the strategic objectives of the firm. I) Yes j) Yes if they significantly contribute towards measuring the performance of the firm. K) The basic purpose of the balanced score card will be to measure the performance therefore the whole cycle involved in the supply chain management will be taken into consideration. l) Performance will be measured on the wholesome basis as individual performances only add up to the group performance. m) The score cards will be updated after a set interval of time. n) No o) The persons at the Operational and technology department will put together the whole balanced score card to be presented to the top management of the firm. 5) Taking into consideration all the gap analysis of the firm as well the current production mechanism at Coors, it is imperative that an operational methodology may be evolved to better address the issue of production. The specific performance measures which can be designed are 1) Reducing load schedule by capping its gap with the benchmarking standards. 2) Increasing the load accuracy 3) Closing the gap between the production stability with the benchmark in the range of 10% 6) Though EVA can be a meaningful measure to include financial performance of the Coors into the balanced score card however there is a need to perform a broader range analysis while performing EVA on Coors. Apart from the adjustments given for EVA in the case, I believe there is also a need to be including other financial parameters into the account so as to measure the EVA in a better and more effective way. On the whole, the company’s objective for implementing the balanced score card system is to align its supply chain management activities with its overall strategic vision and direction. In doing so The Coors intend to obtain a better operational efficiency. The company was facing operational bottlenecks in its production as well as overall supply chain and in order to address this issue, they decided to implement the balanced score card project in the company. Overall Coors seems to be flexible company with its employees well versed with the overall direction of the company. The performance culture, the pride in their historic values and ability of their visionary leadership are three characteristics of the company which has a great impact on the implementation of the balanced score card project. I believe that given the competitive scenario in the market, Coors will be successful if it follows following three recommendations: 1) Focus more on the market rather than on the competition. Know your customer and drive your efforts to delight him. 2) Streamline the production process by improving the lines of communication between various departments. 3) Focus more on value addition in the production process. Read More