Situation Analysis and Problem Statement - Riordan Manufacturing

SITUATION ANALYSIS AND PROBLEM STATEMENT: RIORDAN MANUFACTURING

Situation Analysis and Problem Statement

In today's business world in order for an organization to walk the path of technological advancement, increasing profits and remain one step ahead of the curve businesses must possess the ability to solve problems effectively and efficiently. There are different ways to approach defining the problems facing an organization; the focus needs to be on defining the problem correctly (University of Phoenix, 2004). Situation analysis is a widely used tool and is often termed the "three c's" and refers to three major elements: customers, costs and competition" (Wikipedia contributors, 2006).

The context of the paper will examine the case study of Riordan Manufacturing and provide an in-depth situation analysis starting with a brief background of the scenario, identify the issues and opportunities, explore stakeholder perspectives and ethical dilemmas. Continuing through the problem definition guidelines, a problem statement will be developed and end state goals will be identified.

Situation Background (Step 1)

Riordan Manufacturing is an industry leader and global plastics producer and broken into three plants: plastic beverage containers in Albany, Georgia, custom plastic parts in Pontiac, Michigan and plastic fan parts in Hangzhou, China. They are wholly owned by Riordan Industries and employ over 550 people in the United State and China (University of Phoenix, 2006). Sharply declining sales, market share and uneven profits over the past two years has left Riordan Manufacturing in an industry of consolidation and extreme competitiveness. These industry changes has prompted Riordan Manufacturing to reevaluate their sales and manufacturing processes and they have implemented a Customer Relationship Management system, better known as CRM, and self-directed work teams. Specifically, the CRM system consists of sales teams, which includes a sales person, product engineer and customer service rep, versus the traditional single sales person.

A recent employee survey showed a significant decline in overall job satisfaction, particularly in compensation and benefits, and has left Mr. Michael Riordan, Founder, President and Chief Executive of Riordan Manufacturing, to consider the following options:

1) Completely overhaul the reward system, or

2) Use piecemeal solutions to address the most critical issues, or

3) Find new motivational strategies

A consulting firm, Human Capital, has been hired to conduct interviews with employees, departmental managers and the leadership team to narrow down the specific areas of concern. Their task at this time is to provide a summary of their findings, suggested changes and proposal for implementing and managing recommended changes.

Issue Identification

There are four primary issues outlined in Table 1 which Riordan Manufacturing has encountered as they continue through the implementation cycle of the CRM system and self-directed work teams: team conflict, employee turnover, organizational culture and climate, and declining sales and customer.

There is no presence of a unified front or cohesiveness in the leadership team. They appear to have conflicting goals and view points which have resulted in dysfunctional conflict, lack of respect and understanding of each others job functions and ineffective communication. With the ambitious goals of an organizational transformation, rolling out new products, reducing employee turnover and improving sales and customer satisfaction, there has to be a sense of "we-ness" in order for the plan to be successful.

One of the many challenges Riordan Manufacturing faces in turning sales around is high employee turnover. Developing and rolling out new products and services and implementing a CRM system will not achieve the sales goal alone. The key is having a knowledgeable sales force ready, willing and able to embrace and market these products and services in order to increase sales, client satisfaction and gain market share.

There seems to have been an ineffective rollout of the new CRM system and self-directed work teams and has led to increased employee frustrations, higher turnover and an overall decrease in job satisfaction and negative organizational climate. The trickle down effect of this is an increased push on remaining employees to pick up the "slack" until new employees can be hired and brought up to speed and a decline in customer satisfaction.

Opportunity Identification

There are four opportunities