Describe the present of situation of the company, and the main reasons that causes the problems.
3J Tech Company now is faced with high percentage of sales drop and huge amount of its customers complaining. The situation is overwhelming because the customers have been asking not to continue the contract with 3J Tech, and turn around to do business with its competition. Therefore, this results that the company is losing its market share and reputation in the market. All of these problems are occurred is because of its product with poor quality. Moreover, the main reasons that causes “poor quality” of the product are its inefficiency and inefficient material, people, production of technology, and management style.
Introduce the company’s history and the principle of business and its environment such as its competitors.
3J TECH Corporation was found in 1984, and the CEO is wenj Huang. The company’s main business that is involving in computer network products such as Fax Modem, PCMCIA Cards, Tel Talk etc. Actually the company was doing well in the beginning because of its sales and marketing ability. However, because of Huang’s management style, it has been destroyed the company’s performance. Huang asked the employees must work hard to the company but he did not take care what the employees’ need; for example, the employees in sales department asking for sales commissions that was totally ignored by Huang. The same situation also happened to the engineering department asking for the need of experts to support the performance was not concerned by Huang. In addition, Huang slashed costs and funneled the cash to other enterprises in which he was involved. Needless to say, 3J Tech members despised him. When the time went by, the employees lost his or her enthusiasm to work for the company because of largely unresponsive to worker concerns. Therefore, the quality of the product went down because the employees did not work hard as before. Then, it results the order went down. When the company received more complaining of poor quality from its customers, the only thing Huang did was to put a lot of pressure on the managers of each department.
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Alan Guo, who has so many working experience in sales and marketing, the manager of sales department has no moral in malpractice. Kiwi Huang, who was hired with high salary from Wenj, the manager of production department and he was the senior engineer form one of most famous TECH corporations. Basically, he obeyed to Wenj’s order, and he followed Wenj’s management style. Peter Zhuang, who has professional knowledge in technique of research and development, the manager of engineering department. The managers then blamed all these problems on the workers; therefore, it caused high turnover rate in the company. In contrast, Huang did not feel bad because of employees’ often resignation because he believed he could always hire the employees who have more loyalty to the company. When the new employees come to the company, they won’t work hard to the company because of the company’s culture tell them that “you gain not thing from the company even though you work very hard for them; the only thing you will have is a lot of blaming.” Therefore, the employees won’t stay longer than two years on average in the company.
Actually there are more than 100 organizations which are doing the same business like 3J Tech in the market. Comparing with its competitors, the company is considered as young and developing company in this market. Therefore, in order to gain the market share, the company’s strategy was to offer cheaper price than its competitors to the customers.
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As a new CEO, give my assessment of the situation in global. Use fish bone to analyze the main reasons that causes poor quality of the products.
Eventually Wenj Huang was forced out because his poor management style resulting the company’s poor performance, but Huang era left deep internal organizational wounds. Jing-Wen Hsieh, the new CEO, who came to the company after Huang left. Hsieh finds out that the company’s sales go down dramatically is all because poor quality of the products which resulted its customers replacement, and she realizes that if she wants the company’s business back, “quality” of the product is the key. However, in order to know how to improve the products’ quality, she must first analyze the main reasons that cause poor quality the products. And they are poor management style, unhappy employees, unprofessional technology and inefficient and inefficiency material.
What surprised her is that Huang’s management style left the organization with serious internal problems. There are no effectiveness communication channels that established in the company; there are no open communication and extensive information sharing in the organization. Therefore, it resulted the employees of each department worked on their own, and they do not have general knowledge and information what others department does. The organization’s system, which means its organization of processes, does not consider each process should not only complete in itself but also need to work together. This came out obviously that there is lack of cooperation in the environment. In addition, there is lack of committed leadership through the organization. Needless to say, the managers or supervisors are less caring to the employees. Of course, this poor management style directly affects to the employees in the organization. Hsieh find out that the reasons why the employees are unhappy to work in his or her job is because they are lack of support and lack of training, when the problems occurs. Moreover, there is lack of trust in the organization. Most of employees are afraid to take responses and to make mistakes because there were only blames not rewards.
