BSBMGT608
[Name of the Writer]
[Name of the Institution]
BSBMGT608
Introduction
This report is prepared to clarify and provide a detailed understanding of incessant development/improvement and the managing innovation. The report comprises a deep analysis of the case study about a much-known company which produces toys for children and adults. The company is named as A.C Gilbert. The report further includes some strong theories and concepts which are associated to the conception of innovation management and continuous development. As well as the report covers the strategies of A.C Gilbert regarding mentioned concepts which include their sustainability and performance strategies of the company as well as report trends are determined in the report. Beyond that, the report presents some crucial technological solutions t A.C Gilbert regarding the problems noticed in this report.
Furthermore, this report is concerned with the provision of information for the company which is associated to the usage of fresh strategies and tactics and construction of new technology as well as the basic principles of innovation and management are used in this report. In addition, the cost-benefit and risk analysis of the newly adopted strategy by the company are key points of the report. This also covers the implementation of the strategy and several tactics to be used in the implementation. Detailed information regarding the company and its new strategies and tactics are used in this report.
Executive Summary
Every aspect of A.C. Gilbert has been analyzed in this report such entire organization, its management, operation, other practices and the case study about A.C. Gilbert. The report covers operation of A.C. Gilbert regarding supply chain management, changing trends and performance. Beyond that, the production, innovation and performance improvement practices and policies of the company have been reported. Beyond that, all of the critical reasons and issues have been identified which were the real reasons of failure of the company. As well as in the next phase of the report, several strategies regarding performance improvement, getting success and elimination of possible risks and failure have been recommended. In terms of implementation, several strategies, plan have been developed and advised as well as contingency plan have been established for the company in case of managing any failure in implementation.
Purpose of the Report
The core purpose of the report is to analyze A.C. Gilbert from every perspective. To know the facts which pushed company into trouble. In addition the purpose is to know that what factors are crucial for the companies and what factors were there which brought harsh time for the company. Apart from that, it is also a purpose of the report that how to analyze a company or business, study its operations, know the facts and figure, and recommend strong strategies and tactics for improving business, operations, performance and get succeed in today’s competitive business world.
Key Processes and Systems
Supply chain
The supply chain management is the management of all operations which are taken into action for bringing the products to the reach of end consumers. The process of the supply chain is to transfer the goods or goods from the producers to the final user or consumer. The supply chain is managed by every level of organization to encounter the wants and demands of consumers as well as to move products from the company to the final consumer(s). Proper and efficient management is required for this purpose. The supply chain management which was adopted by A.C. Gilbert includes suppliers, producer and retailers. A.C. Gilbert moves and provides toys to their customers through the use of mention supply chain.
Operating Systems
Operational systems of A.C. Gilbert cover several steps. The activities which are used by the organization to deliver the operating organisms include;
Designs: To design all of the products and toys according to the product which has been intended by the company’s designer. The designs are customized as per the requirements of customers who are kids and adults. As well as the preferences and changes in the choices of girls and boys are also well-thought-out while designing the products.
Planning: The overall planning is made for developing the perfect product which meets customers’ needs and wants, sales of the products (toys) and meets customers’ demands and to achieve them with efficiency.
Buying: The buying step is considered in the operative/operational system to provide the overall planning regarding acquiring raw material and other things like packaging from the suppliers of A.C. Gilbert.
Manufacturing: The overall manufacturing covers the operations of manufacturing toys, their packaging and distribution activities. The operations of manufacturing or manufacturing are covered in the production of the company.
Distribution: Distribution of A.C. Gilbert includes the activities undertaken for storage, warehousing and finally distribution of toys.
Delivery of Product and Service
The Delivery of Product and Service is that wherein all organization delivery of product and services is done by the company. The product and services delivery of A.C. Gilbert is highly efficient because of it on time provision of products and services to the customers. The delivery management of A.C. Gilbert includes planning for product or service distribution and then the final delivery management to make the product available on time for the consumers.
The overall analysis of the systems which the company has used and still used by the company has increased and enhanced the overall company performance. The systems and all of the processes regarding product and service delivery which are provided by A.C. Gilbert have managed the resources and functions for gaining extreme accomplishment.
Measures
Number assessment tools and techniques exist which can be used to measure and asses the process and systems used by A.C. Gilbert.
KRAs: The KRAs raises to the overall parts of the diverse roles and responsibilities. The KRA (Key results Areas) of the A.C. Gilbert comprises the outcomes of the roles and responsibilities of the departments of the corporation which further include attained profit of A.C. Gilbert.
