Assessment Task 1
To demonstrate the skills and knowledge required to review, evaluate and analyse programs, systems and processes.
Based on the case study provided, you will write a report in which you outline a performance and sustainability review strategy, evaluate the strategy, analyse performance reports and trends, and describe how you would seek advice from specialists to identify technological solutions.
In your report, include if applicable:
Refer to quality management and continuous improvement theory.
Consider the strengths and weaknesses of the A. C. Gilbert Company prior to 1960. Discuss the following in your report:
Apply creativity skills to identify missed opportunities to improve business performance. Describe at least one missed opportunity in detail. Include an action plan for implementing the improvement in your report.
You must provide:
Your assessor will be looking for:
Alfred Carlton Gilbert was an inventor and a toy manufacturer who invented the Erector engineering set. His original company, The Mysto Manufacturing Company, was founded in 1909 to manufacture the Erector set. In 1916, Mysto became the A. C. Gilbert Company and gained a reputation for producing quality toys.
By the 1950s, A. C. Gilbert was one of the leading toymakers in the United States, with annual sales regularly topping $17 million. This was an outstanding achievement for a relatively small company.
In 1961, A. C. Gilbert, Senior, died, leaving the company in the hands of his son, A. C. Junior. At the time A. C. Junior took over the firm, the company was established as a traditional, reliable and profitable manufacturer of educational toys.
A. C. Gilbert was a small company. The following model demonstrates the systems and processes in place.
Note: These flow charts have been included for assessment purposes only, and may not accurately reflect the actual processes in place at A. C. Gilbert.
As the 1950s moved into the 1960s, there were huge cultural changes across the world. The fifties were a very traditional era of family values and morals, conservative and staid. Then came the ‘swinging sixties’. The sixties were a time of rapid change both technologically and culturally. Old-fashioned values gave way to new moral freedoms.
Where the fifties represented solidarity and familiarity, the sixties embraced change. Everything was bolder, brighter and more daring. A new young president and rising social activism by youth saw changes in clothing, music and interests. Young people rebelled against the values of their parents and embraced a more fast-paced, exciting and riskier lifestyle.
Cultural changes had a huge impact in western toy markets. Barbie and Action Man became ‘must have’ toys. Girls moved away from baby dolls and cots and wanted dolls that were more grown up, modern and trendy. They wanted dolls they could dress in the latest fashions and who had exciting ‘careers’, boyfriends and cars of their own. Boys were moving away from the traditional train sets and towards exciting new slot-car racing sets and action figures from popular movies and television shows.
Traditionally, toy advertising had been done via magazine promotions, but the sixties brought in a new phenomenon: television advertising. A hugely powerful medium, TV advertising became increasingly ‘hard sell’, with toys heavily promoted, especially in the lead up to Christmas. Children wanted the latest and greatest toys that they saw in these advertisements, and they put pressure on their parents to buy, which their parents did.
Retailing of toys during this period reflected a shift in retailing in general. Small, specialty retailers with experienced and knowledgeable staff were going out of business, replaced by large discount stores catering for the mass market. The goal of this type of retailer was to turn over stock. Heavily advertised lines were in demand, and that is what they would stock. Cheap was in, and giant retailers were after a quick profit from easily saleable, inexpensive products. They weren’t interested in catering to a niche market by stocking more expensive, harder to shift lines.
Packaging was bright and colourful in order to attract children growing up in a world of colour TV, hypercolour clothing and visual stimulation provided by the swinging sixties.
As a small, traditional company, A. C. Gilbert was slow to react to these changes. It may have been that they were not aware of the changes or were overly confident that their good name and reputation were sufficient to continue trading as before. The consequences of this short-sightedness soon became apparent.
L/Y Sales |
Actual sales |
Difference |
Profit |
$12.6 million |
$11.5 million |
($1.1 million) |
$20,011.00 |
This drop in sales was also reflected in a fall in the share price of the company.
As a result of the falling profits and share price, the company became attractive to an opportunistic businessman, Jack Wrather. Jack Wrather was an independent television producer who had made his money producing the popular programs ‘Lassie’ and ‘The Lone Ranger’. Jack Wrather wanted to purchase a successful business and felt that in
A. C. Gilbert, he had the opportunity to use his knowledge of popular entertainment and apply it to the production of toys. He purchased 52% of A. C. Gilbert for $4 million and immediately set about making his mark on the company. A. C. Junior stayed on as Chairman but his influence was minimal.
