Operational System Of AC Gilbert Company

Design

Supply chain- The supply chain management of the company mainly deals with the management of delivery of the goods and services of the company to the target customers of the company. The supply chain process of the company can be elaborated with the help of the following flow chart:

Distribution- The distribution process of the company delivers packaged toys to the warehouse of the company for the purpose of storage.

Sales team- The sales team of the company focuses on taking order from the customers and clients of the company.

Distribution- Arranging for the delivery of goods to purchase by utilizing the contract transporter.

Retailers- The retailers sell the final product of the company to the target customers of the company.

Operational System- The complete operational system of the company which consists of various processes is as follows:

Design: The toys of the company are designed by various small groups of designers who focus on developing concept of the products of the company.

Planning- As opined by Daniels & Greguras (2014) the planning department of the company helps in translating the concepts of the company into designs and estimates the requirements of resources including the raw materials. The planning department of the company also helps in projecting sales and also helps in developing the production plans for each product of the company, timeframe of the production process and schedule of the production processes.

Purchasing- The purchasing department of the company utilizes the information gained from the planning stage used to purchase raw materials for the products and also purchasing packaging materials from the suppliers of the company.

Manufacturing- The manufacturing department produces and packages the toy for the purpose of distribution to the retailers.

Distribution- The distribution department of the company delivers the packages toys of the company for the purpose of distribution to the warehouses of the company and also distributes the finished products to the retailers of the company for selling it to the customers of the company.

1. product/Service Delivery- A.C Gilbert had produced train sets for their target customers but their most popular product line were chemistry sets, microscopes and also their best seller, the Mecanno-like erector engineering sets which has been popular with the target customers of the company, who are children, for more than 50 years. The toys of A.C Gilbert were not cheap in price and therefore they were high quality, solidly crafted and making end users part and packaging which were designed to last for a long time and the erector set product of the company were packed in long lasting metal boxes. The focus of the company was mainly on educational toys, which were primarily aimed for boys of 11 years rather than girls. The company had a limited range of products in the product line of the company but the limited products which were manufactured by the company was high quality in nature and was widely regarded by the customers of the company.
2. The three key systems and processes of the company are as follows:

Design- According to Peterson (2016) the design is considered as a vital process of the company which is responsible for the designing of the concept of the products and accordingly converting the concepts into designs. The assessment tools and techniques which will be used to monitor performance of the design process of the company are by test marketing the designs of the company among the stakeholders of the company and seeking their responses. The review strategy which will be used to test the effectiveness of the design process of the company is by analysing the expected outcome of the design and concept of the company.

Planning

Manufacturing- The manufacturing process is another vital process of the company which is responsible for manufacturing products according to the requirements of the customers and satisfying their requirement. As opined by Kang (2013) the assessment tools and techniques which will be used to monitor the performance of the manufacturing process of the company is by comparing the actual cost of production of the products of the company with the estimated cost of production of the products of the company. Another method which can be used to monitor the performance of the manufacturing process of the company is by comparing the actual time of production of the products of the company against the estimated production time of the products of the company. Another method which can be used to monitor the performance of the manufacturing process of the company is by reviewing the rate of error of the production process of the company.

Distribution- The distribution process is another important process which is responsible for distributing the products to the warehouse of the company for the purpose of distribution and also responsible for distributing the products of the company to the retailers of the company for selling it to the target customers of the company. As stated by Parida et al. (2017) the assessment tools and techniques which can be used to monitor the distribution process of the company is by comparing the actual distribution and transportation costs associated with distribution of the products with the estimated distribution and transportation costs associated with the distribution of the products of the company. Another assessment tools and techniques which can be used to monitor the distribution process of the company is by comparing the actual distribution time of the products with the estimated distribution time of the products of the company.

The performance review processes which will be used in the above mentioned case study are SWOT analysis, benchmarking performances and process maps.

A sample service level agreement is that the customers of the company can expect the delivery of the products within 24 hours after the ordering of the products.

KPA’s	KPI’s	Assessment Tools and Techniques	Performance and sustainability measures
Customers	Quality Standards- maintaining current quality standards and exceeding market expectations	· Service level agreement · Balanced scorecards · Performance reviews	Customer complaints, reduced defects
Financials	Sales budget- Achieving increase on previous year sales. ($20 million by 1963)	· Annual report of the company.	Cost control, increasing revenue
People	Retention of staffs- Re-training the engineers and production staffs in order to meet the new production requirements due to increase in the range of the products.	· Employee Satisfaction Surveys. · Employee Feedback	Engagement of the employees. Professional Development Plan
Processes	Production Times- Achieving key retail sales period.	· Sales Data	Productivity, Reduction in downtime