KPIs: The KPIs of the company (A.C. Gilbert) are the actual customers’ satisfaction and the quality of their products and related services.
Performance Review System: The performance review process of A.C. Gilbert offers the overall performance appraisal of the company which are used by A.C. Gilbert to enhance the level of confidence.
Evaluation of Efficiency of New Strategy and Necessary Improvements
There are three key tools through which the performance A.C. Gilbert can be evaluated, which are also mentioned above. The theory of quality management and consistent improvement. There are several tactics and techniques which have been used by the company to empower quality and bring continuous improvement to the company where the continuous improvement means improve daily operations of A.C. Gilbert to bring improvement in operations which improve, product, process and product related services of the company. There is no doubt that the supply chain of the company was enough efficient but the systems used by the A.C. Gilbert for improving performance, the company have to face a loss of more than one billion dollars in 1961-62 which made the company unable to stay. And the compan6y has been sold out to a businessman named as Jack Wrather. Here the company’s performance had not enhanced and A.C. Gilbert survived with lost for more than 6 years.
For having continuous improvement practices, it is extremely important for A.C. Gilbert to adopt the PDCA cycle which will provide and improve the company’s performance as this cycle delivers different steps for completing improvement related steps. The steps of the improving quality involve;
Plan
Do
Check
Act
As well as six sigma tools and total quality management also there for improving quality and performance. But the recommended tools for improvement of quality and keeping consistent improvement is total quality management. The company use the tool of TQM for improvement and quality enhancement. The most useful strategy to improve the quality of the products of the company is the customers’ satisfaction strategy and analysis of customers’ satisfaction.
Analysis of the Variances and the Result Areas of Performance Up To 1966
A.C. Gilbert increased the production of new 50 toys which result to increase up to 307 lines business. The production and designing of the firm have changed to ranges for school children (6-17 years aged) from the traditional boy’s designing. The producing elements of the firm have increased with 55 new lines where the year of 1963 has been found a poor period of designing because of lack of innovation in the products. While in 1964, the quality of producing toys has been decreased and the company started using weaker parts. Afterwards, the company has not brought any innovation till 1965 and face a huge loss in the year of 1966.
In the year of 1961, the accumulated loss of A.C. Gilbert is marked as $20,011 while it has increased and reached to $281,000 in the next year. As well as the profits of the company faced decreased in the next years till 1966 which create huge trouble for the company.
During 1961-66, A.C. Gilbert lost its supply chain and delivery performance. The supply of A.C. Gilbert was efficient till 1962 but after the lack of innovation and financial loss, the supply of the company got affected as well as demand has been affected too. Plus, the overall operations and performance of the company have been affected because of the reduction in profits.
In terms of staff, the turnover increased as well. The new owner has changed a huge number of staff members each year and many changes in staff have been brought by the new owner. The top management and bodies of A.C. Gilbert were also changed which has been found an increase in staff turnover and performance of the company.
Changing Trends of A.C. Gilbert
Changing trends means continuous improvement in performance on an ongoing basis. In the year of 1950, the company (A.C. Gilbert) has not introduced any changing trend like innovation in toys. For being highly competitive, the organization needs to have strong changing trends.it is important to get success in the market and gain customers.
Before and after 1960, A.C. Gilbert has certain key strengths and crucial weaknesses.
Strengths
Before 1960, the business had huge amount of market share which was the core strength of A.C. Gilbert over competitors.
The company had a huge reputation and high-quality products to launch.
The continuous increase in the earnings and profits ad market share of the company for some years.
Continuous provision of the increment of the company in the sales.
Highly efficient production and manufacturing as well as continuous innovation in toys until 1961 than any other rival in the industry.
Weaknesses
Weak stability intends and performance of the overall operations.
Lack of persuasive image and nature which led to weakness in adopting changes promptly.
Weak in meeting customers’ needs and expectations as well as poor customer services.
The lowest rate of innovation in some specific years out of this period.
With the changing financial position of the company, the performance of employees was becoming weaker in that period.
Technology Opportunities (Missed)
There are number several opportunities which have been missed by A.C. Gilbert which includes innovation, competition and adopting change.
In terms of innovation, the company always used the same patterns for both boys and girls and didn't work to bring innovation. The major products of the company were dolls and traditional boys while A.C. Gilbert kept the focus on it all the time. In competition, a number of new toys have been launched in the market which became a reason of failure for the A.C. Gilbert’s strategy. In that time, Barbie doll and race cars gotten attraction of kids, as well as new design and different varieties, could be the potential opportunities for the company.
Action plan
Actions
What to accomplish
Days Needed
To analyze innovation or change
Advanced methods
0.5 month
Analyzing the competitor’s innovation.
