Case Study Discussion 1 (10%):

Company A is developed in early 2016 with its own unique design for making a Laser Scanners with relatively new technology that was growing fairly rapidly in interest and in competitors. The founder of the company had started by using his engineering skills as an individual inventor, but with some borrowed money he was able to set up a small production facility. Now that he had been in the business for four years, he noticed that near the end of his fiscal year, he was likely to sell more than 35 scanners. He only had three other people on his management staff: the financial officer, the production manager, and the marketing and sales manager.

CEO point of view:

During recent monthly planning meeting, the CEO mentioned that they are gaining a good reputation in a market that is growing rapidly, given that it is in the early stages of the life cycle.

Marketing and sales manager point of view:

Not only do several of the original customers plan on buying another scanner, but they have also told other potential customers that they like the specific design and embedded technology, and some of those potential customers are likely to buy as well. It is approximated that their sales next year to possibly 60 or more scanners.

Production manager point of view:

She believes that they need to hold back on making sales since they are already finding it tough to deliver on promises for this year. She believes that the workers agreed to work on some weekends, but it will not going to be the same promises to that next year. While they like the extra money, they all have families and dont want to spend that much time away from home. From her point of view, the only way they can really expand to sell and make 60 scanners next year is to hire a lot more people because if they continue putting more pressure on the current employees, they are skilled people who are making most of these scanners in a somewhat unique design based on the specific needs of the customer. Skilled people like that often have several options as to where to work, and most of them would not like to work a second shift where they could not spend evenings with their families. They could try to double the number of workers on the regular day shift, but that would mean duplicating all the current equipment as well. Also, while today they probably have the space in their facility to fit duplicate equipment, if they grow more the following year they will also have to expand their space requirements.

Financial manager point of view:

He believes that after four years they are finally looking a little better financially, but adding a whole lot more people and equipment is going to cost a lot. Also, given that each customer specifies at least some unique aspect of design based on their individual needs, and also it takes a fair amount of time to build them, that means they get to see the money from the sale only after many weeks after the order is placed, but in the meantime they have to obtain materials and pay workers for todays new orderswhich are larger in number in this growing market. This implies that even though the profit per unit is good, they have a struggle with cash flow.

Discussion Topic:

Try to help the management team out. After listing the key issues and characteristics of the environment and the problem, list all the possible alternative approaches they could take to deal with the issues (consider adding a few people (employees) to the team as one alternative).

For each alternative, try to list the pros and cons likely involved.

Then select an approach you would recommend and attempt to justify it.

The discussion should be written in three paragraphs (max 400 words)

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The following solution is not acceptaed and considered as a direct plagiarism

^{_{1. There could be some alternatives to this resource problem which they have. A) They could look at additional investors who can help them add cash flow to hire more people and equipment in order to meet the projected orders. B) They could reduce the sales to the capacity of the company production unit. C) They can add more people and take the risk of the forecasted order value by funding the new capacity by a commercial loan. D) They can outsource the basic activities which do not need specialized skills and which can be conducted by a third party and then undertake the critical work on their own.}}

^{_{2.. A) PROS - This will help to meet the projected demand and add more capacity to the company which can help in future expansion as well. The investor can also serve to increase credibility of the company. CONS - The owner will have to share the business shareholding with another person. This may also mean to share the control. This will also increase the pressure of performance and sales on the company. B) PROS - They will not have to bear the additional financial pressure and will be able to manage the sales smoothly. CONS - They will lose opportunity to grow in the market and increase capacity which may reduce competitiveness and move customers to competition. C) PROS - This will help them to expand which may further bring opportunity for future growth and satisfied customers. CONS - This may increase the financial pressure on the company and reduce its overall financial attractiveness. D) PROS - This will reduce the pressure on the employees and increase the employee satisfaction which will help the company to perform better and innovate. CONS - This will reduce the control on the basic processes and they will have to choose a capable and reliable vendor for timely and quality work to be delivered. 3. The approach which is most suited is A and D. D is preferable due to the supplier association which can help the company take larger orders and increase customer base. This will also help the company to have a preferred partner who can also help them in increasing capacity and future growth along with sales and after sales service.}}