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1. Describe the key systems and processes used by A. C. Gilbert:
a. supply chain
b. operational systems
c. product/service delivery.

2. Analyse the three key systems and processes and develop the elements of your review strategy. Applying your knowledge of quality management and continuous improvement theory, develop performance and sustainability measures, assessment tools and techniques that you would use to evaluate the effectiveness of the three key systems and processes.
In your report, include if applicable:
a. lists of key result areas (KRAs)
b. lists of key performance indicators (KPIs)
c. a description of performance review processes
d. a sample service level agreement.

Review of programs, systems and processes for continuous improvement

The report is developed to analyse the various important aspects of managing innovation within the organization A.C Gilbert, Australia and ensuring continuous improvements for enhancing the organizational efficacy. The report will discuss the major programs, processes and systems that are used to manage continuous innovation and improvements at the company through consideration of supply chain systems, operational processes and determining the key performance indicators to ensure successful delivery of products and services. A.C. Gilbert is one of the major toy manufacturing company and is known for its production of good quality erector set, which is a metal toy construction set (Davila, Epstein & Shelton, 2012). The performance objectives will be created to focus on the strategic goals, risk analysis and cost benefit analysis for implementing useful strategies to ensure improvements within the organization consistently. Lastly, the implementation of innovative processes is done to develop final action plans and contingency plans are considered to continuous evaluation of business outcomes and managing improvements in a continuous manner.

Supply chain is the flow of processes during the manufacturing and production of products and services managed with the use of raw materials and resources. This results in the production of finished goods that are delivered to the customer through the involvement of people, processes and resources used. The supply chain of A.C. Gilbert involves both manufacturers and wholesalers from whom the sellers purchase the raw materials, though managing own design and brand (de Oliveira Teixeira & Werther, 2013). The raw materials and supplies are plastic, metal, wood, textile, moulded components along with the materials used for packaging such as printed materials, can, box, etc.

The operational systems were used in the warehousing of data to manage the everyday transactions for A.C. Gilbert and ensure that the reliability and integrity of the data are maintained. The operational systems also included designing the products, prepare effective plans according to the requirements for resources and how the sales could be managed. The information obtained to gather enough raw materials for the production of products and management of packaging procedures were also part of the operational systems (Green, 2012). Finally, the finished goods of A.C. Gilbert were packaged and delivered to the warehouse where those had been stored and later transferred to the customers.

The products delivered included train sets, erector sets, chemistry sets and other items including microscope and engineering sets that have kept the customers satisfied for a long time. The quality of products was good enough and those had been packaged inside metal boxes to keep it safe. The sales team managed the orders placed by customers and the distribution team managed the products’ delivery by using contract transport before selling those to the consumers (Imai, 2012).

The major systems and processes have increased the organizational performance largely. The information about customers were assessed to fulfill their needs and requirements and check for any areas that need improvements to preserve the transactional data and make the business function effectively too. The operational systems include management of business operations within a diverse industry and manage the organizational structure, policies and practices properly to drive the business performance (Jacobs & Chase, 2013).

Key systems and processes used by A.C. Gilbert

The major areas where positive results are obtained have been supply chain management area,  production area and physical environment. The KRA, i.e., profit is facilitated by effective tax planning methods and by proper organizational administration. The sales and revenue generation area is another area where positive results are obtained such as invoicing, top line billing, etc. The people is another area where the positions, qualifications, wages structure, training and developmental needs are monitored. The systems, processes and technology are other areas where the human resources, financial and equipment resources have been managed wisely at A.C. Gilbert (Laudon & Traver, 2013).  

The KPIs are linked with the strategic objectives and few of these have been enabling proper approaches to maintain good customers’ services, manage marketing techniques, management of human resources to engage employees and reduce the level of turnover. Management of human resources is another key performance indicator that helps in engagement of employees, reduces employee turnover and provide enough scopes and time to fill the gaps for open positions (Marr, 2012). Cost is another component that determines how well the organization has performed while the customer metrics is another KPI that helped in delivering good customers’ services and generate good amount of profit through customers’ acquisition as well.

The performance review processes helped in monitoring the performances of the organization and evaluate the progress of manufacturing and production processes. This identified the areas of weaknesses and helped in evaluating the performances, furthermore approaches were undertaken to improve the performances of those areas and increase organizational productivity (Martini et al., 2013). By reviewing the performances, it was found that there was inappropriate management of human resources, leadership skills lacked, which resulted in less organizational production, and even some of the chemical lab toys were illegally used as inaccurate vintage toys.