Performance Areas	Planned	Achieved	Reasons for Variance
Quality design/manufacturing	High quality and design of products	Low product quality and design	Using existing engineers and production department who lacked training and experience in new product range.
Sales	Greater sales	Lesser sales	Revamping of sales teams
Profit	Greater profit	Loss for consecutive years	Decline of quality of products
Supply chain performance	Effective supply chain performance	In-effective supply chain performance	Contradiction of the measures adopted by the company during crisis.
Business growth	Stable business growth	Decline in business	Increasing product lines

The trends which are relevant to the organization are as follows:

• As stated by Al Saifi (2015) the target customers of the company are more attracted by electronic advertisements.
• The customers of the products demanded trendy, modern and grown up toys.
• Emergence of large discount stores by replacing small and speciality retailers.
• The customers of the products of the company were attracted towards movie characters.
• The customers of the products were attracted towards bright and colourful products.

A.C Gilbert was unable to identify a large amount of trends which were prevalent in the toy market and as a result the company started to incur losses and the stock prices of the products of the company also decreased. The products of the company were advertised only on magazines and not on electronic media which failed to attract customers towards the products. The company also did not increase the product line of the company and rather they remain glued to the conventional products of the company only by focusing on the high quality of the products whereas the customers of the products demanded more trendy and fashionable products. The company did not imply colourful and bright advertisement in the packaging of the company which failed to attract customers as customers were attracted towards products with bright and colourful packaging.

Purchasing

The strength of the A.C. Gilbert company were presence of experienced personnel, established quality products and standards, strong reputation in the toy market and small yet profitable business.

The Weakness of the A.C Gilbert company were limited range of products, focusing on the past successes of the company, lack of training and planning before introducing large scale change and poor management of the company.

Market Share-

Reputation- The Company had a good reputation in the toy market of manufacturing high quality products for children though there were high priced in nature.

Stability- The Company was stable in the market place as a result of the high quality products of the company and as a result of the reputation of the company in the market.

Profit- The company earned a profit of $20,011 prior to 1960 which reflected that the company was earning normal profit in the market.

Sales- The sales of the company prior to 1960 was $11.5 million which reflected that the company enjoyed moderate sales of their products

Ability to adapt to changes- The company was unable to adapt to the changes which resulted in decreasing of the share price of the company.

Customer Service standards- The customer service standard of the company was moderate in nature which is evident from the fact that they had a good reputation in the market.

Innovation- The rate of innovation of the company was low which is evident from the fact that there were few existing product lines of the company.

Employee Performance- The employee performance of the company was average in nature which is evident from the fact that profit and sales level of the company was moderate in nature.

Production and Manufacturing- The production and manufacturing of the company was top quality which was evident from the high quality of the products.

The main missed opportunity of the company was that it failed to adapt to the changing trend in the toy market which was evident from the fact that they did not feel the necessity of introducing new product lines in the market or did not feel the necessity of innovating their products in the markets as they over-relied on the high quality of their products to remain competitive in the market. The company also failed to advertise their products through electronic media in the form of television in order to attract more customers as they relied mostly on newspaper and magazine prints for their products.

Manufacturing

The action plan for implementing the improvement in the project is to introduce new trendy and upgraded product lines in the market according to the demands of the customers in order to attract more customers towards the products of the company and also to advertise the products of the company in electronic media rather than on magazine and print media in order to attract more customers towards the products of the company.

1. As stated by Feng, Huang & Zhang (2016).The internal specialists who could consulted in the company are engineers, production staffs, manufacturing staffs, sales personnel and the human resources of the company and seek inputs regarding the drawbacks and issues of the current operational procedures of the company and regarding the operational process followed in the company so that new operational processes and procedures could be implemented in the company which will help in addressing the various internal issues identified.
2. The external specialists who could be consulted by the company are marketing consultants, advertising experts, engineers, designers and IT consultants. The external specialists of the company will provide information to the company regarding various trends and opportunities which are being currently observed in the market so that the company could take advantage of such opportunity and trends. The external consultants of the company could also provide ideas regarding various technological advancements and innovations such as e-commerce which could be utilized by the company in order to gain more benefits.

1. The performance improvement strategy of the company is designed in order to address the issues faced by the A.C Gilbert Company and in order to help the company regain its competitiveness in the market. The main aim of the performance improvement strategy of the company is to help the company recover from the losses which it faced and to help in regain its lost reputation in the market. As opined by Akhtar (2016) the first and foremost performance improvement strategy which should be implemented in the company is to improve the planning and designing process of the company by recruiting trained experts who specializes in designing and planning of trendy and fashionable toy products which would appeal to the customers of the company. Another performance strategy which will be applied in order to improve the performance of the company is by providing adequate training to the human resources of the company so that they are compatible with the skill and efficiency requirement of the company which will help in increasing the efficiency of the products of the company. As opined by ÖBerg (2016) another performance improvement strategy which could be implemented in the company is by implementing new technological advancements in the company in order to take advantage of current market trends and opportunities and in turn increase the competitiveness of the company in the market. The other performance improvement strategy which can be implanted in the company is implementing innovative advertising and promotional techniques in order to attract more and more customers towards the products of the company.

