TORC UK Ltd
Assessment Details:
The following assessment brief refers to the TORC UK Ltd., Case Study which is attached.
Critically evaluate the integrated project and process management issues which will need to be introduced into this Company for it to remain competitive.
The report is to be written as a consultancy review for the attention of the Board of Directors of TORC UK Ltd.,
Assessment Brief:
Based in the West Midlands TORC UK Ltd., consists a manufacturing site, warehouse and sales branches. A producer of electric motors, power tools and pumps the company has grown by acquiring other companies (suppliers and customers). Whilst recognising the need to become leaner, agile and market-oriented, so far it has been constrained by factors such as site and space limitations, product design and quality, out-of-date manufacturing and production methods, poor distribution and marketing. The Company suffers from over-stocking, poor supplier relationships and varying lead times leading to an inability to forecast demand and react to market place changes in an effective and consistent manner.
Part 1 of your Report should cover the following:
A review of TORC UK’s Marketplace Positioning and Supply Chain Integration.
Compile a business case, resource allocations and timing feasibility study for improving the visibility of the company evaluating the characteristics of global supply chains and identifying what will be needed by TORC UK Ltd., that will:
a) Develop a more aggressive marketplace positioning strategy,
b) Introduce a rationalised product range to exploit the higher turnover available from more profitable products
c) Develop a marketing promotion campaign to include an on-line intranet and extranet capability in order to serve more international markets
d) Raise the Key Performance levels (such as Q.C.D.) within the new, and extended enterprise.
Integrated Project and Process Management Module.
CASE STUDY: TORC UK Ltd.
History and current situation.
The Company is based in the West Midlands but has geographically scattered locations of manufacturing sites, warehousing, sales outlets
Originally a producer of hand tools and electric motors, it has grown by acquiring other companies (suppliers and customers) along the way.
The company has identified the need to move towards becoming a lean operation with more efficient, effective and economic market-oriented systems, but has so far only succeeded in part, being constrained by factors such as site limitations and space, product design and quality, the scope and scale of the current manufacturing systems and methods of production, distribution and the market place position.
In addition the company has experienced over-stocking, worsening supplier relationships (as a result of slow payment of invoices) and varying manufacturing lead times in the product range. This has led to difficulty in matching variations in seasonal customer demand and the ability to react to market place changes in an effective and consistent manner.
The experience profile of middle management indicates a lack of up-to-date knowledge of best practice, low levels of qualification, a misplaced level of complacency and, often managers are regarded by the production staff as out of touch and unwilling to change.
The IT systems used by TORC UK Ltd., have been updated (in 2005/06) by acquiring the (Sage 200) Software package which is used to manage both the customer-facing requirements and the back-office processes, as well as the core retail/wholesale sales activities, the manufacturing and engineering costs. The software installation has helped staff work together more effectively and optimise resources. Management have gained access to company-wide information but it is not always updated or accurate.
However, the production department needs additional data to help access sales and purchase order processing, alongside stock control, project management and foreign trading transactions. Following a visit from a Sagesoft vendor recently, the IT Manager has been alerted to the possibility of adding a facility to handle supply chain, manufacturing and distribution management processes.
Some of the IT hardware equipment systems (i.e. those installed in the Retail Outlets and at the West Bromwich site) are slow in uploading and downloading data.
TORC UK Ltd. produces the following products:
• DIY power tools,
• A range of cordless electric screwdrivers,
• Electric motors for household appliances
• Garden pumps and accessories.
There is a wide range of customers ranging from large corporations to the general public. Products, supplies and sales are all affected by emerging global competition in various ways. The recent downturn in the UK based housing market has had a knock on effect on the UK’s Do-It-Yourself (DIY) market and so TORC UK sales in the current financial year (2008/09) are also suffering.
The products yielding most financial contribution are the power tools and the cordless screwdriver range. Whilst massive sales growth has been achieved over the past 2-3 years. the major UK based DIY chains, through which most of the larger volume orders for power tools are received, are tending to drive down profit margins to the lowest level possible. The consequence has been that the financial margins on sales have not only been suffering financially, and in the high seasonal demand periods (i.e. Christmas and Easter holiday time) particularly for the cordless electric screwdrivers customer order requirements have not been met in full.
The recent Waste Electrical and Electronic Equipment legislation (WEEE Directive) has placed extra resource demands on the company in setting up an internal infrastructure for collecting WEEE, so that customers of their products such as the private households have the possibility of returning WEEE free of charge.
The directive imposes the responsibility for the disposal of waste electrical and electronic equipment on the manufacturers of such equipment. Also, the company has been compelled to use the collected waste in an ecologically-friendly manner, either by ecological disposal or by reuse/refurbishment of the collected WEEE. Recovery of these items is expensive, rework and replacement of the failed motors has an equally cost negative effect on the business
(see Appendix 2 for recent prices, sales volumes, Quality control issues by product and average stock levels of the main components
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