Supply Chain Management Assignment-2 on

Chad’s Creative Concepts (Case)

Prepared By:
Kanakaiah.edla (0911A05)
PGDM (2009-2011)
Synergy School of Business Hyderabad
1) As per the case, Thomas has to focus on following issues….

A. Communication gap between Marketing Dept. and Production Dept.

B. Fail in Supply Chain Management

C. Failure in Operations Management

D. Stringent price offer

E. other raw material and other cost expensive

A) Communication gap between marketing department and production dept.:

Marketing team should have to communicate with all the departments in the company
because they know proper idea about sales of the standard furniture and custom
furniture. Else, Production Dept. has to interact with the Marketing dept. for further
production of the furniture because of marketing team know well about customer
behavior and survey reports about the product. So, we can not blame either marketing
or production departments for the issue. Chad needs to rectify this issue.

B) Stringing price offer: - As per this case study marketing deportment given a
minimum price level, when operation product output will comes out the cost of wood
expensive is very high, but cost product is minimum so there is no price management
in company

c) Other raw material cost:- At the same time in production, expensecive are only
wood cost, what about on other cost expensive

eg:- electricity, human resources cost, any interests on other banks,

even try to reduce the other cost is one problem apart of my said.

D) Fail in supply chain management:

Second issue, as per the given case, he need to extend the plant but there is no space
is being left in the plant for expansion. The text had mentioned that standard product’s
warehouse is costly to keep the inventory for long as space assuming. To solve this
problem, Chad needs to make inventory and supply-chain decision. He must decide to
take a good supply-chain Retail outlet with large spacious in order to maintain his
warehouse operations and implement it before it’s too late

E) Operations Management: Chad got problems due to lack of time management. As

per the given case, the operations manager has to follow ‘Hungarian Method’ to allocate
the resources in correct places to get optimistic results..

2)Initially they are manufacturing& custom furniture. It made good profits along with
good will for Chad.
. As the company’s reputation grew and sales increased the sales force began selling
some of the popular pieces to retail outlets. Het thought was emerged with retail
outlates, conceptually it was good, so organization marketing team work and
responsibilities on work will be improve at the same level point of time, production was
very high due to the lack of time some times they were not reached the target, and
ware housing cost would be increased at the point of time ,so marketing team done
good work at all time but organization management think about only profit way only due
to the lack of time management they were faced lot of problems in delivering the
products on time any way in this organization marketing team as a played important
role increasing the sales.

3) It shows clearly that the customers for standard furniture was price sensitive and
imposed more stringent delivery requirements. Here, Chad’s investment was lower
initially whenever he started manufacturing the standard furniture. After starting lower
sales of standard furniture, costs associated with the standards line are rising. Dollars
are being tied up in inventory, both of raw materials and work in progress. Expensive
public warehouse space has to be rented to accommodate the inventory volume.

Standard furniture production fulfilling the requirements of the demand and gaining
profits. But the profits of standard furniture compared to custom furniture is less. In
addition to that the inventory cost of custom furniture is also eating the profits of
Standard furniture. Finally no profit is displaying the balance sheet Standard furniture
production fulfilling the requirements of the demand and gaining profits. But the profits
of standard furniture compared to custom furniture is less. In addition to that the
inventory cost of custom furniture is also eating the profits of Standard furniture. Finally
no profit is displaying the balance sheet

Standard furniture production fulfilling the requirements of the demand and gaining
profits. But the profits of standard furniture compared to custom furniture is less. In
addition to that the inventory cost of custom furniture is also eating the profits of
Standard furniture. Finally no profit is displaying the balance sheet

Standard furniture production fulfilling the requirements of the demand and gaining
profits. But the profits of standard furniture compared to custom furniture is less. In
addition to that the inventory cost of custom furniture is also eating the profits of
Standard furniture. Finally no profit is displaying the balance sheet

4) But chad’s point of view, management playing not a sufficient role for this
organization so as a result company is not a performing well in some ways such as in
term of finance and slow manufacturing process. In the finance point of view this
company does not have proper sales, because all finance are block in term of inventory
in the warehouse .

In manufacturing process point of view ,finance condition are very poor and the raw
material going to be shortage day by day as a result manufacturing become a slow ,not
to meet the sales in the market . To solve the finance and manufacturing problem

I recommend the management the following:

 Production capacity to be increased as per the requirement by adding more

number of machinery without any compromise on quality.
 Inventory cost to be reduced by procuring raw material through proper planning
like daily consumption of raw material, Vendor, mode of transport for carrying the
raw material etc
 Continuous monitoring on Innovative Operations, Sales and financial activities of
the
business.
Motivating the marketing team in time management
Improving the research on product development
Create a new product innovation with out wood.
To create a good awareness what is organization objective in employees, so try
to give Training and develop program and sales force knowledge also

Thank you sir