The strategic goals of the performance improvement strategy are as follows:

• Designing products according to the requirements of the customers of the company.
• Improving the efficiency of the human resources of the company.
• Attracting new customers through use of advanced promotional techniques.
• Recover the losses of the company.
• Improve the reputation of the company in the market.

The Key results areas (KRA’s) of the performance improvement strategy of the company are customers, financials, people and processes.

The Key performance indicators of the performance improvement strategy of the company are as follows:

• Design and introduce 10 new product by the end of the next year.
• Increase in staff effectiveness by 20 % at the end of the current year after training of the employees. 

• Attract 20% of the new customers of the market and 30% of the old customers of the company by implementing innovative promotional and advertisement technique.
• Increase the sales of the products by 20% at the end of the current year by implementing technological advancements in the company.

1. The proposed strategy will be presented to the team members through presentation and their opinion will be asked for regarding the strategy and they will be asked to evaluate the pros and cons of the proposed strategy. The team members will also be asked to evaluate the effectiveness of the proposed strategy and accordingly identify areas of improvement in the team briefing and consultation session. The presentation of the proposed strategy and evaluation of its pros and cons are in the form of a PowerPoint presentation attached along with the document.
2. New ideas and improvements regarding the proposed strategy will be generated by using creative idea generation techniques such as brainstorming, mind mapping and role playing. The new ideas which will be generated through the lead sessions will be discussed and evaluated accordingly with the team members and the ideas will be trialed on a testing basis in the lead session to test its effectiveness and if is found to viable in nature, then the previous proposed strategy will be amended accordingly with the new ideas and strategies.
3. The summary of the result of the session is as follows:

• The new performance improvement strategy of the company will mainly focus on improving the sales and profit of the company.
• Advanced methods of manufacturing, production and operations will be used in order to ensure the high quality of the products of the company.
• Focus on total quality management
• Focus on conducting surveys on the employees of the company in order to analyse their requirement.
• Focus on communicating to the workers the requirement for change in the organization
• Providing coaching and mentoring to the employees of the organization
• Focus on communicating the benefits of the change to the employees of the organization

1. The new performance improvement strategy of the company upon amendment is as follows:

The new performance improvement strategy of the company will mainly focus on improving the sales and profit of the company by introducing new products in the existing product lines of the company and also focus on developing new product lines for the company. According to the new improved performance improvement strategy, advanced methods of manufacturing, production and operations will be used in order to ensure the high quality of the products of the company. The new performance improvement strategy of the company will focus on total quality management in order to improve the operations of the company and also to reduce the amount of wastage associated with the manufacturing process of the company. The new performance improvement strategy of the company will also focus on conducting surveys on the employees of the company in order to analyse their requirement and accordingly develop their training strategy so that it helps in addressing the needs of all the employees of the company of all levels. The new performance improvement strategy of the company will also focus on communicating to the workers the requirement for change in the organization by explaining to them the actual performance of the company against the planned performance of the company so that they could understand the necessity of the change in the organization and accordingly accept the changes in the organization. The new performance improvement strategy of the company will also focus on providing coaching and mentoring to the employees of the organization in order to help them adapt effectively to the change in the organization and also making them familiar with the technological advancements of the company by providing training to them. The performance improvement strategy will also focus on communicating the benefits of the change to the employees of the organization so that they recognize the importance of change and accordingly commit themselves to the organizational change.

1. As opined by Schreiber, Simfronio & Simfronio (2014) there are various risks which are associated with the implementation of the performance improvement strategy in order to improve the performance of the company. As opined by Terouhid & Ries (2016) the main risk which is associated with implementation of the performance improvement strategy is the increasing operational costs which are associated with the implementing the new performance improvement strategy in the company such as costs which are associated with recruiting trained designers, training costs, promotional costs and costs associated with implementing technological advancements in the operations of the company. Another risk which is associated with implementation of the performance improvement strategy in the company is the unwillingness of the human resources of the company to adapt to the changes which are taking place in the company.
2. As stated by Chadha (2017) there are several costs which are associated with the implementation of the implementation of the performance improvement strategy in the company The costs which are associated with the implementation of the performance improvement strategy in the company are costs associated with recruitment of new trained designers, the training costs associated with training the new employees of the company, the promotional and advertisement costs which are associated with promoting the products of the company to the target customers and the costs which is associated with implementing technological advancements in the company.