To deliver better excellence and designs
0.25 month
Computing the financing required for innovation.
Profit edge
0.66 month
Approximating the required raw resources/material.
Raw resources/material
0.5 month
Cooperating the modernization and techniques
Advanced designs and technologies
0.5 month
change implementing
Appropriately implementation of innovation
25 days
Recommendation If the Company Runs
For improving the business and enhance the level of profitability, A.C. Gilbert needs to ensure the adaptation of new technologies and capture the potential opportunities. The important consideration of potential opportunities involve;
Internally, the engineering of the company is required to adopt new technology to manufacture the toys efficiently as well as the department and engineers have to adopt the quality improvement management practices like TQM. Manufacturing should work on improving production processes and operations. As well as sales and marketing professionals should work on customers’ satisfaction. Beyond that, Human resource management should improve employees’ performance and decrease the turnover rate.
In terms of external improvement, the outside consultants should be marked highly valued by the company. As well as A.C. Gilbert needs to use the expertise of outside marketing experts and utilize them for increasing the sales and enhancing marketing operations. In the innovation, the IT consultants and A.C. Gilbert should provide all and accurate info so that better decision will be made and related activities will be done more efficiently.
Task No 2
Performance Improvement Strategy
The strategy regarding performance improvement is to improve the company’s strategies. The strategies and tactics which enhance and improve the overall performance of A.C. Gilbert.
Strategic Goal/Objective
First of all, the company should identify the opportunities and problems or threats. The strategic goal of the company is the set objectives which A.C. Gilbert wants to accomplish at the end of the coming financial year. The strategic objectives of the company;
To make sales of $20 million in 1963.
To gain a huge profit and make huge sales.
Replace some employees and retain the efficient ones.
To improve promotions and introduce more products
Proposed Process and Amendments
The proposed process of the company covers designing, planning, purchasing, producing and distribution. So the company should add marketing and advertisement to their proposed process which will make the company able to be more efficient and profitable. By having a competitive product at hand, the company can increase customers’ satisfaction, so A.C. Gilbert needs to work on and bring highly competitive products to the market. As well as the marketing department should be trained and motivated to make more sales and do effective marketing. Beyond that, the product manager must ensure product quality, product management, control cost, and check the quality. So that the company would be able to have a competitive product.
Beyond Proposed Process and Amendments in Process, the company also needs to develop;
Management brief and consultation
Lead Sessions
Group suggestions
Develop creative techniques and tactics for improvement.
Problem Regarding Implementation of New Strategy
There are highly crucial challenges and issues exist when implementing a new strategy. They might affect the strategy and implementation of inversely. These challenges maybe;
Excessive expenses and costs
Increased competition
Complex processes
Possibility of reduction in revenues
Accepting Success and Failure of Ideas
In case of having a prosperous indication and strategy, the company enjoys revenues and improved performance but the company must have contingency plans in case of failed strategy. This plan includes some crucial parts which are;
Strategy’s Risk Analysis
A strategy risk analysis is the process of assessment of the associated risks with the implementation of a innovative approach by the company. So the company also has to consider risk analysis strategy which would include the following steps.
Mapping the Strategy
In this, the management of A.C. Gilbert must state the company’s objectives, mission and vision to provide accomplishment set by the company. In this, the economic and other perspectives should be considered by the company while focusing on the customers, growth, processes and operations of the A.C. Gilbert when defining the actual goals and mapping strategy.
Risk Identification
After mapping the strategy, the next step is to identify the risks. The perspective of customers, processes and growth would be considered while identifying the risk of the strategy.
Risks Assessment
Assessing the risk means to assess the risk and know its impact on the company and its performance. This is done identifying the risk. The risk assessment covers the steps like risk mitigation, avoiding the risks and accepting them.
Design Risk Control System
A proper and effective designing must be there to control the risks. There are several risk control systems which can be used by A.C. Gilbert. Some of them are; boundary control, diagnostic control and internal control.
Cost-Benefit Analysis of the Strategy
The cost-benefit analysis of strategy is a system where the management decisions are analyzed. These analyses are done for the purpose to know the key strengths and weaknesses of possible alternatives. It provides A.C. Gilbert with the utilization of cost and benefits of the product or service. The cost and benefits of the new adopted strategy are the performance of the strategy as well as an enhanced level of risks.
The cost and benefits of the new adopted strategy is it would provide advertisement, marketing and promotion department to empower and improve its performance and operations and enhance the profitability of the company but it would also a reason which would increase the costs and would make the structure and processes more complex. It would also be increasing the competition for A.C. Gilbert as well as it would help the company to enhance the number of customers.
