How Effective Technological Measures Are the Solution to Various Marketing and Operational Problems - Case Study Example

Table of Contents Contents Avison Industry – Case 3 Challenges: 3 Issues to be accounted for: 3 NINAK Fireworks Case Study 4 Example of IPO Model’s application to Ninak: 7 NINAK FIREWORKS MINDMAP 7 Mind Map: 8 References: 10 Avison Industry – Case India is one of the emerging economies of the world with economists all around the globe keeping a keen eye on this Asian region after China. The high growth patterns in 2010 signify the impact this economy can have on a Global basis; their GPD growth standing at 8.9% by the end of 2010 – a high proportion of credit that accounted for this growth is given to the industrial section (East India Forum 2011); it is due to this industry via appropriate innovations with aid of Information Technology (IT) that India’s industrial sector has boomed. Avison Industry is one which is based in Kolhapur; it takes responsibility to manufacture different components of steel used in automobile and other big industrial manufacturing industries. The mission of the company stands to satisfy customers with superior performance products efficiently. In order to do so, the company realized the need for an independent Information Technology (IT) solution that integrates their whole production process in to one system. Workforce of over one hundred employees working without an integrated system was already causing the company trouble to keep up with their stated mission; the lack of an integrated IT system caused mismanagements of raw materials, customer supplies that resulted in delays and agitated customers. For a vital industry like Avison, it was an integral part to develop changes to stay in the game of India’s boom. Challenges: Following were few of the challenges that further enhanced the need for an integrated IT system (Case: Embee Software Pvt. Ltd; 2010): Adequate reporting tools were needed to better document the state of the company Presence of Unreliability owing to manual work practices Quality, one of the main aims, was to be met via stringent security check at different points of production. Integrations of departments were needed; like that of Human Resource with Finance. Independent working of departments was a source of inefficiency. Issues to be accounted for: Avison Industries could not risk losing out of business due to these factors and knew the situation had to be addressed; as a result the company contacted Embee Software Private Ltd; a firm responsible for providing such companies with effective IT based solutions. Embee was able to identify the following issues that had to be accounted for in the new system: Inventory Management Vendor Performance Management Production Planning Financial Analysis Efficient and smart reporting to aid decision making It didn’t take Embee long to determine that Avison needed a complete ERP solution to help overcome its current issues that will help it to stay in the industry. An Enterprise Resource Planning system is one which is used not only by manufacturing firms but also by service and education industries in universities and schools; it is a complete set of IT solutions that aid to connect and integrate a business with its internal and external stakeholders (Encyclopedia 2004). For Avison, this system was ideal; although ERP implementation for a completely integrated system was an expensive transition, but for the longer run it turned out to be a profitable investment as the firm not only reduced costs by improvements in efficiency but also managed to attain a larger customer data base owning to fulfillment of its mission statement of quality standards by effective use of this ERP solution by Embee that was done in various stages. The customers alongside the staff of over 100 employees were satisfied with ease of working and reliability of the system; ventures like these have helped many developing industries to become star industries of an economy, efficient use of Information Technology can change the face of the entire company in a positive fashion. NINAK Fireworks Case Study Ninak fireworks enjoys a great market share by having the status of the largest UK based firework manufacturer whose sales are based on high volumes to reflect the success of this company. Ninak Fireworks is structured into four different departments each having vital key roles contributing to the success of the organization. However, in order for any company to attain success, a well-integrated workforce is crucial or else all efforts made independently by departments are likely to go in vain in the longer run; companies tend to fail without effective communication and integration with different departments (coordination problem). Ninak Fireworks is facing many challenges but most of these factors circulate around the fact of lack of coordination between departments; this factor limits or misrepresents information provided to other departments as a result of which the company is unable to fulfill its commitments to its customers. A vital issue in the operations stage arises out of inability to identify the “right” product mix due to lack of information provided by other departments. A