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Strama Final Edited 180901 For Printing
Strama Final Edited 180901 For Printing
I. Executive Summary
plastic moulding and cabtyre wire manufacturing company not only in the
Philippines but also globally. BIG aims to be number one in terms of Quality,
Cost and Delivery by manufacturing high quality mould and engineering plastic
parts. BIG seeks to earn their customer’s trust and satisfaction by expanding
The critical success factors for the plastic manufacturing industry were
also discussed in this paper wherein the factors which have been given higher
position and distribution channels. In general, BIG ranks second among its
financial position. However, BIG needs to empower its production capacity and
Finally, this paper concludes that the best strategy for BIG PHILIPPINES
that could be offered to the market. Market penetration strategy and specific
action plans of management, will provide support in achieving the strategic and
continuous growth which is a good indicator that the country progresses and
Industries” (2016), comprises more than half of the Philippines's industrial sector
and accounts for almost a quarter of the country's Gross Domestic Product
(GDP). From an annual growth rate of 5.4% in 2012, the manufacturing sector
added, has been steadily increasing since the 1990s. From 1991 until 2000, the
sector grew on the average by 2.5%. Average growth picked up to 4.1% from
2001 to 2010. This further increased to 7.1% in recent years (2011 to 2014),
Strategic Management Paper for BIG PHILIPPINES CORPORATION 3
which is higher than the average growth rates of GDP and the entire industry
positive average value added growth rates in the 1990s, the 2000s and the early
2010s. In the 1990s and 2000s, the capital goods segment had seen the most
rapid average value added growth rate, driven primarily by the double-digit
growth rates of the electrical machinery products during the 90s and of the basic
metal industries in the 2000s. Meanwhile, from 2011 to 2014, the intermediate
goods segment has shown the strongest average value added growth rate
driven by the double digit growth rates of the print and publishing sector and the
chemical industry.
adaptive downstream industry that is able to fully supply the growing and
perception. Its goals are to satisfy the domestic demand and be a leading
contributor to the Philippine export basket and promote a high level of workforce
develop/ strengthen the plastics recycling industry and create a wide range of
consumer finished products. Main production processes include film and sheet
Strategic Management Paper for BIG PHILIPPINES CORPORATION 4
injection blow moulding; injection stretch blow moulding; pipe and profile
extrusion; net and twine extrusion; woven sack extrusion and weaving; sheet
automotive are aligned with the viability of the plastics industry. Having a local
source of plastic materials benefits all sectors with its adaptive, just in-time
delivery capabilities, and more importantly softens the impact brought about by
and high quality rubber products. It seeks to achieve this by (1) upgrade
manufacturing skills, (2) adopting technical and market standards, and (3) linking
manufacturing industry, with its strategic location and access to rich labor
resources. This helps the company in making sound management and strategic
decisions that could enable the success of its attaining of its goals and
objectives.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 5
Company Profile
Delivery by manufacturing high quality mould and engineering plastic parts. The
company aims to satisfy our customers by providing them with products that
meet or exceed their requirement at the most competitive cost delivered on time.
keeping our workforce skilled with the technical know-how of our process and
requirements; and growth of the company and employees towards our goals and
commitments.’
applicable legal requirements and other requirements from which our company
pollution and effective solid waste management; and set environmental goals
improvement.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 6
Corporate History
BIG PHILIPPINES CORPORATION was established on July 7, 1997
under the PEZA Registration and it has started its operations in April, 1998. In
(EMS) Certification in 2002 due to its quality and standardized processes and
products.
In December 2016, Japanese company, Yamato Industry acquired stock
of BIG, making it part of the Yamato Industry group of companies. Since then the
expectations.
Mission Statement
“Big Philippines corporation aims to provide the customers with high
between the customers and the company, and its employees, its supplier,
1. Develop and strengthen employees’ skills and knowledge with the aim of
demand;
2. Set and maintain policies on the cost reduction and efficient delivery of
services;
responsive for contributing his/her best capabilities and efforts. The company
strives to attain its full potential and help nurture the growth of the company,
the community.
Company Goals
Financial Goals
1. Obtain financing to expand manufacturing capabilities, increase
Nonfinancial goals
1. High Standard (1) Quality Product Zero (0) on Customer Claim
2. Out-going Lot Acceptance Rate 99.99%
3. In-process Inspection Rejection Rate > 0.1%
4. On-time Delivery : 100%
5. Customer satisfaction thru Q C D : Rank A
6. Employees of Big Philippines Corporation are knowledgeable in
efficient production methods and unique control system in which each of our
The company has the exclusive right to direct the operations and working
force of its business in all aspects. The exclusive rights and prerogatives of the
managed by the company in not only its result but also a way and means.
assigned.
2. To set the hours of work, shifts and work schedules.
3. To plan, schedule, direct or control factory operations and
schedules of production.
4. To introduce and install new or improved production methods or
facilities.
5. To designate the work and the employees to perform it.
6. To select and hire new employees.
7. To train and improve their skills and ability.
8. To promote, commend, demote, discipline, and suspend, discharge
Board of Directors
Human Resources
within the organization. HRD had a number of responsibilities that come with this
title. The Department is responsible for hiring members of staff; this will involve
attracting employees, keeping them in their positions and ensuring that they
and sets day to day goals for the organization. It is responsible for organization
of people in the entire Company and plans for future ventures and objectives
best in their employees and thus contribute to the success of the Company.