Sample service level agreement (SLA)



Signature required

Date of approval

Name of company

A.C. Gilbert





SLA was one of the major aspects of key processes that defined the scope and even managed quality through management of responsibilities between the customers and the company. The SLA between the company and customers helped in provisioning of toys and services through which enough support could be provided. The involvement of stakeholders is essential for making the mutual agreements successful (Sanchez & Blanco, 2014).

Quality management and continuous improvement theory

Total Quality Management or TQM is customer based, service oriented method that helps in improving the quality of toys, and promote continuous improvements at A.C. Gilbert. Quality is managed with the help of quality planning, quality improvements and quality control techniques. Joseph Juran’s theory included gaining awareness of the scopes to make improvements in quality, identify the goals and objectives, provide training and development needs, monitor organization’s progress and performances and finally prepare a report to show the results (Stadtler, 2015). The improvements are identified and repeated until the highest quality is achieved.

The Kaizen’s theory was used by the organization to use a TQM system properly and improve the systems and processes to enhance the quality. This theory also identified the areas that need improvements and regular monitoring (Wathne & Heide, 2013).

Supply chain

Quality is the most important KPA, where the company has remained consistent all throughout. The good quality toys inspired many children and made them gain interest and skills to develop bridges, robots, etc.

Being one of the largest and oldest toy companies in the whole world, the organisation has acquired the Mechano and America Flyer to enhance its sales by introducing new toy trains too. Thus, the sales of the company increased largely and the profit level too (Wu, L., & Buyya, 2012).

Supply chain performance was quite good because the wholesalers and manufacturers were paid well for the raw materials they supplied for the company and this not only increased level of satisfaction among them too. The quality of raw materials like metal, wood and plastic was good, which helped in the production and delivery of good quality products too (Davila, Epstein & Shelton, 2012).

The human resources were managed properly and their needs and requirements were fulfilled. They were allowed to take part in making decisions, which further helped in motivating them to perform better and reduce chances of employee turnover (de Oliveira Teixeira & Werther, 2013).

The reputation of the organization dropped when the company started using cardboard box instead of metal boxes and even the long lasting toy parts were replaced with breakable parts. This deteriorated the quality of toys and made the customers dissatisfied, thus creating a bad image. Few strengths of the company included huge market share and string brand image and introduction of wide range of toys. Innovation of toys introduced new action figures that were promoted during movie premiers like James Bond, Transformers, etc (Green, 2012).

The customers‘services were not up to the expected standards because of the deterioration of employee performance. The sales and profit level dropped largely, thereby resulting in failure to establish new lines and cost of products. The products were expensive and quality deteriorated, which were definitely not value for money products available in the targeted market segments (Imai, 2012).

To develop a strong brand name, A.C. Gilbert could introduce new toys related to the movie for entering new markets and is considered as a major opportunity.

The production staffs, engineers, human resource workers and sales personnel of the organization should have been aware of the opportunities and developed digital platform to sell products online and make it convenient for the customers to buy products. The IT technical staffs would handle the e-commerce website with proper support by IT staffs and marketing consultants within the external environment to assess the market conditions and deliver products and service accordingly. The advertising experts must be skilled and knowledgeable to market the products online by targeting different market segments and understand the needs and equipments of customers easily too (Jacobs & Chase, 2013). Organic search engine traffic should be generated along with pay per click advertisements that could provide enough scopes for the company to generate good amounts of revenue in business.

As part of the continuing operations and business processes, A.C. Gilbert must move from its boy toys to production of toys for the girls too. To improve the performances, marketing and promotional strategies are designed to attract more customers and reach wider audience group. The quality of products deteriorated, which should be improved to create a consistent customer base. The organization must utilize the TQM system to improve the efficiency of business processes and enhance the products’ quality, furthermore making the employees informed about the areas that needed improvements (Cox, 2012).

Operational systems

Management of team is processed by the manager of the organization who administers and coordinates the team members by encouraging them to work as an unit and perform to their potential. The management of team is done through management of proper communication between the staffs, enabling them to work as a team set objectives and manage appraisal of performances. It could also help in identifying the issues and resolve conflicts, furthermore enhance organizational efficiency and productivity through effective leadership. Approval of team members is essential and the manager should agree to them regarding certain things before making an effective decision (García-Morales, Jiménez-Barrionuevo & Gutiérrez-Gutiérrez, 2012).  

The performance improvement strategy sets clear strategic goals and integrates the existing processes with the new processes. The manager of the organization takes the ideas and views of the employees before making any decisions with proper agreement.

The goals are to generate high amount of revenue and enhances the sales of the company.

