Instructions: 1. BEFORE THE ASSESSMENT: Read the information below and on the next page. 2. IN THE ASSESSMENT: Discuss the situation with your colleagues and select the action(s) that you feel is most appropriate. You do NOT have to reach a final agreement. Time allowed: 10-12 minutes (10 minutes for groups of 3; 12 minutes for groups of 4) Context: You and your colleagues are members of the management team at MallReit, a medium-sized operator of shopping centres and car parks. Your own offices are located in rather crowded office space in Causeway Bay. You operate 6 shopping centres and their car parks in locations across Hong Kong. 93% of the shop units currently have tenants. Cleaning, security and maintenance services are all outsourced. You are a listed company, operating on a very tight profit margin. This has put pressure on dividends and affected your share price. One of your shopping centres, in Tsuen Wan, is due to be renovated: a food court will be converted into shops. Market research indicates that this will use the space more profitably. You must reduce costs and/or increase revenue urgently to make the company more profitable. You need to improve profitability by 50 currency units. A firm of consultants has suggested some possible savings in a report. This is summarised on the opposite page. Your objective: Decide how best to improve profitability by 50 currency units. Suggested meeting agenda:- 1. Identify the key problem / issue: What is wrong? 2. Identify the ideal solution: What would you like to see? 3. Establish the facts: What do you know? 4. Identify the stakeholders: Who is affected? 5. Identify the available options:- What could you do? 6. Consider the advantages and What are the pros and cons? disadvantages of these options: Who will gain? Who will lose? 7. Decide on the best way forward: What is the best thing to do? Key information Cost area Facilities management 15- 1 1 1 1 1 5 10- Marketing Consultants' recommendations Estimated contribution to profit (units) Delay renovation of Tsuen Wan mall....... Raise rents on shop units 10 Raise parking fees .... Delay upgrade of security equipment Reduce Christmas decoration budget.... 10 Delay redesign and upgrade of website 52 Reduce subcontracting costs for cleaning, security and maintenance 10 units for each service Salary freeze ......... Reduce training budget Reduce receivables (money owed by tenants) 10 Reduce dividend to shareholders .5 Cheaper office premises ....... 10 Save energy (lighting, air-conditioning) 52 Operations 10- e e e Human resources Accounts 5- Instructions: 1. BEFORE THE ASSESSMENT: Read the information below and on the next page. 2. IN THE ASSESSMENT: Discuss the situation with your colleagues and select the action(s) that you feel is most appropriate. You do NOT have to reach a final agreement. Time allowed: 10-12 minutes (10 minutes for groups of 3; 12 minutes for groups of 4) Context: You and your colleagues are members of the management team at MallReit, a medium-sized operator of shopping centres and car parks. Your own offices are located in rather crowded office space in Causeway Bay. You operate 6 shopping centres and their car parks in locations across Hong Kong. 93% of the shop units currently have tenants. Cleaning, security and maintenance services are all outsourced. You are a listed company, operating on a very tight profit margin. This has put pressure on dividends and affected your share price. One of your shopping centres, in Tsuen Wan, is due to be renovated: a food court will be converted into shops. Market research indicates that this will use the space more profitably. You must reduce costs and/or increase revenue urgently to make the company more profitable. You need to improve profitability by 50 currency units. A firm of consultants has suggested some possible savings in a report. This is summarised on the opposite page. Your objective: Decide how best to improve profitability by 50 currency units. Suggested meeting agenda:- 1. Identify the key problem / issue: What is wrong? 2. Identify the ideal solution: What would you like to see? 3. Establish the facts: What do you know? 4. Identify the stakeholders: Who is affected? 5. Identify the available options:- What could you do? 6. Consider the advantages and What are the pros and cons? disadvantages of these options: Who will gain? Who will lose? 7. Decide on the best way forward: What is the best thing to do? Key information Cost area Facilities management 15- 1 1 1 1 1 5 10- Marketing Consultants' recommendations Estimated contribution to profit (units) Delay renovation of Tsuen Wan mall....... Raise rents on shop units 10 Raise parking fees .... Delay upgrade of security equipment Reduce Christmas decoration budget.... 10 Delay redesign and upgrade of website 52 Reduce subcontracting costs for cleaning, security and maintenance 10 units for each service Salary freeze ......... Reduce training budget Reduce receivables (money owed by tenants) 10 Reduce dividend to shareholders .5 Cheaper office premises ....... 10 Save energy (lighting, air-conditioning) 52 Operations 10- e e e Human resources Accounts 5