Recruitment of Employees
because this function ensures that the Company under consideration selects the
most skillful and competent person from a sea of applicants at that time. This
relation to what the Company needs. This role falls under the Staffing role of
employees. This can be done through rewards especially for those who have
and those who have exceeded expectations should be compensated for their
actions. Research has shown that rewarding employees for good performance is
staff members. This function of the department ensures that people in the
Organizations that have a clear direction are always more effective; those
members of staff will be more result oriented rather than just working for the
sake of it. The Department is also responsible for setting day to day objectives
necessary for streamlining activities within the organization and thus ensuring
ensuring that it plans adequately for all the organization’s future engagements
that will involve people. One important aspect of this is planning for employees in
the organization. It is important that the organization ensures that all the
employees under its wing are just enough to increase value to the organization.
Employment Policy
Employment Principles
BIG PHILIPPINES CORPORATION believes that its greatest and most
3. All employees are expected to maximize the use of their time and
A. Educational Attainment
B. Work Experiences
C. Expertise
D. Aptitude Test
E. Applicant’s background
F. Health check
Employment Status
o Regular Employee
Strategic Management Paper for BIG PHILIPPINES CORPORATION 16
probationary employment period (at least six (6) months) and has met the
o Probationary Employee
An employee who is hired after complying with the pre-employment
period of not more than six (6) months’ to determine his/her capability to meet
o Temporary Employee
o Apprentice
apprenticeship program. The Company may in its sole discretion hire for
o Contractual Employee
Strategic Management Paper for BIG PHILIPPINES CORPORATION 17
employee.
Occupational Status
o Manager
Refers to a person who has the power to lay down managerial actions
discipline, suspend, discharge or lay-off employees for just and proper cause,
and to transfer employees from one job to another or from one shift to
o Supervisor
judgment.
o Team Leader
knowledge and/or capability to handle his/her routinely jobs under the direct
knowledge or capability to handle his/her daily routine jobs under the direct
produce goods, supply parts or materials to the line department and ship
1. Regular working hours shall be eight (8) hours a day or a total of forty-
2. Regular working days are from Monday to Saturday except those days
as company holidays.
4. For purpose of meal & coffee breaks, the company adopts the following
schedule:
Working hours per day shall be eight (8) hours exclusive of a one (1)
hour meal break (no pay). Eight (8) hours include 10min + 10min
coffee break.
Working hours per day shall be eight (8) hours inclusive of Thirty (30)
minutes break.
Workweek)
5. Work Schedule
Compensation Policy
o Payment of Salaries
Employees shall receive their salary based on a daily wage rate (No
Work, No Pay).
Strategic Management Paper for BIG PHILIPPINES CORPORATION 21
1. Competitive wage or salary rates and benefits for similar work in our
hiring area;
2. The skills required and physical and mental challenge of each job;
holiday, the payday will be advanced to the last working day preceding the
10th or the 25th. The payment shall be paid directly to the employees or their
including legal deductions that may be made on their salaries such as absences,
basis.
Holiday
rest day/ holiday/special holiday, the management will put the information on the
1. Rest Day
Sunday, or any other designated rest day, shall be paid on top of his/her
2. Holiday
his/her regular daily wage. If the holiday coincides with the employees
3. Special Holiday
regular daily wage and at least fifty percent (50%) over and above the
basic pay or a total of one hundred fifty percent (150%) if the worker is
permitted or suffered to work on that day which falls his scheduled Rest
day.
by the parties.
o Overtime
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Basically, employees must strive to finish daily jobs that they are
responsible for within eight (8) hours. In case of rapid increases of production
The definition of overtime by the law is, any service rendered to the
employee by his/her employer beyond the first eight (8) hours of any particular
day. Overtime shall be paid in accordance with the provision of the Labor Code.
cases, in which case submission should be made within twenty-four (24) hours
after the overtime work starts. All approved overtime must be forwarded to the
control, overtime services can only be allowed after his/her immediate supervisor
or manager’s approval. Employees will not be paid for overtime works rendered
The Company shall pay a night differential of ten percent (10%) of the
basic wage rate for each hour worked between 10:00 p.m. and 6:00 a.m.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 25
Employees who receive a monthly salary may not be entitled for any
Employee Benefits
The Company shall provide better work environment and better benefits,
improve themselves every day. The management believes that every one of
Incentive Leaves
1. A regular employee with at least one (1) year of service in which the
company employs ten (10) or more employees shall be entitled to five (5)
days service incentive leave every year. Unused leave credits shall be
converted into cash at current basic wage, and paid on December 10th of
the year.
needs of its operations. The use of incentive leaves credit during plant
least one (1) day before the first day of leave. All incentive leave
date.
1. For regular hours work during ordinary working days, and the Company
Holidays’ worked.
twenty pesos (P20.00) for having rendered work of at least four (4) hours
during ordinary working days, and the company holidays worked. This
suspended from their work are not entitled to the said benefit.
2. For workers of working from 22:00 – 6:00 shall be entitled to a free basic
hour period.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 27
The meal allowance shall be given during the payroll period. The amount
Uniform Benefit
wear the company uniform in accordance with the company rules during work
together as one (1) team and to protect employees from injuries related to work.
