Overcoming Challenges: Precision Engineering Works Private Limited In The Telecommunications Industry

Precision Engineering Works Private Limited (PEW) is an original equipment manufacturer specialising in plastic moulding parts for the telecommunication industry. They have been servicing the industry for almost 30 years and their customers include major telecommunication service providers. Due to its reputation, PEW have become a very successful company.

However, as this industry is seen as a very lucrative market, many new suppliers have begun to emerge. This is having serious implications for PEW. It is more difficult to win new contracts as their customers are able to explore options with other suppliers. Additionally, the competitors are also providing better pricing than PEW. These factors combined have eroded PEW’s profitability by almost 45%. As more suppliers are flooding the market, many of PEW’s experienced employees have opted to join the new players.

PEW’s senior management are concerned with the recent developments and are looking at ways to improve and once again become the preferred supplier to their customers. To this effect, PEW has engaged your company to provide some advice on overcoming the above issues. The management team is willing to provide all necessary support to turnaround the situation. They want all issues to be resolved within three (3) months.

This assessment item requires you to work in a GROUP (no more than 3 students)

1. As a business improvement consultant, you and your team (including members from PEW) have only three (3) months to correct the situation. You would needto:
   1. Identify the root cause(s) that lead to the problems using appropriate tools and techniques.
   2. Develop a continuous improvement plan to ensure the problems and issues are not repeated.

• Elaborate on the competencies required from PEW management and employeesto effectively bring about the change
  
  

Background of Precision Engineering Works Private Limited

In the present era, the project management is essential for every business to achieve their strategic goal and objectives with the available resources (Meredith& Mantel Jr, 2011). In this regard, the project management facilitates for the effective design, schedule and implementation of the business plan to overcome the business problems faced by the company (Kerzner & Kerzner, 2017). In the same manner, the Precision Engineering Works Private Limited (PEW) is the one of the topmost manufacturers of the plastic molding parts for telecommunication industry. The business faces the problems in revenue generation due to highly competitive rivalries. For this purpose, current report is being prepared to address the issues of the business and resolve it within the time span of three months. In this context, the present report identifies the root cause of current problems with the help of seven different tools and techniques. Further, on the basis of identifying the root cause analysis, the continuous improvement plan suggesting with the project quality management tools as Prince 2 and Total quality management (TQM) has been prepared. In the end, the several business competencies are described for the effective implementation of the continuous improvement plan.

The plan of the business is based on the following assumptions-

• Products offering not according to the current scenario of the market.
• Dissatisfied employees.
• The rate of return of the business is going down
• Low technological upgradation is affecting the performance
• Clients are highly demanding and innovative products are needed.
• Marketing strategies are not capable of grabbing the attention of clients

The identification of the root cause is necessary for the PEW to increase their financial output of the business. In this regard, the following tools are helpful to understand the basic cause of the current business problems.

In the identification of the root cause, the fishbone diagram analyzed all the factors which are accountable for the main problem (Jayswal, Li, Zanwar, Lou & Huang, 2011). In the same manner, for the PEW the fishbone diagram helps to understand that why the problem is occurring. In this regard, with the help of fishbone diagram the main cause of the problem of the PEW is identified wherein increased amount of the competitors in the market which offer the attracting pricing for the customers. All of these create the barrier to the financial outcome and also degrade the market reputation.

Thus, the increased competitors, low innovative offering and low focus on the employees’ retention are the basic cause for the financial degradation of PEW. Owing to this, it is necessary for PEW to set the focal point on the production of the innovative product and several strategies to retain the customers as well as employees and enhances their company’s performances in the market.

Challenges Faced by Precision Engineering Works Private Limited

The 5 Why's help to understand the key reasons behind any problem (Leveson, 2011). In this regard, the below-described table consist of the 5 Why's and their responding answer to identify the accurate reason for the financial problems.

Table 1: 5 Why's for PEW

On the basis of the above table, it is found that the employees’ dissatisfaction is the main reason for the poor performance of the PEW. Further, it also affects the quality of the products. Owing to this, the consideration of the employees’ satisfaction and retention is necessary for PEW to improve the quality of the product.

The quality of the PEW product is not good with the comparison of the other suppliers in the market. Due to this, it is necessary for the PEW for identifying the key source which is accountable for the low-quality product comparison to other suppliers in the production process. In this context, the following table of Is/Is not analysis helps to analyzes the influencing and non-influencing aspect through the product.

