Paper Example on TAM's Growth: From $1M to $25M in 2009 Under Jack's Management

Introduction

Tea and More has steadily grown its revenues from the time it was acquired by Jack and his fellow partners. From a revenue stream of $1 Million to revenue of $25 Million in 2009, it is evident that the company was under good management and had solid operating procedures. Jack, after the acquisition of TAM, was able to imaginatively rebrand it and it re-emerged as a new company, gaining new consumer bases and maintaining its existing consumer base. However, TAMs growth became its undoing as Jack, who had become the sole owner of the operation, implemented an aristocratic rule over the employees. Hence, despite the formation of various managerial/executive level posts, the said persons were not allowed decision making roles. They all reported to Jack first before executing any decision.

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Major Problems from the Case Study

The major problem plaguing TAM is the lack of delegation, by the sole proprietor of the company, Jack. From the case study, it is evident that Jack has taken it upon himself to make all the managerial decisions. Additionally, he does not seek expert advice on the supply chain processes in TAM and further, does not seem to care much about the well-being of his employees. Jack is experiencing burn-out and is thus seemingly stressed about making decisions. His stress is evident in the 'threatening' emails he sends to the staff.

Maddening delays and mix-ups in production: The mix-ups clearly show there is an issue in the supply chain of TAM, additionally, there is little to no process refining as there are frequent delays.

Remuneration issues: The sales teams at TAM feel that they are given too much duties/expectations, in-addition-to of the traveling they are expected to do, possibly when marketing TAMs products, in comparison to what they are being paid.

Leadership/Managerial issues: Jack seems to micro-manage every aspect of TAM, thus, his managers and other employees' feel they are under constant supervision and monitoring. This acts against principles of leadership and management, that would seek to empower employees to work without supervision.

Possible Solutions

The concern for poor customer relations can be remedied by employing more full-time customer service agents. This, however, should be done in proportion to TAMs financial capability. By employing more full-time customer relations executives, the account holders will not feel neglected or less important as compared to bigger accounts. In addition to this, small account holders should be given more incentives, so as to encourage them to boost their account share/business with TAM.

Consumers and other stakeholders within TAM are all looking for one thing, consistency. They wish to see the TAM brand on their shelves irrespective of the season and at the same cost. Additionally, TAM should be dynamic enough to cater to the changing tastes of its consumer base. This will ensure that TAM is always at the forefront in the coffee business and additionally, has a strong hold on its consumer base.

The issue of stock outages and irregular customer orders can be met by a multi-faceted approach. First, is diversifying the acquisition of raw material/coffee from EML to other, closer suppliers. This will not only save on shipping costs but will give TAM the 'breathing space' it requires if they need to change an order, with respect to current demand. Furthermore, having more suppliers who are close to the base of processing in Cleveland implies that it will take a shorter time to meet a sudden demand for a product. The concern of irregular purchase orders can be solved by increasing the storage capacity of the processing plant and additionally by diversifying the distribution chain/centers. Having more depots close to the majority of the consumer base will shorten delivery times and costs, hence making retailers more open to purchasing stock, even in sudden demand.

The solution of having more depots close to the retailers also serves to reduce the collection time from 50 to 40 days. Additionally, the existence of multiple suppliers who are closer to the Cleveland plant ensures that TAM does not have to wait for its main supplier EML to deliver its stock.

There is a need for TAM, like any other consumer-based operation, to diversify its product range. However, TAM needs to establish a dedicated Research and Development wing that is not under Jack's direct control. This branch will experiment with existing and new brands and see how well their uptake can be in the current and new markets before the products go to full production.

TAM needs to establish a dedicated ERP with all its key suppliers and retailers. This should have an inventory management system that will enable TAM to prepare stock it sees running out on the retailer's end and also will enable its suppliers to prepare stock to deliver to TAM. This information system will also deliver sales vs inventory statistics to TAM, which will enable it to streamline its operations financially.