Year |
Sales |
Difference from previous year |
Profit/loss |
1961 |
$11.5 million |
($1.1 million) |
$20,011.00 |
1962 |
$10.9 million |
($600,000.00) |
($281,000.00) |
1963 |
$10.7 million |
($200.000.00) |
($5.7 million) |
1964 |
$11.4 million |
$700,000.00 |
($2.6 million) |
1965 |
$14.9 million |
$3.5 million |
($2.9 million) |
1966 |
$12.9 million |
($2 million) |
($12,872,000.00) |
1967 |
A. C. Gilbert closed (1909–1967) |
||
1962:
1963:
1964:
1965:
1966
1967
Note: This case study is a true story. You may wish to read more about this organisation or to conduct additional research online.
Reference material
Assessment task 2
To demonstrate the skills and knowledge required to develop options for continuous improvement.
Based on the case study provided, you will develop a performance improvement strategy, brief a team of peers on the strategy, develop the strategy and encourage innovation within the group session, and incorporate results of consultation into strategy. You will develop risk and cost-benefit analyses which you will submit to your assessor for approval.
Your manager, as per organisational processes for continuous improvement, has asked you to develop a performance improvement strategy, brief the management team, develop the idea with the team, seek the team’s approval and seek final approval from your manager.
You must provide a:
Your assessor will be looking for:
Assessment task 3
To demonstrate the skills and knowledge required to implement innovative processes.
Based on part 1 of the case study provided (see Appendix 1), you will develop an implementation plan to embed a new process. Based on part 2 of the case study (see Appendix 1), you will need to amend your plan to ensure success.
You must provide:
Your assessor will be looking for:
John Jones, a Production Manager at A. C. Gilbert, has developed an idea for improving efficiencies in the manufacturing process at A. C. Gilbert. The idea came as a result of the innovative ideas program, and John has successfully trialled the program on one line in the processing plant.
The program has been evaluated and found to be successful, and you are now in the process of implementing the program company-wide.
The goal of the program is to increase productivity, reduce waste, improve sustainability, and reduce errors on production lines by 20% by allocating specialist team members to individual lines.
A secondary goal is to reduce staff turnover from an average of 32% per annum to 20% per annum, thus improving the skill levels and efficiencies of the plant and reducing costs in recruiting and training new staff.
Production staff and process workers will be divided into five different teams. Each team will be responsible for the manufacturing of five product lines. Team members will only work on their specialty line, and rosters will be altered to ensure adequate staff on each line during the 12-hour production cycle. This may involve changes to staff rosters, in some cases by implementing 12-hour shifts, but will not impact on earnings or result in the loss of any hours of work.
John also suggested involving teams in goal setting and objective setting for their own product lines. Each month they meet to develop production and error rate projections for the next, with a goal to continuously improve both rates to achieve a maximum of 4% error rate and a 40% increase in productivity within 24 months. Current error rates are at 22%.
To incorporate this change, production lines will be closed for 48 hours for retooling. During this period, staff will be re-trained in the production of their designated lines by shift supervisors. Training required will include technical training, motivational training and quality control procedures along with goal and objective setting workshops.
It is projected that the costs incurred for the change will be:
Development costs |
|
Initial trial |
$150,000 |
Implementation costs |
|
Retooling the production line Training Loss of productivity |
$1.2 million $20,000 $50,000 |
|
Ongoing costs |
|
Initial errors and reduced productivity |
$150,000 |
By implementing the above measures the following savings have been budgeted:
During the trial, a number of advantages and concerns were identified. There were initial fears that staff would become bored and complacent, continually producing the same lines. Analysis during the pilot found that, after the first week, staff became quite ’proud‘ of their output and felt a degree of ownership for the lines they were responsible for. Morale improved in a team environment.
Employees were initially reluctant to participate in setting their own error and productivity targets. They tended to overestimate the percentages and did not wish to commit to large improvements. Managers feel it will take some time and training in understanding the financials and operational reports for them to set realistic targets.
Many employees lack formal education and some have limited English, which was also an area of concern when trying to involve them in what they perceived to be ‘management decisions’. This style of management is a huge change in the workplace. Most employees were used to being lectured for making mistakes, rather than encouraged to participate in decision-making and feeling like they have some ownership of the process and outcomes. There is some reluctance and anxiety involved and a degree of resistance from some long-term employees, who feel they are being asked to do a management job and should be paid accordingly. Management fear there could be some industrial relations implications.
Other concerns revolve around productivity levels during the transition. It is understood that it will take some time for employees to operate at full productivity, as they will be working on new production lines and different products. Concerns that deliveries won’t be met and customers will be disadvantaged are key concerns for management.
From a technology standpoint, the new production lines will be faster and more efficient. However, the current service technicians are used to the old lines and lack the experience to service and maintain the new equipment. It is possible that breakdowns could impact on production targets.
Make the following assumptions:
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