ZZZ Global Computers: Facing Challenges & Needing Strategies - Essay Sample

Introduction

The profitability of ZZZ Global Computers has been decreasing gradually, and the trend is bound to continue if not corrective action is taken. The decreasing repute and profit margin can be attributed to poor operational executions. The company needs new strategies to increase the quality and durability of its products, operations management, employee management, and customer care services.

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In recent years, the company has been facing several internal and external challenges. The technology and software used in different outlets are not compatible due to aggressive mergers and acquisitions initiated by the company in the previous three years. ZZZ Global Computers has continuously been affected by high costs of production in the development of its products. Over the past nine months, many key employees have left the company; moreover, inadequate project management skills have led to the failure of crucial projects initiated to improve the company's performance. The active workforce is not flexible or adaptable; they can only specialize in at most two operations. Also, ZZZ Global Computers lacks performance metrics to show how internal stakeholders are progressing.

A few issues have been noted with the effectiveness of the company's management techniques. ZZZ Global Computers is using the job process, small-batch, large batch, line process, and hybrid cell manufacturing strategies; however, the company is not efficient in these manufacturing processes. In some outlets, the manufacturing layouts are not effectively designed, and most of the production operations are not well coordinated. The documentation process is done manually by 17 full-time employees; this group is three months behind schedule. These disturbing trends have primarily affected the company's perspective market.

ZZZ Global Computers has been facing problems with its customer base due to infective customer care, the quality of products, and logistics challenges. Customers are continually canceling new orders because the company is not meeting their delivery demands and requests. Moreover, the company lost its biggest client in Europe due to inadequate application of risk management techniques, project management planning, diagramming of networks, work breakdown structures, active schedule development, and execution of the agreed schedules. The customer contact and problem resolution process are unnecessarily complicated, and the employees find it hard to resolve customer complaints.

For the past 12 months, there has been an alarming rate of laptop returns because these devices do not meet the standards specified by vendors, retailers, and distributors. Although there is a demand for the laptops, ZZZ Global Computers is late delivering its monthly commitments of 10,800 to 12,000 devices per month. In the same 12 months, the company has increased outsourcing some of the computer components. The number of units returned in the past eleven months is summarized below:

• June: 802 out of 11,333 shipped
• July: 733 out of 12,021 shipped
• August: 689 out of 11,110 shipped
• September: 1045 out of 9,886 shipped
• October: 458 out of 11,301 shipped
• November: 693 out of 12,301 shipped
• December: 798 out of 12,564 shipped
• January: 699 out of 13,411 shipped
• February: 587 out of 10,351 shipped
• March: 901 out of 9,554 shipped
• April: 803 out of 10,335 shipped

Categories of the Issues

The workforce and management could be the most significant contributors to the company's failure to provide quality products. The substantial increase in the rate of employee turnover is an indication that the workers are demotivated. Shortage of workers, unqualified personnel, and taking shortcuts during production are potential causes of low-quality products in ZZZ Global Computers. The management fails to understand customer needs; this has mostly contributed to the increased number of returned laptops and loss of critical customers. Flawed progress indicators, short term planning, lack of supervision, negative attitude towards change, and lack of process understanding are managerial failures that have facilitated production of inferior computers.

The quality of material used, technology, and methods used in production, and environment are other possible causes of the high rate of returned units. The use of low-grade computer components and outdated technology directly translates to poor quality. Lack of procedures, not following them, and too relaxed requirements and unfriendly working environment could have led to increased number of laptops returned.

Recommendations

To improve the quality of ZZZ Global Computers products, the company should first improve its operations and human resource management. Forecasting, resource utilization, and quality management are instrumental driving forces of any organization's profitability (Wright & Mechling, 2002). The company should embrace worker empowerment strategies to improve employee output. ZZZ Global Computers should use evidence-based decision making, carry out market research to identify customer needs, and avoid overselling its products to increase customer satisfaction. Also, the company should hire new employees and improve its logistics to improve timely delivery of its products.

Control charts, like the one shown above, are essential quality tools for tracking variations. Since every process is bound to have some variations, control charts can be used to identify quality problems, trends that might compromise profitability, and the predictability of outcomes. In the case of ZZZ Global Computers, control charts can be used as timeliness and quality indicators.

Manufacturing Delays

ZZZ Global Computers face manufacturing delays caused by lack of the required components. Economic order quantities are not used, and periodic cycle counts have not been conducted in the previous five years. Purchasing does not utilize economies of scale when ordering computer components. Also, the supply chain is not responsive to the needs of the company, retailers, wholesalers, and individual customers. Moreover, the company has received delayed delivery complaints from customers in Asia and Africa. ZZZ Global Computers should open manufacturing outlets in South Africa and China since the two countries have high industrialization rates (Central Intelligence Agency, 2019). Since there are several IT companies in the two nations, ZZZ Global Computers has better chance of getting quality components at market-friendly costs. Although the company might face competition, it will have better chances of restoring its profitability and timely delivery in Asia and Africa.

Geographical Information Systems (GIS) can be used in the analyzation of demographic, topographic, and environmental data in the proposed manufacturing sites in South Africa and China. The factor-rating method will be used to identify essential location factors and merits. The two countries have friendly cultures, political stability, and available local talent to provide labor. Moreover, the states have relatively stable currencies; therefore, there are minimal chances of making losses when making losses during currency conversion. Forecasting accuracy can be improved through demand sensing, tracking competitors' promotional efforts, forecasting environmental calamities, and tracking macroeconomic indicators. On the other hand, expediting costs on components can be reduced by changing modes of transportation, automating logistics, finding a transportation logistics and supplier, and using warehousing services (Pival Interntional, 2018).

Conclusion

ZZZ Global computers need new strategies to increase the quality and durability of its products, operations management, employee management, and customer care services. Recently, the company has been facing various challenges with its employees and customers, and several items have been returned due to poor quality. The leading causes of quality issues are poor operations and workforce management. ZZZ can solve delayed delivery issues in Asia and Africa by establishing manufacturing sites in the two regions.

References

Central Intelligence Agency. (2019, September 25). The World Factbook. Retrieved from https://cia.gov/library/publication/the-world-factbook/geos/pp.html

PIVAL International. (2018). How to Reduce Your Transportation Logistics Costs. Retrieved from https://pival.com/news/how-to-reduce-your-transportation-logistics-costs/

Wright, C. M., & Mechling, G. (2002).The importance of operations management problems in service organizations. Omega, 30(2), 77-87. https://doi.org/10.1016/S0305-0483(01)00058-5