Project Management Mechanisms: Case of BIX-FIX Company - Essay Example

Introduction BIX-FIX, plc is a large biscuit company which has not been faring well in terms of competition. It has been experiencing declining sales and increasing production costs due to its outdated production line and ineffective sales and marketing processes. In order to address the situation, BIX-FIX has decided to launch a new product, described as a triangle-shaped individually wrapped, white Belgian chocolate covered biscuit, targeting the luxury biscuit sector. The new product launch will be handled as a project. Definition of Project Business Case The project is to launch BIX-FIX’s new product, which shall be termed Belgian biscuit for project purposes. The Belgian biscuit launch shall be used as the take-off point for revitaliseing sales and marketing efforts, in order to help assure a business turnaround for BIX-FIX. The goals and objectives of the project are: Determine the final version of the new product through product development processes, including test marketing, in terms of standardisation of ingredients, product shape, packaging, and packaged quantities Develop a streamlined production procedure to be able to handle increased production volumes Adequately train personnel in all areas such production, marketing/sales and other necessary personnel Develop a marketing and sales plan to include advertising and promotions, marketing and sales personnel training, and incentive programs Determine whether development of new distribution channels, such as wholesalers, will be feasible and will increase the company’s profit margins Develop a working budget for the launch project and secure necessary funds, to ensure breakeven within 20 months of launch Develop a project timetable that sets the launch date at the 8th month of project start date Launch the new product Monitor launch and evaluate outcomes Project Management Mechanisms Several mechanisms need to be in place to successfully manage the project and help ensure its success. Project management needs careful planning and organising in order to achieve objectives. Aside from defining goals and objectives, there is a need to identify the various tasks needed to be accomplished to achieve the goals, quantifying the resources needed, determining the budget, and defining the schedule for completion. Upon completion of the plan, implementation, evaluation and maintenance follow (Free Mgt Lib 2009). Foremost is the decision of the board of directors in determining the members of the project team and appointment of the project manager and the project board. In the area of Product Development, the proposed new Belgian biscuit will need to undergo a series of trial production runs to be able to standardise quality and quantity of ingredients, biscuit shape and other considerations for packaged food products. In coordination with Marketing, trial production with different specifications for packaging and size also need to be tested. The final product version that will pass the test will also need to be tested to confirm that the design of the new product is compatible with mass production. In the area of Production, as was decided by the board of directors, a new production machine shall be installed to handle increased production arising from the introduction of the new product. The ordering, delivery and installation time of this new equipment should be considered in the Project Schedule, as this is projected to be needed from Year 2 onwards after launch. A new 2-shift working system will need to be adopted compared with the current day only working pattern. This is necessary to handle increased production due to the new products while maintaining production for the existing products. As such, additional workers need to be recruited and trained in company operations, which is the function of Human Resources. In the area of Inventory and Warehousing, suppliers need to be sourced out to provide raw materials or product ingredients. These raw materials would be different from those used for current products as the new product, aside from needing Belgian chocolate is envisioned as a premium product targeting a different clientele from existing ones. Aside from raw materials, materials to be used in product packaging also need to be sourced out from suppliers. And even prior to production of packaging materials, design and style of packaging need to be developed by Marketing. In terms of timeline, the plan is to have sufficient products available and ready for distribution to the sales outlets before the launch. In the area of Marketing and Sales, a new marketing and sales campaign must be put in place to help ensure a successful launch. The specific target market segment for the new product needs to be determined to be able to come up with an effective marketing plan. Other marketing considerations include development of a brand name for the new product, designing product packaging, and determining the advertising or promotions message that will push the new product. A new advertising campaign with television, press and web advertisements need to be developed to create public awareness for the new product. Sales people will also need to undergo training on the new product. In coordination with Product Development, a test marketing plan needs to be developed and conducted to assure all project sectors of a successful launch. Test marketing will include identification of target groups, determination of manner of product introduction, gathering and summarisation of test results, evaluation of test results and recommendations for improvements. Part of the test would be to investigate the feasibility of using new distribution channels such as wholesalers. This will help determine its viability and if indeed, profit margins may be increased through the reduction in sales teams. Moreover, to help ensure a successful launch and continued success after launch, a new incentive program will need to be devised in consideration of the new product which may be deemed more difficult to In the area of Human Resources, recruitment efforts need to undertaken for additional personnel that will man the 2nd shift. Both current and new personnel will also need to undergo new product training and operations training for the new recruits. In coordination with Marketing, sales training need also be conducted for the sales force to be able to get oriented with the new product, its target market and the new marketing message. In the area of Finance, the following cost components need to be considered and included in the operating budget for the product launch: Investment of £2.5 million Cost of new production equipment Marketing costs, including costs of new brand development, design of product packaging, mass media advertising and promotional materials for sales outlets Increased personnel costs Training costs for new and current personnel who will be working on the new product; for marketing and sales people Increased cost of utilities due to the 2-shift working system Per management directive, the budget should be a plan that is able to achieve breakeven within 20 months of launch. Conclusion Projects are limited duration exercises which are undertaken to achieve very specific objectives. Two very important inputs to project success are a carefully developed project plan and the selection of sufficiently capable project personnel from the project manager to those who will manage various aspects of the project according to plan. Upon attainment of the project’s specific goals and objectives, it can be concluded that the project is a success. References Case Resource Free Management Library 2009. Project Management. Viwed 4 June 2009 . Read More