1. Provision of uniform
a) All employees shall be lend with three (3) sets of uniform (polo shirt
etc), free of charge. One (1) pair of safety boots shall also be lent if
b) Every year thereafter, one (1) piece or set shall be returned to the
c) Every year thereafter, one (1) pair of safety boots shall be returned to
d) In case of stained or damaged uniform within a year, one (1) set or (1)
with a new one, free of charge with the approval of the immediate
supervisor.
is provided.
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b) If the old uniform/safety boots are not returned, the employee shall be
expense.
5. Uniform Design
year.
Bereavement Assistance
death was work related the company will give Fifty Thousand Pesos
(Php 50,000.00).
parent(s)
b) A regular Employee who wishes to apply for this benefit must submit a
Administrative Department.
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1. All regular employees with at least one (1) year of service after becoming
of three (3) days per year in case of death of the employee’s parent(s),
3. Within seven (7) days from the end of the leave, the Employee must
has been made, the amount paid to the employee during the absence
convertible to cash.
Wedding Benefit
2. To receive the wedding benefit the regular Employee must submit a copy
Maternity Leave
case of caesarian.
given the required notification to the SSS thru her employer; and her
contingency.
3. Maternity benefits, like other benefits granted by the SSS, are granted to
computing the employee’s 13th month pay for the calendar year.
1. All married male employees shall be entitled to seven (7) days’ paid
Paternity Leave (PL) per year in case of delivery of the male married
to cash.
supervisor or manager prior to the start of the leave. He must inform the
possible.
5. The PL may be availed of within the 60th calendar day from the day of the
delivery.
6. For the first availment, the employee must submit a copy of his marriage
certificate and the child’s birth certificate within seven (7) days from the
end of the leave. For subsequent deliveries, only the child’s birth
certificate must be submitted within seven (7) days from the end of the
leave.
of the leave. If payment has been made, the amount paid to the
more than seven (7) working days every year shall be granted to any solo parent
employee who has rendered service of at least one (1) year. The seven-day
2. “Solo Parent”- any individual who falls under any of the following
categories:
even without a final conviction of the offender: Provided, that the mother
death of spouse;
c) Parent left solo or alone with the responsibility of parenthood while the
medical practitioner;
legal separation or de facto separation from spouse for at least one (1)
children;
children;
welfare institution;
Strategic Management Paper for BIG PHILIPPINES CORPORATION 34
i) Any other person who solely provides parental care and support to a
j) Any family member who assumes the responsibility of head of the family
Retirement Benefits
irrespective of the method by which their wages are paid are entitled to
retirement benefits provided under Republic Act No. 7641 upon compulsory
retirement at the age of sixty five (65) or upon optional retirement at sixty (60) or
to fifteen (15) days salary plus 5 days service incentive leave and 1/12 of 13 th
month pay for every year of service, a fraction of at least six (6) months being
General Manager 1 4
Production Manager 3
Administration 3
Accounting 3
Purchasing/Marketing 2
Human Resources 1 11
Production Planner 1
Production Leader
Driver 1
Regular Worker 2
Polymatic Line 3 7 16
Cable Wire 4
Contractual Worker
Driver 2
Warehouseman 3 37
Polymatic Line 1
Cable Wire 19 12
Total Employees: 39 29 68
Strategic Management Paper for BIG PHILIPPINES CORPORATION 36
4.2 Marketing
the company in attaining its goals in line with the company’s vision, mission and
its objectives. The department also helps the company to meet its target sales
by maintaining its existing clients and finding new business that will help to
increase the company’s production and in effect, it will increase its revenue as
well. Marketing and sales are considered as one team under the Sales and
Marketing Department.
department also adds a BIG help in building a good relationship with its
customers. The marketing sales teams ensure that they were able to deal and
deliver their products based on their customers’ needs not only from closing the
sales but most especially having a good service after sales, so that they will be
able to maintain their existing customers and finding new ventures with their new
business.
A. Marketing Head
well suited to doctoral graduates with leadership ability and many holders of
R&D managers are found across all sectors of industry where research
and innovation takes place and often have a crucial role in the development of
new products and business. Many R&D managers take a back seat in active
to commercialization.
Perform duties for the marketing director and even sometimes take over
many duties and responsibilities with clerical work. Under which perform the
Target Market
The target market for BIG products is active consumers between the BIG
experts at the molding products they engage in, but they expose themselves the
and successful companies; they are BIG and small company. Despite their
they fall at the upper or lower end of the target range), they lead active at this
PMP and VCW. They like to be associated with high-quality products but are not
willing to pay a premium price for a certain brand. Current BIG customers tend
to live in Japan and Philippines. However, one future goal is to target consumers
globally as well.
Products Offered
including Plastic Injection, Assembly and Printing, and Mold Fabrication. The
and support services related to production and service provision. Their initial
facilities and equipment methods. The company believes that their employees
extrusion molding and earn their customers trust. They do research and
material field.
openings against the passage of heat, cold, dust, draughts, noise, air,
Promotions
available via the Internet, direct mailings, and in person. The firms’ promotional
efforts also seek to differentiate its products from those of its competitors.
convey the BIG message, demonstrate the products’ unique qualities, and build
relationships. BIG sales representatives visit each store two or three times a
year and offer in-store training on the features of the products for new retailers or
for those who want a refresher. As distribution expands, BIG will adjust o meet
greater demand by increasing sales staff to make sure it stores are visited more
frequently.
