1. Assessment Details
The assessment is in two parts:
1.1. Group Assessment: Your role is to operate as project team and you are expected to utilise a Project Management methodology to assess the case study and create the people plan to address the business strategies outlined in the case. You are expected to apply the appropriate Project Management and HR principles, theory, frameworks and relevant literature.
The group presentation must be no more than 8 slides and used to demonstrate the application of the Project Management approach applied to the case study.
The written assessment needs to justify your analysis of the case study academically and support those issues identified within your presentation. You need to use academic theory, references state any assumptions and conclusions you have made. As a project team you are requested to include an executive summary, recommendations and project plan (as a minimum) that can deliver the People strategy that will achieve the business objectives outlined in the case study.
Your submission for the written piece should be no more than 2500 words.
1.2. Individual Assessment: Your individual assessment should be a reflective piece of no more than 500 words. This reflective piece should be written as a critical analysis of how your team worked as a project team. You should utilise the relevant theory within Project Management and also Human Resource Management to justify your analysis of the experience. You could draw comparisons between differing groups that you have worked within to further justify your viewpoint.
1.3. Your final pieces of work should be written in formal, academic English with accurate referencing and should be no more than the words stated in the brief above. You should apply a business and academic approach to your work.
2. Background of Case Study
This case study is written by Andrea Ward. The case study outlines real exs from a number of organisations that will remain anonymous. The details were evident at the time of observation and are contextualised into a fictional company called Random Alloys. All information, quotes and statistics are all real data that has been gained direct from the organisations.
3. Background to Random Alloys Ltd
Random Alloys is an independent family run organisation based in Oxfordshire which has been operating for over 100 years. During the inter-war years the business was at its peak and employed 7,500 people within the region and at 5 other sites across the UK. It operated in a variety of markets such as oil, gas, motor, nuclear and marine. Their sales during this time were on a number of products to a variety of industries and their biggest contribution to profit was from their sales to the military and the nuclear industry. Following the wars and the subsequent cold war, sales had subsided in these areas. These greatly impacted on the business and over the last 30 years the business had been declining. During this same period, the market was being challenged by heavy competition coming from India and China where raw materials were cheaper, competition increased and prices were reduced within the market place. Currently the company has now only one site based in the Oxfordshire region, with an employee base of 115 people. Turnover of the business is the last financial year was £43m. The core business since the 1980’s has been the supply of alloys rings and shafts to nuclear science and oil industry.
The organisation has been owned and led by the same family from the beginning. The directors have always been family members. There has never been “an outsider” on the board or in their senior leadership team. Over the years many of the family members chose not to work for Random Alloys but have built their career outside the organisation and are no longer involved. The newly appointed Managing Director, Ralph Burton, a family member has just taken over the business in January 2013 when his father, William Burton, retired. Ralph has always done what his father has told him to do and whilst he respected his father there were decisions that his father had taken that Ralph had disagreed with. William was very hands on in the business over his tenure and had made all the decisions himself and gave instructions to all staff.
Random Alloys turnover over the years had been declining, it responded by downsizing the organisation, closing sites and making redundancies to cut costs from within the business. The new Managing Director, Ralph Burton, believes they have now reached a point where they need to consider the next steps they take to maintain current levels of trade and to diversify their interests into other fields. The main customer base has been in the nuclear science and oil industry providing alloy rings and shafts. The company has steadily grown more clients within the up and coming oil companies in the Russian Federation. This however is reaching saturation point. Thus the company has decided to maintain the current business approach within these sectors by retaining market share though improving the quality of the product and service lead times; having recognised that price has reached its peak in this relatively stable market place.
During the last 2 years, William Burton had instructed the implementation of an approach called Lean Manufacturing1 as he had heard about this new way of cutting costs by becoming more efficient in manufacturing. William had hired 2 six sigma black belt consultants with a history of implementing Lean Manufacturing. The prime reason for this was to make the production line more efficient to compete with cheaper producing countries such as India and China. There appeared to be no impact on the financial figures following this implementation until recently and they are only just starting to improve, 18 months after the implementation. According to the original proposal, these benefits should have been realised within 9-12 months of the implementation. There were issues with how the work had been implemented, there had been no training for those in operations, the Lean Manufacturing processes had not been applied in all functions and, as a result, the chain of paperwork required from order to completion was not flowing smoothly. As a further result, many workers had left the organisation and others who had tried to resolve problems had been met by conflict from the Head Office staff who stated “they shouldn’t have done it without consulting them”.