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The employees do not see their future if they continue to work for 3J Tech Company. Therefore, the organization’s employee turnover rate is extremely high. According to the organization’s culture, when the new employees come to the company, they won’t work hard for the company because the environment clearly show that they gain not thing from the company even though they work very hard for 3J. Moreover, the more ideas they contribute the more responsibilities they have. If the things are not going well, the only thing they would have is a lot of blaming. Therefore, the employees wouldn’t work for the organization, and they treated 3J Tech company as a training institution or their springboard for next job. As long as they attain they need, then they leave the company. Mostly the employees will not stay longer than two years on average in the company.
At the same time, Hsieh figure out that the organization foes not build up the good relationship with its suppliers. There are two reasons result this bad relationship with its suppliers: the first one, the organization often delay the payment to it suppliers; therefore, it causes that the suppliers are not willing to do business with the company. Moreover, the second reason is that the company does not range the purchase timing, and it results the suppliers could not deliver the material on time. Therefore, it then affectes the company’s production line which somewhat needed to stop producing the product until they received the materials. Moreover, because the company’s strategy was to offer cheaper price than its competitors to the customers in order to expand its market share, therefore, most of components of the product were offered cheap prices by the small and low technical suppliers. In addition, there are no long term partnership with its suppliers because the company often changed the suppliers, when they found out other suppliers which could offer them even cheaper prices of materials than their current suppliers. This changing around suppliers which caused high degree of chance to buy incorrect quality of the materials.
Furthermore, Hsieh also realized that production department and engineering department were lack of the professional technology. This not only caused more chance of deviations that occurred in the process of production, but also prevented research and development of the product. Moreover, there were poor equipment maintenance and old equipment existed in production department; needless to say, it easily caused that the products did not have good quality. At the same time, there was lack of experts in production department and engineering department to handle the work. Only few professional engineer work in these two department, but most of employees did not have professional skill or knowledge. And this often caused more mistakes, then end up spending more time to fix the products.
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Use SWOT analysis to know the company’s strengths, weakness, opportunities, and threats. Gather the additional information which is needed in order to implementing change by survey or past experiences (similar situation) happened to other organizations.
Although she had clarified main reasons that cause poor quality the products, she still needed to analysis what the company’s strengths, weakness, opportunity, and threats because this would help her to understand the company’s internal and external condition. She then found out that the company’s strengths were its marketing and sales ability, and price competition that was lower than its competitor. The company’s weakness were its inefficient production process, high employee turnover rate, poor management style, financial limitation etc. On the other hand, the opportunity was that the company needed to figure out how to reengineer its production process in order to reduce cost and wasting resources. Of course, competitions were the company’s threat.
Moreover, she saw by knowing these information were not good enough to implement change; therefore, she decided to gather addition information from the managers in each department and the employees. She has the inform meeting with these managers and asked them how they think about the company, their perceptive, their suggestion, and what changes they would like to make. Moreover, she uses survey to ask the employees their thought such as what they liked or disliked the company, what changes they would like to see from the company, what they needs are etc. At the same time, she goes through the information which had similar situation happened to other organization in past experiences which gives her more ideas how to implement changes.
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Describe the process of change. (How do I make these changes happen? who needs involved, what things can or cannot control, developing new structure, etc.)
She knows that to persuade informed and demanding customer that 3J Tech is a different company, she has to persuade her own employees. Some of her initial actions are to change the product’s package, remove some products that have outdated in the market, and take away the time clock system out of the company. The purpose of changing the product’s package is to refresh the company’s image. By checking the company’s financial report, She find out that the company has invested in many products that did not contribute profits to the company or did not attract the customers; therefore, she decides to remove these products out of product line. This action will help the company not wasting its resources by only concentrating in certain products that brought profits for the company. The reason why she eliminates the time clock system is because she does not believe that the employee of time clock system can tell the company who does work hard or who does not. In stead of the time clock system, she establishes the humanized working time schedule for the employees. This will somewhat help building trust between the organization and the employees, and it shows that the company does understand the employees may have some inconvenience in some situations that cause for being late or leaving early.