Sales promotions and public relations currently make up the bulk of BIG
promotional strategy. BIG staff works with retailers to offer short-term sales
currently working with several trip marketers to offer BIG items on a promotional
basis. Because BIG also engages in cause marketing through its contribution to
organization, the firm can easily implement ideas such as distributing free water,
skiers, and discount coupons at events. During the next year, the company plans
Create a BIG Tour, in which several employees take turns driving around
their BIG truck to distribute free water, stickers, and discount coupons for
BIG products.
Organize BIG hikes departing from participating retailers.
Hold a BIG design contest, selecting a winning slogan and logo to be
Distribution
scattered within Japan and Philippines. So far, BIG has not been distributed
through national market chains. BIG obtains much of its information about
Over the next three years, BIG seeks to expand distribution to retail
specialty shops throughout the nation, focusing next on the Philippines local
market and regions. The firm has not yet determined whether it would be
product line via Internet only, thus distinguishing between Internet offerings and
some of the more profitable store outlets so consumers could order customized
products from the stores. Regardless of its expansion plans, BIG fully intends to
Pricing
BIG products are priced with the competition in mind. The firm is not
concerned with setting high prices to signal luxury or prestige, nor is it attempting
to achieve the goals of offsetting low prices by selling high quantities of products.
new PMP to replace the old. The pricing strategy also makes BIG products good
Place
and plant is located in one of Silang, Cavite economic zones, enabling it to have
a strategic location with access to its suppliers, clients, and work force.
The Plastic Moulded Products and Vinyl Cabtyre Wire retail sales industry
sells about 5 billion worth of goods annually, ranging from high technology of
extrusion molding. The PMP and VCW market has many entries. Competitors
such as Philflex, Phelps Dodge, and Farma Rubber Industries, which offers the
same products, also grab some of the market. The outlook for the industry in
near their company and stores. Second, consumers are looking for ways to
enjoy their leisure time with friends and family without overspending. Third,
consumers are gaining more confidence in the economy and are willing and able
to spend more.
none offers the kind of trendy, yet practical products provided by BIG—and none
carries the customized logos and slogans that BIG plans to offer in the near
extrusion molding. Finally, BIG products are offered at moderate prices, making
products from one season to the next, picking up the newest product line,
Philflex owns 57% of the total market share in plastic moulded products
and vinyl cabtyre wires. BIG comes second with 25% market share. Farma
Rubber Industries and Phelpsdodge have the minor market shares with 10% and
8% respectively.
4.3 Financials
increased its Net Sales and Cost of Sales. In addition, the company’s Net
of Sales, and P4,056,980 in Net Income from year 2015 to 2016. An increase of
7% in Net Sales, 6% in Cost of Sales, and 24% in Net Income is observed. For
year 2016 to 2017, the company also experienced an increase in its Net Sales
Comprehensive Income.
The eminent increase in the company’s net income is a good sign that is
on the right track – financial-wise. This indicates that there is a good opportunity
for the company to use its incurred income to venture into new strategies that
could help it improve its situation in its industry and in consequence, its
profitability.
The company could also use their financial data in planning the next step
in maximizing its funds. It could decide to make further investments that could
help improve its product offerings, or to emphasize its current market position
through market penetration, or any other strategic decisions that could entail
Net Sales (Php25,538,173). Cost of Sales (Php 23,014,475) and Net Income
(Php1,063,452).
Table 5: BIG’s Net Sales, Cost of Sales, and Net Income Increase
Strategic Management Paper for BIG PHILIPPINES CORPORATION 49
divided by sales. The company has obtained an increasing stability in its profit
margin from 2015 to 2017. This indicates that its income for every peso
increased by P0.04.
proportion of money left over from revenues after accounting for the cost of
BIG’s gross profit margin indicates earnings after product cost has been
deducted. There is an increasing trend in the gross profit margin from 2015 to
2017. This may be due to decrease in cost of increase in price of the product.
in a controlled manner as per the policies of the Company. This is that part of the
Concept of Production
enhance the utility of the product to the user.” Thus production is a value addition
Production System
management.
objective.
customers within prefixed time and cost. The distinguishing feature of this is
low volume and high variety of products. A job shop comprises of general
because of uniqueness.
Advantages
can be produced.
2. Operators will become more skilled and competent, as each job gives
Limitations
2. Higher level of inventory at all levels and hence higher inventory cost.
2. Batch Production
job passes through the functional departments in lots or batches and each lot
Characteristics
3. When plant and machinery set up is used for the production of item in a
batch and change of set up is required for processing the next batch.
4. When manufacturing lead time and cost are lower as compared to job
order production.
Advantages
Limitations
production.
3. Mass Production
product layout. Product and process standardization exists and all outputs
Characteristics
back tracking.
Advantages
Limitations
2. Line layout needs major change with the changes in the product
design.