Table 2: Is/Is not analysis

Therefore, the Is/Is not analysis helps to understand the affecting and non-affecting aspect of PEW problem in the business (Doggett, 2005). Therefore, to improve innovation aspect of the product, it is necessary for PEW to bring innovation in the manufacturing process and enhance the involvement of the employee's opinion in the manufacturing of innovative products.

As per the above root cause analysis through the fishbone diagram and 5 Why's the employees' dissatisfaction is the main reason of the company’s failure in the market. In this regard, the failure mode and effect analysis technique help to recognize the voluntary reason behind the employees' dissatisfaction (Liu, Liu & Liu, 2013). In this manner, the following table identifies the failure mode and their effect on the organization.

Table 3: Failure mode and effect analysis for PEW

According to the above table of the failure mode and effect analysis of the employees' dissatisfaction, the low awareness of the management of PEW for creating rules and policies for the employees with the comparison to other competitors is the main reason of employee turn-over. Owing to this, the PEW employee does not focus on their job task which enhances the employees’ burn out in the organization.

The affinity diagram combines all reasons for the current problem in an effective manner (Hanington & Martin, 2012). In this regard, high employees' turnover, customer switching and low innovation in the product are the key problems of the PEW which identified from the above-mentioned tool, which has the negative impact on the business and creates the barrier in the achievement of the new contract from the existing and new customers. In this context, the affinity diagram helps PEW management to understand that how these factors affect the competitive edge of the company.  

Tools and Techniques to Identify the Root Cause

Table 4: Table of Affinity diagram’s factors and subfactors for PEW's issue 

According to the above discussion, the high availability of the substitute in the market is the main cause for the customer switching. Similarly, low employee’s engagement creates the causes for the high employees' turnover. At the same time, the low attention for bringing innovation in the business affects the innovative aspect of products.

The force field analysis helps PEW to understand the supportive and against forces from the different cause of the current issue in the revenue generation (Timans, Antony, Ahaus & van Solingen, 2012). In this regard, the following diagram of force field analysis helps PEW to consider those issues which negatively influence the profitability of the business.

On the basis of the above diagram, the high reputation in the market, variety of the product, product marketing and the quality of the product are important aspect for the growth of the business. On the other hand, the high availability of substitutes, low employees’ satisfaction, low innovative product and low attractive offering forces are not in the favour of PEW (refer to figure2). At this juncture, it is crucial for business to focus on the growth related aspects and determine the success of the project with the increased rate of return. Owing to this, the PEW can improve their performance in the market through the effective utilization of these supportive forces.

The CATEWOE analysis leads the role of different stakeholder in the business problems (Wang & Chen, 2012). In this context, the CATWOE analysis helps PEW to understand the accountability of the several stakeholders in the current business problems. In this regard, client, actors, transformation, owner and the environmental constraints are the key aspects of any business problem. In this context, for the PEW these key aspects are described below.

• Clients-The telecommunication service providers are the key clients of PEW and any issue in the innovative product manufacturing has the direct impact on the offering for the customers.
• Actors-For the PEW the employees are the main actors who resolve the current issue of PEW in profits generation.   
• Transformation- In this stage, the actors of the PEW implement the strategies for overcoming the business problem.
• Weltanschauung- At this stage, the impact of the transformation process on the organization with the broad perspective is analyzed and understands the impact of the above process is positive or negative.
• Owner- The management personnel of the PEW is accountable for the decision making for the project management. Further, management is also responsible for the continuous implementation in the improvement plan.
• Environmental constraints-In the context of PEW the other competitors are the major environmental constraints which construct the complicated situation in capital income of the company.

On the basis of root cause analysis for PEW, the main causes are the low focus on innovation, strict policies for employees and low focus on the modern marketing strategies. In this regard, the following diagram consists the process of the continuous improvement plan.

It is the first’s step of the improvement plan, wherein the continuous plan is initiated. In this regard, the following benchmarks are set to address the above-identified issue in the PEW.

• To bring innovation to the company within 30 days.
• To increase the sales of the product up to 20% in 50days.
• To increase product marketing through the modern technological platform in 45 days.
• To enhance the employees' retention by 15% in 30 days through adequate policies.
• To enhance the market reputation with effective business strategies within 60 days.

Resource requirement

In order to achieve above discussed benchmark and bringing innovation into the business process, the following resources are required which helps to effectively overcome the current business problems of PEW.

• Skilled human resources are required for research and development of the business process. In this regard, expert human resources required for the market analysis and project development.
• Physical resources as machinery and technical equipment are required to change the all production process.
• Financial resources are also required.

