Root Cause of the Problem Identified in PEW
The case study that is taken for this report is PEW (Precision Engineering Works Private Limited). This company is a company for equipment manufacturing and is specialized in moulding the plastics. The equipment that are made by PEW is done mainly for the tele-communication industries (Agrawal, Panigrahi & Subbarao, 2017). The company of PEW is serving the industry for about 30 years. The customers of PEW is mainly from the tele-communication sector and gives contract to PEW for supplying the equipment. This company is a successful one in the sector of tele-communication.
For mitigate this issue, senior management of PEW decided to implement some serious steps to solve those issues. They are deciding to implement all the ways that improves situation of the company. The management of PEW wants to gain back all their reputation in the market and get contracts from the suppliers. All the ways by which the situation of the organization can be improved is to be implanted in the organization. The issues that are faced by PEW are to be overcome by all management system within three months. This report states all the main problem that PEW experiences while dealing with other companies and in the market place. This report also states all the tools and techniques that will be needed by the company to overcome its situation. This report also states continuous improvement to ensure the problem and also address the issues that might help PEW in preventing the issues so that they can appear again. The competencies related to the company are also elaborated in the following report.
Root Cause identified by PEW:
The main reason for problem that is identified by the tele-communication equipment making company is the increasing number of competitors in the market. PEW wants to make the quality of the equipment better so that they can face the competition in the market (Chen et al., 2016). The main problem that arises in PEW is that the company is losing its market because of its increased price and low quality of products. The impact of market on PEW is that the customers are not ordering the equipment from PEW and the company is not getting contracts. As a result, the company has decreased its profit percentage to 45 % as all their customers are moving to other companies who provides quality equipment with reasonable price. Most of the customer of Pew were from the tele-communication sector. The tele-communication sector also were not buying products from PEW. So, it was becoming impossible for the company to hold the market.
There is another problem that persists in PEW. The employees who works in PEW are migrating to other companies seeing the market reputation of the PEW (Geerling, Chernofsky & Pratt, 2014). As PEW is facing loss in its business processes, the company is unable to provide its employees with benefits and motivation which might sustain them in the company. The company is not able to give benefit to their employees which other companies were providing. For this reason, the employees were moving to other companies for getting own benefit. The main problem that arises in the company is that it is facing many competition in the market and PEW has become a non-gaining company. With the new trend, there are many suppliers coming up in this particular equipment making sector and PEW is facing a tough competition (Fairhurst & Connaughton, 2014). PEW is not getting contracts from the customers because of low quality of product and high price. The profit percent of the company has decreased to about 45 %. There are many other problems that are faced by the company (Harrison et al., 2016). Their employees are also flooding from them to other companies who are providing better opportunities for the employees. As a result, the company is also facing lack of manual power. This is resulting in losing the market value.
Tools and Techniques that are to be used by PEW:
Continuous Improvement Plan
For addressing the problem of improving the quality and lessen the price of equipment. The tools and techniques that can be used are Definition of Quality, Shewart Cycle and CoQ (Cost of Quality). The Definition of Quality defines the quality of the equipment that are produced by the company (Holloway, 2015). As the quality of the products produced by PEW are decreasing day by day and to increase the quality of equipment that are produced by PEW. The customers involved with the company mainly detects the product quality and if the customer rating is not good, then the quality of product is really low (Buechler et al., 2015). The customers are migrating from the PEW to other companies for getting the equipment. Using this technique, the company can increase its equipment quality. There is another technique which includes Plan, Do, Check as well as Act that can be implemented in the company (Booth, 2015). This technique is known as the Shewart Cycle or the Iterative Cycle. There are another technique that can be used for mitigating the problems associated in the company. The tool of implementing Cost of Quality (COQ). This helps to mitigate the cost of Internal Failure or some external failure at the project execution.
For addressing the second problem that is identified by PEW comes from tele-communication industries. The tele-communication industries needs equipment making company which is increasing number of competitors in the market. PEW wants to make the quality of the equipment better so that they can face the competition in the market (Alarcón, 2014). The main problem that arises in PEW is that the company is losing its market because of its increased price and low quality of products. The impact of market on PEW is that the customers are not ordering the equipment from PEW and the company is not getting contracts (Adams, Tenney & Pew, 2017). As a result, the company has decreased its profit percentage to 45 % as all their customers are moving to other companies who provides quality equipment with reasonable price. Most of the customer of Pew were from the tele-communication sector. The tele-communication sector also were not buying products from PEW. So, it was becoming impossible for the company to hold the market. There is another problem that persists in PEW. The employees who works in PEW are migrating to other companies seeing the market reputation of the PEW (Lee et al., 2014). As PEW is facing loss in its business processes, the company is unable to provide its employees with benefits and motivation which might sustain them in the company. The company is not able to give benefit to their employees which other companies were providing. For this reason, the employees were moving to other companies for getting own benefit.
Assumptions made:
The assumptions that can be made to address the problems are described below:
- The official management in PEW should implement all the above stated tools as well as techniques that will be needed in reduction of the cost of the equipment and can also help in reducing the cost of product.
- The quality of the product is mainly reviewed by a customer and the company is losing its market as it is unable to give quality product to its customer. The quality of the management is needed to be implemented in business process in the business process of PEW. They needs to Plan, Do, Check, as well as Act process in the organization (Head & Alford, 2015). This cycle process is commonly known as Iterative cycle. Cost of Quality technique can also be used for mitigating the issues in PEW.