4. Continuous Production
operations from the first operations to the finished product. The items are
Characteristics
Advantages
automatic.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 58
Limitations
exist.
organization into value added product in a controlled manner as per the policies
of the organization.
services of right quality and quantity at the right time and right manufacturing
cost.
products in right number. If they are produced in excess of demand the capital
will block up in the form of inventory and if the quantity is produced in short of
of which is to satisfy customer wants i.e., to provide some utility for the customer.
Concept of Operations
cascade down to maximizing output with least costs. Cost reduction requires
minimizing unit costs basing its productive activities at most favorable low cost
production.
for the operations subsystem of the organization, and the policies, and
procedures for achieving the objectives or the demands of its clients. This
stage includes clarifying the role and focus of operations in the organization’s
overall strategy. It also involves product planning, facility designing and using
achieve the goals and assign authority and responsibility for carrying them out.
with planned performance. To ensure that the plans for the operations
functions here.
Behavior
and control affect human behavior. They also want to know how the behavior of
Models
process, they encounter many problems and must make many decisions. They
can simplify their difficulties using models like aggregate planning models for
examining how best to use existing capacity in short-term, break even analysis
to identify break even volumes, linear programming and computer simulation for
facilities etc.
a. Customer Service
specification which can satisfy the customer in terms of cost and timing. Thus,
primary objective can be satisfied by providing the ‘right thing at a right price at
described for four functions. They are the principal sources of customer
for ‘conversion by using physical resources. Following are the activities which
1. Location of facilities
3. Product design
4. Process design
6. Quality control
c. Location of Facilities
where our main operations should be based. The selection of location is a key-
based on the company’s expansion plan and policy, diversification plan for the
products, changing sources of raw materials and many other factors. The
purpose of the location study is to find the optimal location that will results in
d. Product Design
BIG’s product design deals with conversion of ideas into reality. Every
survival and growth strategy. In the case of BIG, developing new products and
organizations.
e. Process Design
process route for converting the raw material into finished goods. These
flow analysis and layout of the facilities. Hence, the important decisions in
process design are to analyze the workflow for converting raw material into
finished product and to select the workstation for each included in the workflow.
receiving inspection to ensure that all the materials delivered are quality and
undamaged. If the raw materials received are rejected, they are to be returned
If the raw materials received are approved, they are forwarded to the
products will then undergo to quality control process before shipping to its
buyers.
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g. Production Facilities
Strategic Management Paper for BIG PHILIPPINES CORPORATION 66
h. Plant Layout
Strategic Management Paper for BIG PHILIPPINES CORPORATION 68
arrangement that meets the required output quality and quantity most
economically.
i. Storage of Materials
process which is under the quality and control assurance. It is where the
specifications and designing the various features into the products to these
essential in making sure that the operations and production of the factory is in
programs as of now. We propose that the company should have free trainings
These trainings and seminars may be about livelihood and skills training that
could aid their beneficiaries with needed competencies that could be used in
getting a stable job and thus would enable them to have a better future.
This program will also be beneficial for BIG as it may become a threshold
for the company in finding good potential employees that could become assets
for the company. Upon giving trainings to out-of-school-youths within the locality
Weaknesses:
provides a basis for identifying and evaluating relationships among those areas.
The matrix below illustrates the company’s internal factor evaluation. BIG
has a strong market position; meaning, its products enjoy a big portion of the
market share. Also, because of it having one source of its products, it has the
ability to control the quality in production. In addition, BIG is already a stable and
established institution for decades and its founders understand the target market
and product line, thus, enabling them to maximize the company’s potential in
profit maximization through its distribution channels. The company also has
Despite all these strengths, BIG is also weak in some aspects, which may
hinder it in attaining its goals. One of these weaknesses is the limited production
capacity it has because it only has one production supply. Also, the company
incurs high operating costs despite having limited number of workers. BIG also
number of consumers around the country who are aware of the company’s
products.
Strengths:
Weaknesses:
be considered along with the awareness of one’s competitors and their status
within the industry. The Competitive Profile Matrix is thus used. It is a tool that
compares the firm and its rivals and reveals their relative strengths and
weaknesses.
product being offered to the market. This factor is given a weight of 0.27. The
Strategic Management Paper for BIG PHILIPPINES CORPORATION 73
uniqueness and quality of one’s product is important to get the loyalty and
0.21. Being in a very competitive industry, most companies offer products with
similar level of quality. However, if a competitor is able to give the customers with
similar quality products but in cheaper prices, they would likely get these
customers and leave the other companies in the dust. Hence, a good pricing
and its products known to its target market. In this way, the company may be
able to show what it can offer to the customers and encourage them to patronize
them. Through this, a company may be able to get a large chunk of the market
share.
These also impact how a company may move towards its goals.
Philflex generated the highest weight score of 3.03 and is the strongest
company among the industry. This is because most of its critical success factors
competitive pricing and thus generating a major part of the market share.
the third place in terms of industry competitiveness with total weighted score of
2.69 and Phelpsdodge ranked last with a total weighted score of 2.61.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 74
Critical Success Weight Rating Weighted Rating Weighted Rating Weighted Rating Weighted
Factors
Score Score Score Score
is within the heart of Silang, Cavite. Its location advantages are abundance of
labor and assurance of industrial peace, a very secure industrial subdivision and
highly trained and easily trainable labor force. This is a good advantage for the
company as having skilled workforce will help it to produce quality and high-
value products.