The KRAs are costs, benefits, profit level achieved while the KPIs are positive brand name and image, diverse range of toys and introduction of many new lines to attract more customers (Grötsch, Blome & Schleper, 2013).

The company was closed due to certain reasons and if it was not closed, certain changes and improvements were needed to be done including the involvement of organizational staffs so that they can discuss and provide their useful opinions before making any decisions in business

Creative techniques include extracurricular activities, training and developmental sessions that could be provided to them to enhancing their level of skills, creativity, knowledge and expertise level (Karpagam & Suganthi, 2012).

The manager should have considered the views and responses of employees before making any decision and even encourage the group members to identify the potential issues and furthermore resolve the issues properly.

In case of any mistakes, failures should be accepted rather than becoming over reactive and provide vague explanations to the risks caused (McLean & Antony, 2014).

The leadership strategy would help in improving the structure of the organization by setting organizational goals properly and introduce new products one by one, rather than introducing 50 new lines within just a year. The opinions of employees must be assessed through high levels of motivation and encouragement to make them perform to their potential. To manage approval by group, training is also provided to the workers to enhance their skills and knowledge level (Montibeller & Winterfeldt, 2015).

From the case study, it could be understood that a loss of $281,000.00 was recorded and to overcome this kind of issue, A.C. Gilbert should revise the strategies prior to the implementation process.

There are several risks associated with the business trends and technological innovations, because of which, the risk analysis strategy must be implemented to identify the risks and determines the probable impacts created (Pophal, 2015).

The cost benefit analysis is a systematic approach used to determine the strengths and weaknesses of the company and evaluate its business activities and requirements. It is done to determine the best option available for fulfilling the requirements and achieve the benefits though enabling management of savings all throughout. It could compare the benefits and costs and implement policies by A.C. Gilbert to determine whether the investment decision could bring feasible outcomes or not and also check the expected cost against the benefits that had been expected (Ruiz-Torres et al., 2013).

Product/service delivery

The manager must be cautious about the emergence of risks and evaluate the costs and benefits before implementing a strategy. The manager should evaluate the costs that would be incurred for the implementation of new technologies and even check things that would be required by the human resources to mange good productivity. By assessing the costs, risks, the manager would approve the strategy to be implemented (Schiuma, 2012).

The innovative process that could be implemented by A.C. Gilbert had been the use of ad tech, social media involvement and management of omnichannel marketing.  Nowadays, with the introduction of new technologies, social media involvement has become a effective way of marketing through online advertising and offline merchandising for enhancing the sales. Social media involvement could also help the company to increase the customer base and enhance its sales revenue (Slack, 2015).

The omnichannel marketing mighty also help A.C. Gilbert to deliver seamless and better quality services to people and make customers get engaged with the physical store, online app or website and even through social media. This would allow the customers to access the products and services by communicating with the business online or offline and this would have surely facilitated and promoted better consumers’ experiences consistently (Trapp et al., 2015).


  • The sales were increased by 50 percent.
  • New leader was appointed as the CEO
  • Profit level was quite low because of the decline in quality and reduction of investments or spending, which showed that the company’s performance was not satisfactory.
  • Changes were not implemented and the new lines were not sufficient for capitalizing on the recent trends


  • To increase sales staff by 50 percent
  • To use the television advertising for increasing sales revenue
  • To form long lasting relationship with the customers and generate revenue in business
  1. activities to promote the process and sustainability

To promote sustainability, environment friendly approaches were undertaken and the toys were made with good quality materials supplied by the suppliers. The wastes were renewed and harmful gases were not produced to ensure that an ecological balance in nature was to be maintained (Zhu, Sarkis & Lai, 2012).

  1. activities to reduce any negative impact on people.

Risks are mitigated through maintenance of environment friendly approaches for preventing pollution and ensure that the healths of human beings are not deteriorated. The wastes of the company were needed to be recycled or incinerated, rather than throwing those here and there, which could also harm the environmental condition. Harmful carbon emissions are also prevented to the utmost level possible (Cox, 2012).

The contingency plans could be providing rewards and incentives to the workers, to keep them motivated to perform better and follow the risk assessment strategy to assess the risks and create an effective plan to resolve those and gain benefits. The contingency plans could also resolve the supplier related issues and check that good quality raw materials and supplies were provided for the process of manufacturing and production (Grötsch, Blome & Schleper, 2013).

The issues of implementing contingency plans include lack of motivation and encouragement, inaccurate analysis and inability to forecast risks.

The actions plans and contingency plans are integrated to identify the issues regarding implementation and ensure that the challenges and issues are overcome with ease and efficiency. Based on plan for taking actions, the contingency plans are developed to check out for the mistakes and resolve those (Karpagam & Suganthi, 2012).