- All the data that are connected with the company are to be present in the company. The company must know where the problem lies and how to mitigate those problems. For recommending the company about what can be done, a fish bone structure is provided that helps to mitigate the problem of PEW.
- One last assumption that is stated for the company is that all the data related to the customers in the company are to be given to the employees of PEW (Hammer, 2015). This is done to get the feedback from the customer which is needed mostly for improving the business process.
Problems Identified
On analyzing of the case study, the problems that are identified are stated below:
- PEW wants to make the quality of the equipment better so that they can face the competition in the market. The main problem that arises in PEW is that the company is losing its market because of its increased price and low quality of products. The impact of market on PEW is that the customers are not ordering the equipment from PEW and the company is not getting contracts (Holweg & Maylor, 2018). As a result, the company has decreased its profit percentage to 45 % as all their customers are moving to other companies who provides quality equipment with reasonable price. Most of the customer of Pew were from the tele-communication sector. The tele-communication sector also were not buying products from PEW. So, it was becoming impossible for the company to hold the market.
- The production cost of the company also increases because of old technologies that are used in the company (Liu et al., 2017). The companies who are in competition with PEW use new technologies that makes the production at low cost.
- The employees who works in PEW are migrating to other companies seeing the market reputation of the PEW. As PEW is facing loss in its business processes, the company is unable to provide its employees with benefits and motivation which might sustain them in the company. The company is not able to give benefit to their employees which other companies were providing. For this reason, the employees were moving to other companies for getting own benefit (Peerally et al. 2017). The main problem that arises in the company is that it is facing many competition in the market and PEW has become a non-gaining company. With the new trend, there are many suppliers coming up in this particular equipment making sector and PEW is facing a tough competition. PEW is not getting contracts from the customers because of low quality of product and high price. The profit percent of the company has decreased to about 45 %. There are many other problems that are faced by the company.
Actions Taken
The actions that can be taken for the problems that are identified are stated below:
Technical Actions
Technical – There should be a proper technical set up for manufacturing the products that must be upgraded from time to time to produce better quality of product.
Business – The company should ensure that their customers that they are provided with the best quality of equipment with reasonable price and with best quality of work (Lee & Olson, 2016). Marketers should emphasize on implementing marketing moves so that they can gain new customers.
Strategic – The strategy of the company should also be improved which consists of all the internal operations involved in PEW. They also needs to find out the reason for the employees leaving the company and how the employees can be provided with more benefits.
Resources Required
The following resources are required for improving the business process in PEW.
Technical Upgrades – The systems that are included in the business process of PEW are always to be upgraded so that processes are done in an updated from (Shokri, Waring & Nabhani, 2016). PEW also needs to buy all the equipment that are needed to make the system smooth.
Payroll System – The wages of the employees are needed to be upgraded as the employees are resigning from the post in the company. The benefits of the employees are to be kept in mind and they should be flexible with the employees.
Business and Strategic Management
For addressing the second problem that is identified by PEW comes from tele-communication industries. The tele-communication industries needs equipment making company which is increasing number of competitors in the market. PEW wants to make the quality of the equipment better so that they can face the competition in the market. The main problem that arises in PEW is that the company is losing its market because of its increased price and low quality of products. The impact of market on PEW is that the customers are not ordering the equipment from PEW and the company is not getting contracts. As a result, the company has decreased its profit percentage to 45 % as all their customers are moving to other companies who provides quality equipment with reasonable price. Most of the customer of Pew were from the tele-communication sector. The tele-communication sector also were not buying products from PEW. So, it was becoming impossible for the company to hold the market (Wasson, 2015). There is another problem that persists in PEW. The employees who works in PEW are migrating to other companies seeing the market reputation of the PEW. As PEW is facing loss in its business processes, the company is unable to provide its employees with benefits and motivation which might sustain them in the company. The company is not able to give benefit to their employees which other companies were providing. For this reason, the employees were moving to other companies for getting own benefit.
There should be proper management of the employees who are involved in the system of PEW. There should be proper leadership competency in the company (Vidyasagar, 2016). All departments are to be maintained properly with a proper leader. The problems that are faced by PEW mainly lacks in leadership quality where all the employees are to be lead. There should be a strong relationship in between the employees in the company.
Business Actions
Conclusion
The main problem that arises in PEW is that the company is losing its market because of its increased price and low quality of products. The impact of market on PEW is that the customers are not ordering the equipment from PEW and the company is not getting contracts. As a result, the company has decreased its profit percentage to 45 % as all their customers are moving to other companies who provides quality equipment with reasonable price.
It can be concluded that for mitigating all the issues that are involved in PEW, the senior management of PEW decided to implement some serious steps to solve those issues. They are deciding to implement all the ways that improves situation of the company. The management of PEW wants to gain back all their reputation in the market and get contracts from the suppliers. All the ways by which the situation of the organization can be improved is to be implanted in the organization. The issues that are faced by PEW are to be overcome by all management system within three months. This report stated all the main problem that PEW experiences while dealing with other companies and in the market place. This report also stated all the tools and techniques that will be needed by the company to overcome its situation. This report also stated continuous improvement to ensure the problem and also address the issues that might help PEW in preventing the issues so that they can appear again. The competencies related to the company are also elaborated clearly in the report stated above.
References
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