The article “Silang, Cavite” (2010) states that the first-class municipality of
Dasmariñas and General Mariano Alvarez (GMA) bound it on the south and on
the west by Amadeo. Silang is noted for its relatively cool and invigorating
Manila area. With adequate accessibility, the municipality of Silang is within the
c. Economic
BIG could be considered as one of the economic pillars in Silang, Cavite.
provides huge investments to the city and its locality. It has also been providing
stable employment to most of the residents within the city as the company offers
opportunity to earn income for their family and to be used in fulfilling their
respective needs and wants, thus, spreading income throughout the locality. In
addition, the company pays valuable taxes to the government that could aid in
generating sufficient funds that could in turn be used to the improvement of the
municipality.
In the article titled, “Silang, Cavite” (2010), the said municipality is one of
the fastest growing local government units in the province of Cavite. Numerous
are mostly concentrated in the town proper. Industrial establishments are located
the province.
Silang, like most of the towns in the province of Cavite, depends on a
mainly agricultural economy. The primary crops grown in the area are coconut,
coffee, corn, banana, pineapple, and tree crops like mango, lansones, caimito,
santol, jackfruit, guava, and avocado. Fertile soils and abundant water sources
make Silang suitable not only for common commercial crops but also for high
value and exotic crops production. Most of the local farmers practice
barangays. Manufacturing and trade, aside from agriculture are Silang’s other
major sources of income. Trade and investments grew tremendously with the
estimated at P2.5 billion between 1996 and 2004, which helped bring about the
soared, allowing investors to infiltrate and start business. The investment trend
resulted in the increase in the price of prime realty from P3,000 to P15,000 per
square meter and from P150 to P500 per square meter for raw lots in interior
BIG affects society because of its link to the workforce within the locality.
them the opportunity to fulfill their needs and wants and have a comfortable
lifestyle. There is also an opportunity for parents to send their kids to school and
attain their needed education, thus, contributing to the emergence of skilled and
competent, and easy to be trained. This may be due to the fact that Caviteños,
and generally speaking, Filipinos, are good workers that are asset to the
company they are working for. They also value their work, thus, they do their
Strategic Management Paper for BIG PHILIPPINES CORPORATION 77
best to give the best they can to produce the best products and services to their
clients.
The Technical Working Group (TWG) for the Chemicals Industry Cluster –
industry concerns are addressed. The TWG is organized into four action tasks,
namely:
promotions;
and
cycle assessment (LCA) and the use of the same as basis of scientific
and technological studies in crafting laws that would affect the industries.
chemical list (PCL)), the TWG was able to obtain a PCL exemption for
Industry was identified as one of the priority sectors. Following this, BOI
Trade, and Industry (METI) and the National Institute of Technology and
These programs are beneficial for BIG as it can use these for the
adheres to the Philippine Constitution which mandates how the company should
operate and how it can help emphasize the importance of workforce to the
company’s success. It also illustrates the importance private sector for the
economy as a whole.
Section 18, Article II of the 1987 Philippine Constitution states that, “the
State affirms labor as a primary social economic force. It shall protect the rights
of workers and promote their welfare.” This is true with BIG as it acknowledges
the importance of its workforce and employees for the success of the company.
Because of this, BIG creates a healthy and happy working environment for its
Section 20, Article II of the Philippine Constitution also declares that “The
State recognizes the indispensable role of the private sector, encourages private
to improve itself so that it can attract more investors that could help them in
innovating new products and technologies that could be offered to its market.
Through its successful operations, BIG could contribute to the private sector’s
f. Technological
customers trust. BIG products are currently carried international and by local
small retail stores that specialize in Plastic Molded Products Wire. The high
quality, extrusion molding, and unique message of the Plastic Molded Product
parts by injecting material into a mould. Injection moulding is one of the chief
processes for producing plastic items. It is a fast process that can deliver a large
small disposable consumer goods. The use of this process has enabled the
of conventional materials, thereby reducing the weight of the end product and
injection technique (GIT) and water injection technique (WIT). In the co-
injection method, two melts are injected into the machine’s cavity through
one gate, one after the other. In mono-sandwich method, two materials
are injected with one injection unit via one passage into the cavity. In GIT,
the gas used is mostly nitrogen, which is injected into the part to replace
the melt in the core and create a hollow space. GIT enables production of
lowers clamp force and machine costs. GIT enables less sink marks,
parts with less distortion, and improved part quality. In WIT, there are two
processes - the short-shot process and the full shot process. In the short
shot process, high speed shooting is required during the filling process in
than the GIT. WIT provides lesser cycle times, smaller and constant wall
thickness with less warpage, large part diameters, and smoother inner
local conservation programs. Ultimately, the company would like to develop and
fund its own environmental programs that would help conserve the surrounding
h. Competitors
products, also grab some of the market. The outlook for the industry in general—
and BIG in particular—is positive for several reasons. First, consumers are
company and stores. Second, consumers are looking for ways to enjoy their
leisure time with friends and family without overspending. Third, consumers are
gaining more confidence in the economy and are willing and able to spend more.