Continuous Improvement Plan for Precision Engineering Works Private Limited

Strategies to address the issues

To address the issues which are resulted from root cause analysis, the Prince 2 project quality assurances tool will help to enhance the quality of the project. In this context, the project manager in the PEW divides the process of the project into several stages as first; understand the current customers' requirement through analyzing the market than develop the products.

On the other hand, the project manager monitoring the process of the progress according to previous set benchmarks. At the same time, the mangers predict the future risk and build strategies to avoid unexpected result of project. Thus, the continuous improvement plan with the effective project quality management tool as Prince 2 helps PEW management to effectively implement improvement plan with the high-quality standard (Ghosh, Forrest, DiNetta, Wolfe & Lambert, 2012). Further, it supervises all the aspects of the project and resulted as qualitative outcome from the project

Apart from these, the quality of the product is the main issue which affects the success of the products in the market. In this regard, the TQM enhance the quality of the products. In this context, the project manager of PEW, streamline the all the supply chain activity to improve the quality of the product (Das, Kumar & Kumar, 2011). This is because the suppliers of the organization are liable for the product quality to a great extent (Hoang, Igel & Laosirihongthong, 2010). Owing to this, the PEW finds the topmost suppliers and builds the healthy relationship with them for the effective supply of the raw material.

Moreover, the PEW will focus on the technological innovation to improve all the aspects of the products including customer requirement, product quality and product cost (Kim, Kumar & Kumar, 2012). In this regard, the management of the PEW understands the customers’ requirement through different communication method such as regular feedback from the customers through social media. In this context, the manager focuses on the technical ability of employees and encourages the employees to enhance the communication with the clients. Further, the management provides the training to employees for the uses of new machinery for effective production. Owing to this, the PEW managers are able to bring innovation into the company and enhance the company's productivity with cost leadership.

Review the performance

For gaining the proposed outcome of improvement plan, the project manager analyzes the result of plan in regular time span. In this context, they ensure the improvement plant performance on the basis of previous set benchmarks.

Modification or improvement

On the basis of the review, the managers analyze the requirements of the modification in the current plan. After that, the managers implement the changes in the current plan. Then this process will remain in a continuous manner.

In order to achieve the proposed outcome of the continuous improvement plan, the PEW management should have great competencies in below mention management aspect.

To overcome the present issue in the company and effective implementation of the improvement plan, it is significant for PEW managers to use sounds strategies through which employees are easy to understand the main purpose of the strategies and able to implements in the current business operation (Hill, 2017). Further, with the help of effective business management, the PEW managers can enhance the competitive edge of the company in the market.  

For bringing innovation in the firm, it is necessary for PEW management to effectively manage the technical resources for the production as well as communication. In this context, the management train the staff member for the utilization of the technical resources and the production process without any technical barrier (Tao, Zuo, Da Xu & Zhang, 2014). Further, the effective technical management enhances the communication skills of the employees with technological up gradation (Leonardi, Huysman & Steinfield, 2013). Owing to this, the technical management is an essential competency for PEW managers to gain the proposed result of the improvement plan.

The leadership is the most necessary key competency for the PEW management to enhance the competitive edge of the company through the effective leadership style.  In this regard, the leaders in PEW must have the situational leadership to organizing the regular operation and improvement process in an effective manner (Anantatmula, 2010; Yang, Huang & Wu, 2011; McCleskey, 2014). In this context, the leaders use an autocratic leadership style for enhancing the commanding over the employees (Mitchell, 2013). Further, for the successful execution of the continuous improvement plan the leader must use the transformational leadership style (Warrick, 2011). Due to this, the leaders motivate the employees for the change in the current business procedure.

Apart from this, the project manager should use the transactional leadership style to improve the performance of the current project. This is because the transactional leadership enhances the productivity of the particular groups (Rupp, 2011). In this regard, the leaders give monetary and non-monetary benefits such as promoting the salary as well as designation to enhances the motivation in the employees (Tuuk, 2012). Owing to this, the leadership enhances the effectiveness in the proposed outcome of the continuous improvement plan.

Conclusion

On the basis of the above report, it has been concluded that the effective project management helps the company for reducing the problems in the business process. Apart from this, the tools of root cause analysis improve the management capabilities to understand the main causes of the business problems. Thus, the management effectively addresses the main issue and formulate the appropriate strategies. On the other hand, it can be concluded that, for effective project management, the leadership, technical management and strategic management are key competencies which must be required. Therefore, the successful project management includes the identification of basic problems, the improvement strategies with require competencies and enhances the company's performance in the market.

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