product mix refers to the best and most efficient manufacturing quantities of different products that are required to fulfill company’s objectives; this can only be done if inter communication between sales, logistics and operations departments are not hampered in any way. To overcome the problem; the company can use the “Business Process Mapping” model whereby a detailed process map can be drawn that specifically highlights the job of each personnel within each department. It is vital to apply the model to improve inter department communication and is one of the reasons why ISO 9001 has made it a compulsion for firms to adapt to a process approach for managing a business (Anderson, 2009). The main purpose of the business process map is to increase efficiency; it can be done so at Ninak Fireworks in the following mannar: By creation of a flowchart that is the primary aspect of a business map; this flowchart will exactly represent the production process of Ninak fireworks (the 16 stages of the process of manufacturing) after which it will be easier to identify problems of starvation, lead times can be identified and interdepartmental communication patterns would be identified making it easier for the company to know exactly which production process needs more integration in terms of communication. Not only will application of this model improve communication but also ensure that errors on stock level quantities and misrepresentation of data leading to bad decisions, are avoided; the company charges £50 for Prompt logistics and due to these problems if the company cannot fulfill its commitments, it will cause a bad name for the firm which is the leading fireworks manufacturer. The application of this model to increase efficiency is crucial as the company indulges in promises of delivery on different time slots depending upon pay; thus its revenue and good will depends on efficiency of the process. Considering a time whereby the company has a lot of potential for future expansion in terms of exports and online sales, it cannot risk its reputation at this point in time and has to apply relevant models for improvements. A problem in sales forecasting also results in inappropriate data being provided to the operations departments; to overcome this problem an Executive support system or a Decision support system can be implemented that work on artificial intelligence and eradicates human errors; the given data suggests that’s the company mismanages its operations in times of high demand i.e New Years or different festivals. A decision support system is a solution that will work on data provided by Ninak to determine stock reorder quantities and help in production decision. Following is the example of how this system can work for Ninak Fireworks: Previous trends in sales are analyzed and the system is aware of the sale patterns before New Years Eve, thus using artificial intelligence the system will automatically anticipate rising sales (assuming other factors constant) and thus will send re order requests to Ninak’s suppliers like China Illumination and Telon Plastics as suppliers have various lead times, in these cases foreign suppliers may take over 30 days to supply. The system will evaluate the production time and based on that keep a safe margin of error and make orders well in advance to ensure the company re orders at the right time the right quantities as to avoid any dissatisfied customers. The decision support system is an integrated system whereby essential data of vital departments like sales and production is crucial. This would further save time for the employees and more emphasis can be made on product quality. In order to further save time and be in line with its competitors, Ninak fireworks may look into the 4 stage model of operations contribution; whereby the second stage would suggest the company to compare itself to the competitors observe its standing and wisely make decisions based on that scenario. This way, the company can indulge in online business practices whereby it can apply the “IPO” (Input-process-output) model of information technology by evolving a new system based on its need. This way, customers may directly make orders to the company and the system incorporates incoming data, processes it and accordingly adjusts inventory levels and further aids in reporting tools (output); this process will save time for the company and ensure minimum human errors. Example of IPO Model’s application to Ninak: The ordering process can be automated whereby clients would be making online purchases or the data is entered in real time into the automated system (Input); this way immediate reporting of the order can be done and passed on to the production department and also aid the DSS (Decision Support System) to check on inventory levels and anticipate future sales (Processing). The customer can receive digital or real time right then and there generated receipts making the process of ordering (Output Stage) less prone to human errors. Lastly, the company may apply the value chain model to further add value to its existing system of operations and sales; Ninak does not necessarily has to send its personnel to clients but the use of softwares like “Skype” for