none offers the kind of trendy, yet practical products provided by BIG—and none
carries the customized logos and slogans that BIG plans to offer in the near
tech manufactured Plastic. BIG is made of strictly the highest quality of extrusion
molding. Finally, BIG products are offered at moderate prices, making them
affordable in multiple quantities. For instance, a BIG PS Spacer sells for $15.99,
$29.99. Consumers can easily replace a set of products from one season to the
Strategic Management Paper for BIG PHILIPPINES CORPORATION 83
next, picking up the newest product line, without having to think about the
purchase.
consumers prefer to replace their PMP more often than other molding products,
the trend toward health-conscious activities and concerns about the natural
position to grow. However, as BIG considers expansion of its product line and
entrance into new markets, the firm will have to guard against marketing myopia
(the failure to recognize the scope of its business) and quality slippages. As the
company finalizes plans for new products and expanded Internet sales, its
the products. BIG has a big existing client abroad, but with fewer distributors
locally. BIG are prepared with any competitors and any environment conditions
Strategic Management Paper for BIG PHILIPPINES CORPORATION 84
that may compete with their products because of their high quality and original
expenses the profit will be greatly affected that will lead to poor development for
the corporation. BIR has annual findings regarding their tax payments. Every
time they pay their taxes the BIR has findings that lead to discrepancy of the
The table below illustrates the external factor evaluation matrix used to
analyze the opportunities and threats that may affect the BIG PHILIPPINES
strategies and tactics to ensure the positioning of the company within its market
niche.
greatly influenced by its proximity to Metro Manila and the national government's
industrial boom. It becomes the choice location for business enterprises being in
Phelps Dodge, Farma Rubber and Philflex are considered to be the direct
products. Although BIG has differentiated products, the competition is still tough
because consumers can switch brands easily if there will be changes in the price
Considering the high costs of scale barrier, which is the large capital
requirement, the limited information of the technology and the tough competition
Strategic Management Paper for BIG PHILIPPINES CORPORATION 86
among industry players, there’s still a possibility for incoming competitors due to
the booming of the industry. The potential entry of new competitor model is high.
Threats of substitute
robust. BIG always see to it that they are advanced in terms of technology
because of the fear of having more substitutable products in the market. The
are few substitute for the raw materials. Same is true if there will be a switching
of raw materials.
Buyers always look for quality products but still are considered as price
conscious. This is due to the fact that there is high competition in the area.
Consumers have a wide range of choices which made them a bit of being the
price setter. This reason gives the bargaining power of buyers to be high.
Competitors such as
Philflex and Bargaining Power of
Phelpsdodge, which Buyers- High
offers the same products
BIG do not have BIG had a big
established brand existing client
reputation abroad with
less
distributors
locally
There are
many
substitute for
the same
products
Strategic Management Paper for BIG PHILIPPINES CORPORATION 87
V. Strategy Formulation
In using the Grand Strategy Matrix, BIG is located in the Quadrant I with
market share, the company continuously incurs an increase in its net sales and
net income. However, BIG is focused on selected products that it offers to the
market, namely the Plastic Moulding. It is thus recommended that to improve its
strategy, by innovating new product lines that they could offer to the market. The
company should also venture in strategies that could help it penetrate the market
options. By using it, you can look intelligently at how you can best take
advantage of the opportunities open for the company, at the same time
minimize the impact of weaknesses and protect the business against threats.
Many strategies could be ventured to help BIG achieve its goals and
objectives. One of the strategies that the company could execute is the
known within the market and have better position among the industry.
The company could also opt to produce a new line of products that it
could introduce to the market. In this way, BIG could have the advantage of
offering ingenious products that are not yet launched by other companies. This
could give the company a cutting edge in the industry. BIG should also provide
high value and flexible product that its competitors have not yet produced and
Thus, the company should also procure and use efficient and modern
equipments for production. This strategy is essential to ensure that the products
that the company produces are of quality and would have minimal problems and
hitches. Likewise, it is also important that the company should buy from local
suppliers to minimize cost from raw materials. This is strategic for the company
as it would be efficient to get raw materials within the locality of the company as
it would be easier to order supplies and return the reject ones to the supplier.
The transportation cost is also minimized and optimized using this method.
Strengths Weaknesses
Pricing Limited production capacity
TOWS
High Operating expenses
Good financial position
Limited number of
Ability to control quality consumers around the
in production country is aware of MPC
product
Strong market position
Limited number of workers
Distribution channel
Need for more advertising
Strategic Management Paper for BIG PHILIPPINES CORPORATION 90
BIG could maximize its strengths and take advantage of the opportunities
it has. Also, BIG could make amendments to deal with its weaknesses and
threats. The company’s internal-external matrix shows that BIG is within the
Quadrant V. Being in this quadrant means that the recommended strategies are
strategies. These strategies provide further opportunities for BIG to expand itself
new markets.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 91
Threats
Currency fluctuations 0.09
BIG has shown a continuous increase in its income over the financial
years of 2018 to 2020. The projected 3-year income statement of the company
Cost of Sales
507,469,185 532,842,645 559,484,777
Gross Profit
55,647,530 58,429,907 61,351,402
Other
Operating Expenses 33,862,855 35,555,998 37,333,798
Operating Profit
20,091,533 21,096,109 22,150,915
Other Income (cost)
13,407,181 14,077,540 14,781,417
Profit before tax
33,498,713 35,173,648 36,932,331
Income Tax Expense
9,571,061 10,049,614 10,552,095
Net Income
23,449,100 24,621,555 25,852,633
Current Ratio
financial health. The higher the current ratio, the more capable the company is of
paying its obligations as it has a larger proportion of asset value relative to the
value of liabilities. The current ratio can give a sense of the efficiency of a
company’s operating cycle or its ability to turn its product into cash. Companies
that have trouble getting paid on their receivables or have long inventory
turnover can run into liquidity problems because they are unable to alleviate their
obligations. BIG has a 3.4285 current ratio computed by dividing the current
assets by the current liabilities. Compared to the average ration of 2.0 for the
industry in general, we can infer that BIG is performing better in terms of liquidity.