Ralph had discussed this with the consultants recently and they had informed him that William had instructed them to implement Lean Manufacturing without engaging the staff during the creation of the process but just to get on with implementing it by observing staff and how they worked. The Consultants had describeed to Ralph that they would normally look at a whole Lean Manufacturing process and involve people before and during any implementation. However William had requested that this was excluded from the work as he saw training and engagement as a distraction. Consequently it had taken longer for the workforce to understand the new ways of working. Having said this, staff were enthusiastic about the Lean Manufacturing approach and stated that they “wished it had been done years before”.
During the work undertaken by the Lean Manufacturing consultants they had informed Ralph of the anecdotal information of what staff had said to them. Staff had complained about different departments working different hours and some having flexible work patterns and others not. There were complaints about the managers sitting in their offices and not engaging or communicating with staff. The staff has complained about fixed pay rates regardless of the work undertaken, some by skilled staff and some by unskilled staff. Ralph also knew there was a high turnover of staff and the main reasons for leaving were they were not stretched enough, had no clear roles nor did people believe they were utilising all their skills. Ralph realised that he needed to get the workforce on side to keep the performance levels up and increase the retention. Current % of staff turnover was 11% industry average was 8%
Ralph is unsure how to examine the feelings of his workforce in a meaningful manner. He knows some of the issues are about communication, pay and not being stretched but isn’t sure what else are the issues.
Having seen a number of things over his years of working in the business, Ralph as MD felt he now had the power to do something. However, although his father had retired from everyday business he is still the Chairman and still likes to appear on occasions and say what he thinks should happen. This frustrates Ralph who wants his father to “back off” and let him manage.
Over the last 5 years Ralph has been developing himself and reading business papers. Having undertaken his MBA he had started to formulate a structure of how the business might go forward under his leadership. Ralph has a view of keeping the core business that provides the main income stream and what the company is known for but has ideas about how to make it generate more profit through efficiencies and re-entering markets such as aerospace, marine and motor industry. He had observed there was a large amount of investment in these markets from the huge defence contracts that were available from the public sector as well as the investment from Boeing and Airbus and Nissan and Toyota.
4. Business Structure
The business structure is as follows:
The Chairman is William Burton, with his wife, Anna Burton, as a non-executive director. The Management Team who runs the day to day business is now managed by Ralph as Managing Director. Paul, Ralph’s brother is the Finance Director and Ralph’s son Anthony is the Sales Manager. The directors of the company are William, Ralph and Paul. Ralph was previously Operations Director and has not been replaced.
The operational side of the business is managed by the Engineering Manager, George Bacon, who runs the production function. George has been with the company for 2 years. Previously with Nissan, he played a big role in influencing William to adopt Lean Manufacturing. The current structure is now in the best format reflecting the Lean Manufacturing process which the consultants recommended except in the area of Distribution and Logistics; which was “dumped” onto the Engineering Manager role by William. George has a similar autocratic style to William but during the Lean Manufacturing change process he was a key stakeholder and really got the teams on board despite some of his supervisors and team managers being reticent.
Vera Rodgers is the Personnel Manager and has been with the company for 40 years. She is well thought of by William. She is involved with all recruitment decisions and manages all the disciplinary actions and sick absence issues. She also undertakes exit interviews but doesn’t pass on intelligence collected from these with the relevant managers.
5. Family Background
One of Ralph’s brothers, Michael, is now the Production Director at Toyota having spent his career at Rolls Royce and BAE Systems before joining Toyota. Having worked for nearly 20 years within these companies, Michael has shared his experiences and influenced Ralph’s thinking about how to run the business. Their sister, Anita, trained as an engineer before going to university at the age of 30 to complete a marketing degree which enabled her to join Procter and Gamble, eventually becoming its Marketing Vice President in America. She has lived in America for 15 years. Following the death of her husband from cancer she decided to come back to the UK but cannot afford to do that without a job. Ralph has seen what his sister has been through and would like to support her by bringing her into the business. He believes that she would bring new skills and experiences to the table but it would mean she may be taking over the marketing manager job from his son Anthony.
Following the implementation of the Lean Manufacturing process, Ralph had invited the consultants back to observe how things were working out. This was done as a gesture of good will as the consultants were compiling a case study to further develop their own business. Following their walk around the organisation and after chatting to a number of staff, anecdotal evidence was given to Ralph that he found intriguing.