Hsieh also acts quickly to get employees focused on specific targets. Rather than emphasizing generic cost-cutting efforts or zeroing in on simplistic reactions to competitors’ actions, she puts everyone on notice that they would be measured together on what mattered most to customers—the quality of products. Her fist step is to need the commitment from the managers. She tell Kiwi Huang, the production of manager, that she needs his commitment to make the production department working inefficient. She also mentions that she would support his need to help the changes happened; however, there would be a time limit which meant if he does not come out any contribution, he would be laid off by the company. Then, the idea they come out is that changing technology. To get rid of old equipment and introduce the new equipment such as efficient handling equipment, furnaces, and presses have been installed to reduce the cost of manufacturing Modem and PCMCIA cards. Moreover, she also hires some exports to test and fix the process of production in each step in order to decreasing the deviation or error that occurs randomly in production line. In addition, she sent the employees who were involved in the work for technical training in order not to be threaten by the change.
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On the other hand, she found out that there was a lot of wasting resources that caused by incorrect quality of materials. To reduce cost of these wasting resources, she asked the purchasing department to test the quality of each material from the suppliers. She understands it is impossible to improve the product’s quality if the company uses inferior components. Moreover, she tells purchasing department that the way to get the least expensive, best supplier is to work with one supplier for each item in a long-term relationship. She believes that once the company finds the good suppliers and by working together, the organization might find more effective methods to reduce costs for both while the company and the supplier both improve itself products. Moreover, they must range the purchase time and make sure the accounting department gives the payment to suppliers on time.
For the engineer department, after meeting with Peter Zhuang, the manager of engineer department, she then hired more professional engineers to support the department. She also saw how to deign the product by using less material but more functions would be an important issue; therefore, the engineer department must have strong ability in research and develop of products. So, she very focused on engineering updating skills, knowledge, information etc. On the other hand, she thought it was easy to deal with sales department because she knew what bothered them was that the company did not provide sales commissions. After she had the commitment form Alan Guo, who was the manager of sales department, she decided to provide the appropriate percentage of sales commissions in total sales that made by sales person as a reward, but it would not start until the quality of product had been improving. Moreover, she required sales people must not only have a clear understating of the products, but also learn the knowledge of the produce of the product process in order to provide the high quality of customer service.
To emphasize her commitment, she led employees know she will be using the monthly sales report and the survey of customer satisfaction rankings as the company’s new performance yardstick. To make sure employees were motivated to meet these new performance targets. Hsieh promises to pay every employee a separate $40 check in any month the company finishes in above average of rankings. Although $40 check may not seem like a lot of money, the checks symbolize to 3J employees that management is now willing to pay rewards instead of constantly asking for givingbacks.
Moreover, she knows it will take a lot of time to change the organization’s culture. However, she tries to unify people and give them a vision. She wants the employees feel that the company does provide them the future, and the company wins means they win, too.
Address the possible effects of any recommended changes that might effect on other organization units, and how I would deal with these ripple effects (open communication, training, and creating no threaten environment.).
Hsieh knows it is possible the changes she made will affect on the organization units especially each department has been always work on their own; for example, the sales people did not want to get involved in technical support to the customer. Therefore, whenever the customers had any technical problems or question, they send them to the engineer department or production department. Just like her decistion that the sales department needs to learn the produce of the product process in production department. She knows this might cause resistance of the sales department because they think they will need to handle more work that should be other department’s responsibility. However, to make things work smoothly, she clarify her idea to the employees. All she wants is each department can work and support together. How she achieves her want is that she used cross-functional team strategy to make employees work together. And open communication to make sure employees’ perception and attitude. To reduce resistance of the sales department, she provide a series of product technical knowledge for salespeople, and she told them that she does not require they have to become a experts in production or engineer field. She only expects them in providing better service with the customers, and in cooperating with engineering department and production department.
Evaluation of the change program (benchmarking, customer surveys, or TQM-actual results vs. plan).
How can she know if all the changes that she made in organization do improve the organization’s performance? She will determine performance evaluation by quality experts, customer survey, employee survey, employees’ turnover, revenues and market share. Through quality experts, the test will tell whether the company do improve the product quality or not. At the same time, through customer survey to know customer satisfaction in quality of the product. Moreover, through employee survey to know employee satisfaction with the organization after the changes occurred in the company. She believes the changes she made should bring the company’s business back and even bring more revenue for the organization.