Background
The firm is a manufacturer of small wooden kazoos, tops, and whistles. At time of certification, the firm had 12 employees and annual sales of approximately $638 thousand.
As a producer of all wood kazoos, tops, and whistles, the firm was import impacted by penetration of domestic markets by overseas manufacturers, and the inroads of alternative fabricated materials used to produce these products.
The firm had begun addressing the materials issue by experimenting with various types of fabricated materials, while maintaining an active presence in the market by attending trade shows and investigating niche markets that still sell only all wood toys.
Assistance
Diversification into new markets that would capitalize on the strengths of the firm's current products was the firm's primary strategic objective. The action necessary to achieve this objective encompassed a planned yet action-packed marketing effort that targeted new business from current and potential customers.
To succeed in new markets, three critical functions required attention. The firm, with TAAC assistance, needed to develop a plan to build an organized marketing function and evaluate opportunities for new business. This project took into consideration the firm's current activities in marketing and then developed the structure and tools needed for obtaining new business. The project cost approximately $20,000.
A second project addressed management's need to operate and understand the techniques and procedural aspects of its automated equipment. This project would address how to design and operate the automated equipment to benefit from the machine's vast capabilities. This project would cost $10,000.
A third project would assess the firm's needs and capabilities as related to its information system requirements. Based on the analysis, the consultant evaluated the current implementation of the "Prosper" package. Recommendations were made, along with a plan of action to integrate the selected solution. The project cost was estimated at $25,000.
Results
With two of the three projects completed, the firm was experiencing a lot of new interest by customers. Existing customers are pleased with the new aggressive stance to sales and many new, prospective customers are just now finding out about the firm.
Background
The firm is a manufacturer of upholstered and wooden office furniture. At certification, the firm had 30 employees and annual sales of approximately than $2 million.
A highly competitive market has battered the firm for years. Canada and Mexico have been flooding the U.S. market with goods produced from inferior material and cheaper labor. Russia has entered the picture with its vast supply of cheap raw material that can offset the cost of transportation to the United States. In addition, Japan has been exporting its imitation wood products at reduced rates making it difficult for many U.S. firms to remain competitive. During the mid 90’s, the percentage of imported furniture continued to rise, on average 14 percent per year, making it very difficult for U.S. producers to keep abreast of the market.
Moreover, the firm also competes in a domestic market that has for years experienced the trend of mergers and acquisitions resulting in a glut of used office furniture in the marketplace.
Assistance
The recovery strategy highlighted two areas deemed critical for the continued operation of the business, management information systems (MIS) and marketing. On the MIS issue, the TAAC discovered that accounting, job costing, procedures, methods, and standards were not being captured in a manner that provided management with timely or useful information. A plan was developed to design a new information system, design the necessary hardware, and spec the necessary software. Once management purchased these components, technical assistance was provided to integrate the information system and customize the software to the business. It was estimated the system could be developed for $30,000.
Marketing is important for both the short-and long-term. It was discovered the firm lacked a formal, structured, comprehensive marketing plan. The development of a marketing plan was viewed as the foundation from which new business development could take place. A marketing plan was developed for $30,000.
Results
The recovery strategy highlighted two areas deemed critical for the continued operation of the business, management information systems (MIS) and marketing. On the MIS issue, the TAAC discovered that accounting, job costing, procedures, methods, and standards were not being captured in a manner that provided management with timely or useful information. A plan was developed to design a new information system, design the necessary hardware, and spec the necessary software. Once management purchased these components, technical assistance was provided to integrate the information system and customize the software to the business. It was estimated the system could be developed for $30,000.
Marketing is important for both the short-and long-term. It was discovered the firm lacked a formal, structured, comprehensive marketing plan. The development of a marketing plan was viewed as the foundation from which new business development could take place. A marketing plan was developed for $30,000.
Background
The firm is a manufacturer of thermoformed plastic products including covers and/or panels used in workstations, medical equipment, and business machines. At certification, the firm had 116 employees and annual sales of approximately $8.5 million.