video conferencing can aid in saving time for both the company and the customer. NINAK FIREWORKS MINDMAP The recent trend in organization has been to collaborate and create a family like environment to make work easier and more efficient; it has proven to be a great success and top multi nationals all around the world adopt policies to ensure this family culture prevails for best outcomes. In case of Ninak Fireworks, it can be observed by statements given by heads of different departments that there exists a great deal of disparity. Jeff Tyron’s statement “I have a lot of respect for both Claire and Li, but…” indicates mismanagement and differences in the heads of the departments that need to be settled before they become bigger issues. These disparities are not of a personal nature but of professional nature so far thus they can be eradicated by appropriate measures to make the firm prosper professionally. These issues cause frustration and agitation in the longer run and can directly hamper productivity and quality (in case of Nina Fireworks it can also imply compromising on safety of products) which can likely result in the company losing out customers and in worst case scenario, the company being wound up. The following mind map highlights how the company needs to be integrated within departments and how adequate policy measures should be adopted to create a friendly environment alongside adapting an IT based solution for automation of the process. Mind Map: In order to bring about positive improvements in Ninak’s operations of its business, it needs to undergo many technical changes that will not only aid in long term sales and profitability but also create positive and healthy environments to work in whereby employee motivation would be another factor contributing towards success. Ninak faces many challenges in terms of operations; at one point in time the case states an instance where by pyro technicians are left waiting for next batches of parts to arrive; this is a phenomenon known as “Starvation” in terms of Productions and Operations management. Starvation causes inefficiency and delays in the production process and can be avoided by adapting to a more systematic production process. In this case, from receipts to production, most of the process is manual. Some of the parts should be automated in the production process like that of gluing the main fuse, filling compartment with stars by using automated filling machines, topping up with gun powder and inserting lift charges. This way, the hazard of safety can be addressed but more importantly, it will prove to be more convenient for the company and it can use its personnel on other key fields like online sales and export orders to exploit the full potential of this industry before the competitions gain an edge; at present Ninak is the market leader and using its resources it can still gain a competitive edge over its competitors via improvements in production process. These improvements are further going to aid in the ERP system; an integrated Enterprise Resource Planning system by any professional IT firm like Oracle or SAP will ensure Ninak gets a customized software suited for its needs that integrates not only data from other departments but feeds in all relevant data obtained from the new automated production process as well. This way, inventory can be managed in a more systematic manner as well as some of the suppliers like that of Gun powder and explosives are based in China and can take about a month to obtain supplies. However, supplies for miscellaneous parts may be localized by finding local dealers to further aid the process as these parts are not integral for the overall success nor do they pose a security/safety hazard. Solution: The ERP system is an all in one solution that will solve the problems of mismanagement caused due to lack of proper coordination between departments; the system is likely to minimize all issues faced by Ninak Fireworks and aid in the process of remaining competent in the market and utilizing on its full potential for the longer run; it is time the company needs to gear up for the future. References: 1. M. Govinda Rao. NIPFP; East India Forum 2011, India: Sustaining high growth needs new reform momentum, Available from: [9 January, 2011] 2. Case study for ERP Implementation, Embee Software Pvt. Ltd; 2010 3. Bidgoli, Hossein, (2004). The Internet Encyclopedia, Volume 1, John Wiley & Sons, Inc. p. 707 4. Stevin Horwitz; Coordination Problem, Available from: [2010] 5. Anderson, Chris. “What is a Process Map”, Buzmanualz. 3 August, 2009 6. David W. Eccles, Paul T. Groth; “Agent Coordination and Communication”. University of Southampton, United Kingdom [27 February 2006] 7. Stephen Morris, (2002). “Coordination, Communication and Common Knowledge”. Oxford Review of Economic Policy, Vol.18(4), pages 433-455. 8. Erik Fosser, Olek H. Leister, Carl E. Moe. “ERP Systems and competitive advantage”. University of Agder, Noway. [2008] 9. David Arnott. “Decision support system evolution”. European Journal of Information systems [2004] 10. Takashi Hasuike. “Multi-criteria product mix problems”, International journal of Management Science, Vol.4(2009) No.1, pp. 60-71. Read More