The following information was revealed:
The process for Lean Manufacturing was working well in the machine yards and warehouses but there was a delay in 3 areas; the order processing from the main office, the paperwork approval for the deliveries and letter of authority which was required before the goods left the premises. (A letter of authority is when all parts are defined with their specification and a declaration of the quality checks that have been undertaken. It is signed by people within the organisation and has to stand up to scrutiny if there are any issues about delivery and quality). The consultants also stated that the orders would sit for days without being delivered even though all were ready to go. This was no surprise to Ralph as he had observed this himself during his time working on the shop floor.
The main office seemed to be in disarray as people from the warehouse really didn’t know who to speak to about queries within the main office. Predominately this was a problem in finance and administration. Many queries were sorted out by using colleagues who they had known for a long time.
There was gossip about sensitive matters such as employment relations issues which were commonly known before hearings had even taken place e.g. in relation to suspension, dismissal, bullying and sexual harassment claims. There were a number of occasions when the consultants were told that some of the supervisors and team leaders would not follow procedure for Health &Safety. When a member of staff corrected the supervisor, he stated that it doesn’t really matter we have always done it the other way and no one has been hurt.
The consultants also fed back that the staff had been used to a very autocratic style. They saw Ralph very differently and enjoyed him coming onto the shop floor and engaging with them.
Ralph had also noticed that Paul, the Finance Director was working long hours and that he was making all the decisions instead of some of his team members making them. Ralph had concerns about whether Paul would be able to support the new strategy as it may need some capital investment analysis. He seemed very overworked and burdened down with day to day issues.
Ralph decided to do a survey about how people felt about working in the organisation. Now he has this information he is not sure what to do with it. Vera, the Personnel Manager has not been much help as she has no experience in this area. She is not very motivated and has suggested she wants to retire.
Ralph has been looking at the sales figures and they are static with the same customers buying the same things all the time. Familiarity with these customers means he also knows they buy products from competitors even though Random Alloys could supply them. He wonders why Anthony is not trying to capture this business. He also recognises that Anthony and William, his grandfather had a very close relationship. Following discussions about the ‘lost’ potential business, Anthony says he is too busy with purchasing and publishing brochures, his sales team are not productive and that he can’t seem to find the time to manage them. Ralph believes that these are missed opportunities for gaining new sales. He has spoken to some of the company’s customers and their main issue is they don’t see the sales managers frequently enough. In addition the sales managers don’t appear very knowledgeable with the technical specification of the products. Ralph is disappointed that his son has not coordinated his team better. He recognises that Anthony has a lot of technical knowledge but may be lacking other skills. Ralph was also concerned that when approached about the missed opportunities for business, Anthony became annoyed and angry. He didn’t manage his emotions well and this was similar to behaviour towards other people where he would shout or would hang up when on the telephone. Some customers also informed Ralph that they were always querying invoices that would often contain different prices compared to amounts agreed with members of the sales team. Alternatively, they would have to chase invoices as they hadn’t been sent out by the company. Customers also said when they called the offices they might be told different things if they spoke to different people.
8. Business Strategy
Ralph has created a strategy for the business going forward and is considering how to communicate and translate this across the company which he believes is not structured in the best way to deliver the strategic objectives. Firstly, he needs to get the Directors and senior team to agree to the strategy. He realises there may be some difficulty persuading his father to accept the new strategy and that his brother Paul the FD may also be hostile as he is already struggling with the fact that his father passed on the role of MD to Ralph who is the youngest sibling.
Ralph’s strategic view is two-fold:
1. Maintain the current business plan of manufacturing alloys making them a better quality product, reduce the errors which the Lean Manufacturing Process has already started to address, and build more sales of alloy rings and shafts and other sizes through the existing market and customer bases whilst attracting new customers.
2. Specialise in alloys for the sectors of the market they are re-entering. To do this, research is required to update everyone’s knowledge in order to develop prototypes to present to potential customers within the defence, aerospace and car industry.
Ralph believes to do this they will need to modernise the main office functions through creating efficiencies and streamlining reporting lines with more delegation of responsibility. He recognises the need for different skills to achieve his strategy.
He has created a vision of “To be the best for service and quality within the industry with the best team”. Yet Ralph is concerned that this is all his thinking and knows that he needs to bring people on board if they are all to believe in the same vision. Ralph is now considering very carefully what people strategy he will employ to support his business strategy.