This leading manufacturer of thermoformed plastic products faces the many challenges presented by tight competition and a soft economy. Customers have delayed shipment of their orders, reduced quantities, or have cancelled orders completely, prompting the owner to take a serious look at the entire business. It was made clear to management that obtaining new business was going to require aggressive tactics and the abilities of the entire organization to work smarter and more economically than in the past.
Assistance
The first and most important project was upgrading and integrating modules of the firm's "visual manufacturing" system, which would provide the firm with the ability to effectively handle and maintain the necessary information needed to manage individual customer orders from start to finish. This would give management and workers better access to vital and timely information for operating the business.
Results
The firm has gained a number of benefits from this successful project. First, the entire organization is now fully integrated. Order information is shared across a network and is available from any PC within the facility. Next, management now has the competitive tools they need to provide timely and accurate information to current and potential customers.
The results of this project exceeded management's expectations. Within a short time, sales increased over 30 percent and employment increased 13 percent. This project was also instrumental in fostering a stronger, more proactive partnership within the management team. Other tangible results include an increase in shop productivity resulting in more products being shipped correctly and on time.
Background
The firm is a family-owned manufacturer of screen-printed pressure sensitive labels and decals. At certification sales were $5.2 million and employment was 91.
Assistance
The recovery strategy focused on leading-edge technologies since success in this industry is driven by new, sophisticated technologies being introduced and produced. For this firm to remain competitive in the industry, it too had to be developer, leader, and marketer of advancing technologies. Specifically, management realized the need for new skills and tools to keep them on the leading edge, as well as the need for new product development.
The organization development strategy embraced by the firm, recommended the management team be trained in essential management/leadership skills, policies, and procedures. Specifically, skills in decision-making, conflict management, problem solving, negotiating, and overall business skills. Implementation assistance on Total Quality Management techniques was also provided.
Results
The project provided an opportunity for the managers to learn the skills required to manage their areas effectively. During the in-depth training sessions, two of the six managers realized their skills and expertise could best be utilized in other areas of the business. The training uncovered a need for a top-level manufacturing/operations executive. A search ensued and a new vice president of manufacturing operations was hired.
This project was also instrumental in fostering a stronger proactive partnership within the management team, which is now working as a cohesive group with common goals. Another impressive result from this development training is the partnerships the firm has developed and nurtured over the past 12-18 months that have translated to almost one-million-dollars in new sales.
The outcomes of this project have exceeded management’s expectations. Tangible results include the addition of new fulltime employees, investment in new capital equipment, and construction of an addition to the firm’s present facility. Most importantly, sales have increased over 18.5 percent and employment has increased 33.3 percent.
Background
The firm is a manufacturer of precision machined components used in the office equipment and computer industries. At certification the firm had 6 employees and annual sales of approximately $450,000.
The firm, founded in 1996, was experiencing a changing business climate that broadened the field for precision machining expertise. The owner was trying to position the firm to weather the changing climate by purchasing equipment capable of doing multiple tasks. Formation of strategic alliances is another industry trend affecting the firm's business approach.
Assistance
To generate new sales dollars, the firm needed a solid foundation to build from. Thus, the recovery strategy recommended development of a strategic business/marketing plan. This provided the firm with immediate tangible assistance that addressed short-term problems and provided a beginning structure for the firm’s long-term goals.
This plan of action created and organized the marketing function and included:
- Establishing realistic goals and objectives based on the firm's capabilities.Introducing the firm's management to relevant business/marketing techniques including market segmentation.
- Contact management, key account selling, and pertinent business management issues.
- Developing initial sales and marketing materials to support the firm's target markets.
- Creating a business/marketing program to achieve the firm's goals.