Importance of Gaining Approval of Innovations through Agreed Organizational Processes
Gaining approval of innovation through the agreed organizational process is very crucial and important for every organization. For A.C. Gilbert, it would help the company to adopt any strategy regarding innovation in products or operations with having proper approval of the management. As well as it is important because you would not have any issues or problems when implementing any innovation when you have gained the approval of innovation with the agreed organizational process.
Task No 3
Implementation
Examination of all Aspect of New Process
The concern of the production manager of the company (A.C. Gilbert) is to plan the new process and implement for the purpose to enhance the productivity, reduce wastage and empower sustainability of the company. It will also be helpful to reduce the possibility of errors. The plan of the manager is to increase the specialization and expertise in the company. Another crucial goal or concern of the production manager is to reduce the rate of turnover as well as to enhance the employees’ performance and decrease the costs and expenses associated with the selection and recruitment of the employees. As well as he has the concern to decrease the costs and expenses regarding employees’ training and development.
The overall concern and planning of the manager would enhance the level of productivity, decrease the possibility of errors which would have a direct and positive impact on performance and productivity. The actual plan is to divide the staff members into different five teams. Every team would work under the expert of the particular field or department as well as every team will be assigned with a target which they would achieve. It would enhance productivity and increase quality. There, the possibility of errors would also be decreased like from 27% to 55 while productivity would get increased up to 40%. Beyond that, the staff members would also be trained and developed which would also be a positive contribution.
Costs
This entire plan costs much as the progressive predictable cost is up to $150,000. Here the cost of implementation is $70,000 while the cost of re-machining is aro8und $1.2 million. The ongoing cost for the company would be $150,000. As the company accomplish savings from this plan, the plan has been found effective and well efficient.
Development costs
Initial trial
$150,000
Implementation costs
Re-tooling the production line
Training
Loss of productivity
$1.2 million
$20,000
$50,000
Ongoing costs
Initial errors and reduced productivity
$150,000
Anticipated Savings
The saving also has part of savings from employees’ turnover which is $300,000 annually while 1 million is from errors and issues and lower productivity as well as $200,000 is from repair costs and servicing annually.
Benefits and Fears of new Process to the Company
Benefits
It would improve in morale
Would enhance the contribution in the decision-making process of the company
Concerns
Employees would be bored by working on single lines
Absence of education regarding specialized skills and knowledge
Productivity reduction because of higher transition
Action Plan for Transition
Actions
Goals
Measures
Deadline
Process implementation
New process implementation
Keeping worthy operational environments
1 month
Sustainability enhancement
Allocating new professionals on responsibilities
Utilization of best source
0.33 month
Reduction of negative impact on individuals
To eliminate errors
Improvement of the process
1 month
Action Plan for Communication
Activities
Objectives
Measures
Timeframe
Process implementation
Provision of execution of communication systems
Improvement of the process
0.66 month
Sustainability enhancement
Communication enhancement
Improvement of the process
0.33 month
Reduction of negative impact on individuals
To improve actions of communication
Improvement of the process
0.66 month
Contingency Plan
The possible problems that may happen during execution stay to eliminate the mistakes and to deliver the best communication structures set-up. The effective execution of these strategies may decrease the occurrence of possible errors/faults while enhances communication plans. In the contingency plan, the A.C. Gilbert should consider the major two activities which tolerate the hazard. The decrease of the occurrence of errors should be managed through the efficient training and development of the employees and staff members. All of the staff members should be well trained and developed for the application of the new process to decrease the possibility of errors. The specialist or concerned expert can improve the errors but cannot be improved by others in the company if they have not been well trained and developed regarding errors management.
Another contingency plan which would be utilized by the company for implementation of various communication systems is the provision of proper and effective enhancement and empowering the communication system in the company. For this concern, the company is required to make payments of enough costs and related expenses because the installation of various communication systems may cost the organization higher. The contingency plan is crucially important for the company of every organization to minimize the costs and expenses as well as to provide highly efficient communication in the company.
How long the company do or operate without?
Effects of doing without.
Contingency in case of Calamity
Decreasing the occurrence of errors
30 to 40 days
The efficiency of the company will be impacted and the results or outcomes would be poor.
Needs and take much enough time from the client to finish up the project after correcting it from all aspects.
Systems set up of Communication
30 days
The confusion, issues and higher repetition may have occurred which could also create huge and crucial disaster in the overall process.
The inefficient activities and work and product or service can be taken risk for maximum 30 days after that no contingency is there.