Distribution

As stated by Cañibano (2013) there are several benefits which are associated with the implementation of the implementation of the performance improvement strategy in the company which are as follows:

• New trend and innovative product lines of the company which will help in attracting new customers.
• More effective design process of the products of the company.
• More effective human resources of the company with greater productivity.
• Utilization of existing market trends and opportunities by the company.
• Increased sales of the products of the company.

1. Action Plan:
2. Transition

Action	Objective	KPI	Timeframe
Reducing turn-over of the staffs of the company	Improving the skill level and the efficiency level of the workers and reducing costs related to recruitment of new staffs	The reduction of staff turnover from an average of 32% per annum to 20% per annum.	1- 5 months
Diving staffs and process workers into 5 separate teams	Each team force will be responsible on their 5 speciality lines	The team members will only work on their speciality lines in order to reduce the rate of error.	Within 2 years
Changing Roasters	The roasters will change to 12 hours shift	To ensure that there are enough staffs on each product line which does not impact on earning and loss of work hours?	Within 30 days followed by re-training schedule
Allocating specialists team members to individual lines	Increasing productivity of the employees, reducing wastes of the process, promoting the sustainability of the process and reducing the errors related to the process.	Achieving a maximum of 4% error rate and achieving 40% increase in productivity.	Within 2 years
Closure of production line for 48 hours	The staffs of the company will be re-trained in the production of their designated lines by the supervisors of the shift	Ensuring the staffs is familiar with the new system and product line of the company.	Within 30 days

 Communication

Activity	Objective	KPI	Timeframe
Team Meetings	Involving Teams in goal setting and objective setting for their own product lines in order to promote sustainability and production in the product lines.	Achieving a maximum of 4% error and 40% increase in the productivity of the employees.	Within 2 years

 The contingency plan related to possible implementation issues that is foreseen in activities in relation to action plans are as follows:

• As opined by Odoardi (2015) providing training to the team members so that they can enough opportunity for development which would motivate them to become specialists in their own teams.
• Providing incentives to staffs in order to motivate them to increase their productivity and decreasing of their error rate.

1. The implementation issues and failures are as follows:

• Stability of error rate on 20% instead of achieving 2%.
• Increase of waste by 10%.
• Decrease of the productivity by 8%.
• Issues regarding the safety of workers in the workplace.
• In-sufficient training methods to cope up with new machines.
• Concerns among the staffs regarding longer working hours.

1. New Action Plan is as follows:
2. Transition

Action	Objective	KPI	Timeframe
Reducing turn-over of the staffs of the company	Improving the skill level and the efficiency level of the workers and reducing costs related to recruitment of new staffs	The reduction of staff turnover from an average of 32% per annum to 20% per annum.	1- 5 months
Diving staffs and process workers into 5 separate teams	Each team force will be responsible on their 5 speciality lines and will be supervised by the operations manager of the company.	The team members will only work on their speciality lines in order to reduce the rate of error.	Within 2 years
Changing Roasters	The roasters will change to 8 hours shift	To ensure that there are enough staffs on each product line which does not impact on earning and loss of work hours of the staffs and so that they do not feel tired or fatigued due to their long roaster.	Within 30 days followed by re-training schedule
Allocating specialists team members and expert supervisors to individual lines who will guide the employees.	Increasing productivity of the employees, reducing wastes of the process, promoting the sustainability of the process and reducing the errors related to the process.	Achieving a maximum of 4% error rate and achieving 40% increase in productivity.	Within 2 years
Closure of production line for 96 hours	The staffs of the company will be re-trained in the production of their designated lines by the supervisors of the shift in order to ensure that they are familiar with the machines.	Ensuring the staffs is familiar with the new system and product line of the company.	Within 30 days

 Communication

Activity	Objective	KPI	Timeframe
Team Meetings	Involving Teams in goal setting and objective setting for their own product lines in order to promote sustainability and production in the product lines and providing them idea regarding how to implement sustainable practices in the workplace.	Achieving a maximum of 4% error and 40% increase in the productivity of the employees.	Within 2 years

The new contingency plans related to possible implementation issues that are foreseen in activities in relation to action plans are as follows:

• As opined by Robbins & O’Gorman (2016) providing financial as well as non-financial incentives to the staffs of the company in order to increase their productivity and decrease their turnover rate.
• As stated by Brorström (2015) providing training regarding workplace health and safety to the employees in order to prevent them workplace accidents and provide training and mentoring regarding implementing sustainable practices in workplaces.

1. Schedule for evaluation and continuous improvement are as follows:

Evaluation Activity	Objectives	KPIs	Timing
Monthly Performance review	Reducing the rate of error of the employees.	Achieve a maximum of 4% error in the operations of the company.	Monthly
Performance Appraisal	Reducing the employee turnover of the company.	Reducing staff turnover by 20% per annum in the company	Yearly
Arranging for training and development of the employees	Increasing the productivity of the employees of the company	Increasing employee productivity by 40% in the company.	Half-yearly

References

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