Having an operating cash flow ratio of 1.17, it shows that BIG have more
cash flows from operations than current liabilities and with an estimated
difference of 100,000,000 in terms of pesos. This means that BIG have the
without affecting its liquidity or capability to pay its current liabilities from its
2017
Cash Flow from Operations 800,000,000
Current Liabilities 700,000,000
Current Ratio 1.17
Inventory Turnover
sales and therefore, excess inventory. A high ratio implies either strong sales
and/or large discounts. The inventory turnover ratio of 7.00 of BIG in 2017 is
unfavorable as compared to its 7.81 and 7.07 inventory turnover ratio in 2015
The asset turnover ratio of 4.47 of BIG means that every 1 peso sales is
the market deeper, sales will increase and as a result, the asset turnover will
also increase.
turnover ratio of BIG is 11.67. This ratio indicates that BIG is efficient in collecting
its receivables.
2017
Sales Php 536,301,631
Receivable Php 62,586,400
Receivable Turnover Ratio 11.67
Asset Turnover Ratio 4.47
Debt Ratio
Having a debt ratio of 0.36 that means 36% of the company’s total assets
are being finance by debts. This is below the industry average of .4692 which
means that BIG is more solvent and has financed its assets through equity better
than others.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 96
2017
Total Liabilities Php 864,000,000
Total Assets Php 2,400,000,000
Debt Ratio 0.36
This means that the total assets are being financed more through equity
Profit Margin
Computed by dividing the net income by the net sales, a profit of .042
means that 0.42% of its sales will go to its net income and the remaining
averages, we can infer that BIG is profitable by looking at the peso value.
2017
Net Income Php 22,332,476
Net Sales Php 536,301,634
Profit Margin 0.042
Strategic Management Paper for BIG PHILIPPINES CORPORATION 97
Return on Assets
capital (assets). The ROA figures give investors an idea of how effectively the
company is converting the money it has to invest into net income. A higher ratio
Return on Equity
The ROE shows the common shareholders how effectively the money
they invested is employed. The higher the ratio percentage, the more efficient
management is in utilizing its equity base and the better return it to investors.
BIG can increase its ROE of 0.028 since employing the strategy of product
development and market penetration can be absorbed by its capital. This means
that the marginal benefit will accrue to the shareholders because BIG will not
rely that much on invested capital in financing market penetration and product
development.
employ.
research and create a new set of product that it could be offered to the
The programs under this strategy include: (1) expanding the product lines
value pricing to make BIG products offering a good value against its competitors;
(3) procuring and using efficient and modern equipments for production; and (4)
Under these strategies, the following are the activities involved: (1) the
company should conduct research for the most in-demand product; (2) conduct
assessment for customer needs; (3) hire contractual personnel who gain
equipment and infrastructures; and (5) conduct seminars and different job
training method. These activities will be tasked to the Top Management, the
Management Department.
so that it could break through the market and generate greater market share.
Strategic Management Paper for BIG PHILIPPINES CORPORATION 100
The programs involved for this strategy are as follows: (1) entering new
geographic markets and distribution channel; (2) setting a low initial price in
order to penetrate the market quickly; (3) increasing brand awareness through
following activities: (1) use internet for market share growth to compete more
effectively; (2) practice online selling; (3) attract large numbers of buyers quickly
and win a larger market; and (4) price reduction for loyal customers. These
Objective:
To introduce two new product lines—Plastic Moulded Products and Vinyl Cabtyre
Wire.
Objective 2:
To enter to new geographic markets, including local markets and to expand online
sales by offering the customized product line via Internet only, thus distinguishing
between Internet offerings and specialty ship offerings.
2. Practice P100,000
2. Setting a low
Market initial price in order online selling.
to penetrate the
Penetration market quickly
Marketing
3. Attract large P2,000,000
3. Increase brand
numbers of Dept.
awareness
buyers quickly
through
and win a larger
advertising.
market
REFERENCES:
Strategic Management Paper for BIG PHILIPPINES CORPORATION 102
http://industry.gov.ph/category/manufacturing/
Securing the Future of Philippine Industries. (2016). Retrieved on August
http://industry.gov.ph/industry/plastics/
Silang, Cavite. (2010). Retrieved on August 25, 2018 from the World Wide
Web: http://www.wowcavite.com/towns-and-cities/silang-cavite-
population-historygeography-barangay-gov-officials/
Thomas, G. (2013). Recent Innovations in Injection Moldings. Azo
Materials. Retrieved on April 15. 2017 from the World Wide Web:
http://www.azom.com/article.aspx?ArticleID=8553