Follow Up
Examining the Problems, Issues and Failure of the Implementation
The following issues and failures regarding the implementation of the newly adopted process cover below assumptions. The problems or issues that may occur in two months of the implementation are;
The decrease in productivity by 8 per cent
10 per cent increase in the wastage
Delays have increased up to 10 per cent
Resignation of more 15 employees
Issues and complaints of the employees regarding the difficulty in managing the machines
Poor training provides no professionalism
Bored staff members because of working for longer shift timings
Increase in the injuries of employees.
A number of major concerns exist here which have the capability to affect the people to destroy the new process of implementation. The more number of hours beyond shift timing or hours can risk the employees' life because of tiredness which may put an impact on their health. The decrease in production and increase in wastage can increase the costs and expenses for the company. The possibility of employees' injuries may also be increased because of using machines by untrained employees. Complaints increase the employees' turnover and this can also be increased. These concerns or problems have an impact on the company to set up a new implementation process.
Changes in Action Plans
Action Plan for Change
Actions
Goals
Measurements
Deadline
In occasion of failure
Process implementation
Implementation of the new procedure
Upholding fine efficient working settings
1 month
2 months
Sustainability enhancement
To assigned new experts and specialist with duties
Best resource utilization
0.3 month (10 days)
0.6 month (20 days)
Decrease negatives effects on employees
To decrease the occurrence of errors
Process improvement
1 month
2 months
Action Plan for communication
Actions
Goals
Measurements
Deadline
In occasion of failure
Procedure implementation
To deliver the actual execution of communication systems
Improving the procedure/process
0.6 month (20 days)
1.3 month (40 days)
Enhance sustainability
Communication enhancement
Improving the process
0.3 month (10 days)
0.6 month (20 days)
Decrease negative effects on employees
Enhancement of communication activities
Improving the process
0.6 month (20 days)
1.3 month (40 days)
Contingency Plan
How long the company do or operate without?
Effects of doing without.
Contingency in case of Calamity
In case of failure
Decrease of Errors
30 days
The efficiency of the company will be impacted and the results or outcomes would be poor.
Needs and take much enough time from the client to finish up the project after correcting them from all aspects.
Alternate plan will be developed and used
Setting up the communication system
30 days
The confusion, issues and higher repetition may have occurred which could also create huge and crucial disaster in the overall process.
The inefficient activities and work and product or service can be taken risk for maximum 30 days after that no contingency is there.
Alternate plan will be developed and used
If the contingency plan of the company gets fail then the company would not have any other plan at hand but the company will be required and would develop alternate plan and will be using it. As well as company can also d it from the very first step again which would give an option to the company to implement the entire work and plan again.
Evaluation and Continuous Improvement
Continuous improvement and evaluation means analyzing every aspect of work and activities. The competition among work activities give the evaluation to the company which further provide the organization with the effective evaluation. Evaluation and continuous would make the company to have fine, correct and successful future.
Schedule
Activities Evaluation
Frequently Repeating Over Time
To gain learning from work and activities
After each month
Learning application into the work process
Daily if easily possible
Conclusion
It has been concluded from the report that every organization need proper management of its resources and other aspects. A.C. Gilbert was required to consider all of the points which would be used to provide fine and efficient management to such branded company. The weak management, wrong use of resources, poor employees’ performance and lack of innovation decreased sales and productivity of A.C. Gilbert and weaker the performance. As well as ignorance of improvement and innovation in production gave a tough time to A.C. Gilbert where the company faced a difficult situation during 1961-1966 and the company gone closed in 1967 because of huge and continuous loss. This report pointed out key factors which the company had to consider to get succeed in the harsh time. For effective improvement, A.C. Gilbert should consider the action and contingency plans given for the strategy and process which would improve the company’s working and overall performance.
Appendecies
Exhibit 1:
Exhibit 2:
Exhibit 3:
End Notes
Anantwar, Swati G., and Rajeshri R. Shelke. "Simplified approach of ANN: strengths and weakness." Int. J. Eng. Innov. Technol 1, no. 4 (2012): 73-77.
Arzu Akyuz, Goknur, and Turan Erman Erkan. "Supply chain performance measurement: a literature review." International Journal of Production Research 48, no. 17 (2010): 5137-5155.
Oke, Adegoke. "Innovation types and innovation management practices in service companies." International Journal of Operations & Production Management 27, no. 6 (2007): 564-587.
Bessant, John, and Sarah Caffyn. "High-involvement innovation through continuous improvement." International Journal of Technology Management 14, no. 1 (1997): 7-28.