Activities for evaluation and continuous improvement

Time frame

Procedures of evaluation

10 days

Assessment of organizational requirements

15 days

Management of human and financial resources

10 days

Learning processes

8 days

Implementation of strategies

15 days

Contingency plans

6 days


64 days


The report was prepared to manage innovation and ensure continuous improvements with the consideration of the business organization named A.C. Gilbert. The systems and processes used to bring out positive results in various areas and even determined the key performance indicators that proved to be beneficial for the success of the company. The promotion of value, creativity and innovation was done so that the company could find success within the business environment. The omnichannel marketing and involvement of new technologies could have stopped the ultimate fate of the company and even might have brought the expected profit level for the organization with much ease and efficiency.   


Cox, L. A. T. (2012). Confronting deep uncertainties in risk analysis. Risk Analysis, 32(10), 1607-1629.

Davila, T., Epstein, M., & Shelton, R. (2012). Making innovation work: How to manage it, measure it, and profit from it. FT press.

de Oliveira Teixeira, E., & Werther, W. B. (2013). Resilience: Continuous renewal of competitive advantages. Business Horizons, 56(3), 333-342.

García-Morales, V. J., Jiménez-Barrionuevo, M. M., & Gutiérrez-Gutiérrez, L. (2012). Transformational leadership influence on organizational performance through organizational learning and innovation. Journal of business research, 65(7), 1040-1050.

Green, T. J. (2012). TQM and organisational culture: how do they link?. Total Quality Management & Business Excellence, 23(2), 141-157.

Grötsch, V. M., Blome, C., & Schleper, M. C. (2013). Antecedents of proactive supply chain risk management–a contingency theory perspective. International Journal of Production Research, 51(10), 2842-2867.

Imai, M. (2012). Gemba Kaizen: A commonsense approach to a continuous improvement strategy. McGraw Hill Professional.

Jacobs, R., & Chase, R. (2013). Operations and supply chain management. McGraw-Hill Higher Education.

Karpagam, U. P., & Suganthi, L. (2012). A strategy map of balanced scorecard in academic institutions for performance improvement. IUP Journal of Business Strategy, 9(3), 7.

Laudon, K. C., & Traver, C. G. (2013). E-commerce. Pearson.

Marr, B. (2012). Key Performance Indicators (KPI): The 75 measures every manager needs to know. Pearson UK.

Martini, A., Laugen, B. T., Gastaldi, L., & Corso, M. (2013). Continuous innovation: towards a paradoxical, ambidextrous combination of exploration and exploitation. International Journal of Technology Management, 61(1), 1-22.

McLean, R., & Antony, J. (2014). Why continuous improvement initiatives fail in manufacturing environments? A systematic review of the evidence. International Journal of Productivity and Performance Management, 63(3), 370-376.

Montibeller, G., & Winterfeldt, D. (2015). Cognitive and motivational biases in decision and risk analysis. Risk Analysis, 35(7), 1230-1251.

Pophal, L. (2015). Multichannel vs. Omnichannel Marketing: Is There a Difference, and What Does It Mean to You?. Econtent, 38(2), 15-+.

Ruiz-Torres, A. J., Mahmoodi, F., & Zeng, A. Z. (2013). Supplier selection model with contingency planning for supplier failures. Computers & Industrial Engineering, 66(2), 374-382.

Sanchez, L., & Blanco, B. (2014). Three decades of continuous improvement. Total Quality Management & Business Excellence, 25(9-10), 986-1001.

Schiuma, G. (2012). Managing knowledge for business performance improvement. Journal of Knowledge Management, 16(4), 515-522.

Slack, N. (2015). Operations strategy. John Wiley & Sons, Ltd.

Stadtler, H. (2015). Supply chain management: An overview. In Supply chain management and advanced planning (pp. 3-28). Springer Berlin Heidelberg.

Trapp, M., Laub, K., Wern, B., SDU, L. H., Depuydt, T., UV, D. B., & Di Berardino, S. (2015). COST-BENEFIT-ANALYSIS.

Wathne, K. H., & Heide, J. B. (2013, May). Relationship governance in a supply chain network. American Marketing Association.

Wu, L., & Buyya, R. (2012). Service level agreement (sla) in utility computing systems. IGI Global, 15.

Zhu, Q., Sarkis, J., & Lai, K. H. (2012). Green supply chain management innovation diffusion and its relationship to organizational improvement: An ecological modernization perspective. Journal of Engineering and Technology Management, 29(1), 168-185.

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