A Company which have 100 people, has just gone into liquidation, being unable to
manufacture furniture of sufficient quality and provide enough to satisfy the
demand for it. In order to solve the problem, we have already thought up a plan.
The bank manager have already accepts the financial and marketing aspects of the
plan, but he is unsure of my management ability and how I would improve the
organisation and management of the collectively brought about the company’s
downfall. So I am now have to reassure him and persuade him that I know not only
how to manage people, but also how to set up and organise appropriate business
For the business problem that we are working with. It is require a range of
skilful and craft workers, So that the aim of the plan is to provide a good
quality and sufficient amount of products. Satisfy the demand for it. Show that
plan to the bank manager, give him a confidence. So that we can borrow this
budget form him then we can put the company on track again.
These are all internal problems within the company; management of workers,
suppliers, costs and budget.
FIRST the workers. Due to the fact that it must have the following problem in
suppliers area. The quality of the raw material must have not reach the standard
that is aimed. For examples: the may ordered some cheap materials or expensive
raw materials where they can have poor quality of work done with the expensive
materials and good quality of materials done by poor quality of work or it could
be the other way round. So it need to reorganise and have real thought about it.
For the problem which just mention can be relayed to the workers. The workers
also have problem in; not happy with their salary, relationship problems between
all workers themselves (neighbour trouble), also not happy with their raw
materials where they are working with.
To solve the problem above I must monitor in depth on the suppliers. Look at
their raw material that they are provided and communicate with the craft workers
and see if the materials are what they really want and what really keen on
working with e.g. a worker may not be happy working with pine wood because he
thing pine wood is not the right raw material e.g. too light or not met
specification for the furniture or some other strange reason and where I must
really consider about his thought rather than just do what I wanted to do.
In other words if I’ve ordered some expensive raw materials, but it still end up
with poor quality of product. There may be a problem something like between the
relationship of workers (neighbour trouble). Some one may have argue with some
body and cause problem with the communication. Other possible case where they
have neighbour troubles are, not happy with their working environment e.g. the
working environment are too cold or too hot, bad air condition etc. These all
have got to be done even those need to cost more overhead. Sometimes workers
will unhappy with the company with sensitive saturation like asking to increase
their salary. So that we must try convince them, tell them the saturation, but
not telling them we are in liquidation saturation. But something like the
quality of our product aren’t good enough at the moment so that we need all of
you to give twice as much as effort to the furniture that you are working with
and guarantee you will have more salary. One other strategy is to set up a
competition for getting a premium salaries race between workers. Also buying
machinery are important for the apposite. That will help the workers do less
work and save their power and energy. We will take action straight away soon we
have got the money. However the workers must be satisfied. And work happily in
their working environment and give them the best morality to let them achieve
their best performance on the products.
Another saturation is where the worker are really not very good for their work
i.e. poor of work which I will go through them, ask them a lot of questions. Or
by employing a supervisor for the responsibility for all workers see if their
really can do the job up to the standard. And if they did really bad things to
the company then sack them and employ new workers. All new workers are going to
be well train before they are going to do the actual job even those they have
lots of experiment in this area.
SECOND the supplier. We must have a good relationship between the company and
the supplier in order to reduce the cost of overhead. For example, order a large
amount of the raw materials, let the supplier make more profits at a time.
THIRD cut the cost. This is probably the most important thing in our case. For
above solution e.g. buying good raw material, machinery, employing supervisor
etc. these all need quite a lot of extra money by the time we have solve the
above salutation. Cost could be cut on the overhead, e.g. the electricity we are
using, administration expenses, factory expenses etc. just any thing that could
be think of but it won’t affect the workers and the products. e.g. salary.
FOURTH the budget. We now gone into liquidation. One of the reason is from the
budget. If this time we can borrow the money from the bank manager. We must have
a budget forecast. A forecast of fix cost must be done in the coming year (a
cash flow forecast) to keep the budget right. We have to think positive. So if
there is a big increase like wood are more expensive in the coming year, workers
ask for more salary, machine down time and the fixing cost are more than what
we thought or any thing on that line. We must first think how we going to attain
more money to match it. A cash flow forecast can be done by Regression by
collecting all raw data. And put all the data into a computerise system. Than we
look at the expenses. And the expenses have got to match. If we have an
incidence next year that couldn’t match the cost. We have to increase the price.
However it is better than nothing.