Results
The firm has a sound and accurate marketing plan that outlines a precise road map for the business including a detailed sales forecast. The sales forecast was developed for the short-term, with on-going adjustments as needed. Next, the project recommended, organized, and categorized appropriate sales and marketing tools vital to attracting new business and growing the current business. The combination of these two elements had a positive effect almost immediately putting the firm on track for a 25 percent increase in sales and a 67 percent increase in employment.
Other significant events happened due to this project. The firm relocated to a much larger facility (three times the size of its old building). A substantial increase in business has afforded the firm to purchase an additional CNC machine. With the assistance of the consultant, a newly restructured line-of-credit was made available to the firm by a business-friendly bank. The firm is also booking a four-month backlog, the largest in the firm’s history. One final result that cannot be quantified in dollars or cents is the owner's professed greater respect for business, equipment, people, and presentation.
Background
The firm, located in Utica, NY, began operations in 1936, producing cloth roll towel cabinets and towel processing equipment for the industrial laundry and linen supply markets.
After WWII, paper towels began replacing cloth towels for hand drying in the United States. This loss of market share continued year after year up to the 1990s. However, the past seven years has shown an increased demand for more environmentally friendly products such as reusable cloth over waste producing paper. The increased cost of waste disposal is another factor that is casting a more favorable light on cloth towels. In the late 1980s, the firm replaced its old metal cabinet with a new plastic dispenser, which represented the first design change in well over 30 years. At certification the firm had 22 employees and sales of $2 million.
Assistance
The TAAC completed a diagnostic review and an adjustment proposal that identified the need for improvement to the firm's computerized manufacturing and accounting systems. Sales revenue expansion had already been addressed in earlier technical assistance. The TAAC and the firm hired a consultant to develop an integrated Management Information System (MIS) that would run over a local area network.
The first phase of the project involved the evaluation and review of current systems and future needs. The consultant was then able to identify required hardware and software based on these findings. Both the firm and the TAAC agreed this phase was very successful. The consultant was able to lead management to purchase the exact needs at minimal cost.
Once the firm purchased the recommended hardware and standard software, the consultant spent his time on the complete implementation, installation, modification/customization, and training of essential personnel. The important component of this phase was the custom modification and enhancements. To reduce the up-front cost of software, a minimal system (including source code) was selected that met the core requirements of the firm. Extensive modifications and enhancements were then completed to ensure a successful implementation. All source code was then made available to the firm in the event modifications are needed in the future.
Results
In less than six months the firm has a system that is exactly designed for its business; and, with minimal training, personnel are able to understand and use the system. This project, along with a completed marketing project, has given the firm the necessary tools to be competitive in the existing marketplace.
Background
The firm is a manufacturer of custom foam and rubber applicators. At certification the firm had 132 employees and annual sales of $14.5 million.
Over the years, the firm became increasingly dependent upon a few large OEM customers. In order to remain competitive, many of these OEMs moved their entire operations to Asia and outsourced design, development, and product building to offshore suppliers that have the capabilities of delivering sub-systems to OEMs worldwide. Consequently, the firm’s parts and components sales suffered and remained exposed to further erosion in the future.
Assistance
The firm’s main concern was the purchasing function. Management was concerned that some key polices and procedures were lacking in this area, and with the large dollar amount this function is responsible for each year, a better structure was needed. Thus, the recovery strategy emphasized the need to evaluate the purchasing operation and analyze the firm's competitive bid process with the goal of reducing costs and implementing change.
Results
The firm gained a number of benefits from this successfully completed project. First and foremost, the project verified, without a doubt, the overall purchasing function is structured and operates very well for the amount of dollars spent annually. The project also organized and categorized the flow of purchased requirements. The project then set in place a procedure to improve inventory turns to 12 per year by altering the process of pulling against blanket orders.
The firm shortly realized annual dollar savings from this project of 11 percent, and management expects this to increase once everything is in place. Some of the savings can be passed on to customers.
The major result of the project is the confidence management regained in the purchasing structure. This project assured management the purchasing function is operating at optimum with the available tools and procedures now in place.