Case Study of a Company's Output Strategy

The company gets the orders from the distributors; the information is then used to schedule production scale and time. The individual responsible for mixing obtains the list of cookies scheduled for production at the start of each shift. Each cookie type has different ingredients in the master list. The ingredient information is fed into the computer which then determines the mixing ratio based on the quantity demanded, relaying the information to the ingredient storage silos. The mixing machines receive the ingredients from the silos and combine them with water, eggs, and flavoring then batter poured into the cutting machine that divides cookies into small portions. The cookies are then transported through a conveyor belt for cooling and packaging.

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Increase in productivity has been achieved by using automation and by increasing the length of the baking ovens. The automation of the production process reduces the time used in calculating the mixing ratios, ensuring effective and efficient baking process in overall. The increased length of the ovens maximizes the number of cookies that can be baked at the same time.

By not automating their packaging process, the company is making the right decision. From the case study, the company production capacity is dictated by the distributor's orders. The 30 women packaging workforce seems efficient to do the packaging in good time. The company could be using much than they should if they resolve to use machines, but their good social standing with their community by employing them is more important and beneficial than the amount of money they could save (Sarkis & Daou, 2013). In case the company feels that automation in packaging is a must, the management must give alternative employment in other sectors to the people who will be affected. The size of the town matters in this case. If the location is to be shifted to a larger town, the operational costs will increase (Browne, Sharkey Scott, Mangematin, & Gibbons, 2018). The size of the company is a factor; were it larger, it would need automation in packaging to meet the standards and the time.

The company sticks to a limited number of inventories to avoid wastages and losses. The losses are likely to be incurred if the labels are kept in huge bulks and then the FDA label requirements are changed before the labels, cookie boxes, shipping boxes are used. This policy reduces the likelihood of materials going to waste due to such avoidable eventualities (Browne, Sharkey Scott, Mangematin, & Gibbons, 2018). The essence is to cut down a possible loss whenever it is sensed.

As a consumer, I judge the quality of the cookies that I buy based on their naturalness. I take precaution on the number of additives and preservatives that are added to the cookies. The sugar content of the cookies is important too. Very high amount of sugar, additive, and preservatives means the manufacturer does not value the health of customers; therefore that is a low-quality cookie in my assessment.

By preparing cookies without preservatives, the company is getting the advantage of curving itself a niche among the health-conscious customers. This is likely to boost sales because the market today is leaning on the campaign for healthy foods (Browne, Sharkey Scott, Mangematin, & Gibbons, 2018). The limitations are that on low business seasons, they may incur huge losses because the cookies might expire (Xuenan Ju, 2017). This can be tamed by producing the cookies based on orders.

The company's business strategy is called "the product differentiation strategy." This is a system whereby a company curves itself competitive advantage over other establishments in the market by producing unique products of superior quality (Xuenan Ju, 2017). The cookies produced is different because it has no additives, preservatives and has low sugar content. This strategy will help the company identify with the customers as the most health-friendly cookie producer in the market.

References

Browne, S., Sharkey Scott, P., Mangematin, V., & Gibbons, P. (2018). Shaking up business models with creative strategies: when tried and true stops working. Journal of Business Strategy, 4-7. doi:10.1108/JBS-08-2017-0121

Sarkis, N., & Daou, L. (2013). Giving back to the community, an obligation or an option today?"-Case of the educational sector in Lebanon. International Strategic Management Review, 59-64. doi:https://doi.org/10.1016/j.ism.2013.09.001

Xuenan Ju, L. T. (2017). Determinants and Consequences of Product Differentiation Strategy: Evidence of Chinese Indigenous Exporters. International Business Research, 60-72.