Chads Creative Concepts Case Study free essay sample

Chad’s Creative Concepts Case Study 1. What types of decisions must Chad Thomas make daily for his company’s operations to run effectively? Over the long run? Chad Thomas needs to make sure daily manufacturing schedules are aligned with the current orders. The fact that the same set of employees and the same set of tools are being used to manufacture both the custom and the standard pieces of furniture is definitely problematic. In order to meet the demands of each product, it is critical that scheduling be created in the most efficient of manners given the current constraints. Allocating all the resources properly is a key along with scheduling and layout. In regards to long term decisions, Mr. Thomas is going to have to decide if he is going to stay with the same facility, equipment, employees and so on. Without making more drastic changes such as seeking to separate the current company into two separate divisions consisting of custom furniture and standard furniture, Chad Thomas may want to ensure the factory layout is as efficient as possible. We will write a custom essay sample on Chads Creative Concepts Case Study or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Mr. Thomas needs to figure out what competitive priorities he wants to most address because currently he has two priorities with potentially two distinctly different answers. Having a highly customized product manufactured requires a more hands on involved approach which focuses less on quantity. The standard furniture is requiring less variety in the product but more volume output at a lower price. With the success of both of these lines of furniture, the company has turned a profit but has reached a point where growth is a significant issue because they are at capacity, lead times are increasing, and the cost of inventory is skyrocketing. . How did sales and marketing affect operations when they began to sell standard pieces of retail outlets? By promoting the standard furniture, sales and marketing attempted to and somewhat successfully introduced Chad’s Creative Concepts to a larger consumer base. It placed quality furniture items in retail outlets. This has been successful wh ich, in turn, required the company to schedule the same employees and the same equipment that produce the custom line to produce the increasing demand of the standard line. The custom line has taken priority, however, due to the higher dollar sales, and the standard lines products were often left temporarily incomplete till the custom orders were met. This is a significant problem because the consumers of the standard furniture expect lower lead times and lower prices. 3. How has the move to producing standard furniture affected the company’s financial structure? The profits have increased for the company with the custom line accounting for 60% of volume and 75% of dollar sales according to this case study. The standard line has seen a continued increase in sales as well. What comes with the increased profit due to the increased manufacturing is the need to put higher amounts of capital into storing the higher inventory. With the company being at capacity, the lead times may not be meeting consumer demands either. The expansion that is needed would initially cost Chad’s Creative Concepts greatly. Without some type of expansion (which would most likely require a new plant), soaring inventory costs will need to be attended to. . What might Chad Thomas have done differently to avoid some of the problems he now faces? Perhaps Mr. Thomas should have studied and evaluated what pursuing a standard line of furniture in addition to maintaining the custom line of furniture would have meant to all aspects of the company in the future. The production of a custom line and standard line would need to be handled differently due to the differing customer expectations. Realizing that these production lines may need to be separated or that the potential results in keeping them condensed should have brought about questioning of potential issues such as storing inventory and conflicting production scheduling. The plant is at capacity currently according to the case study. Mr. Thomas should have been better prepared to handle the increased production or at least toned down the drive to enter the standard furniture market until better accommodations could have existed.