Case Study of Hawkesbury Cabinets Pty Ltd

Question: Discuss about the Case Study of Hawkesbury Cabinets Pty Ltd. Answer: Introduction A small business usually has to deal with both smaller and larger problems with practical solutions keeping costs and management in mind. Having a roadmap with business expansion plans regarding space development, more deliveries, taking more orders, and contracting out work is a pathway to success. This case study speaks about the production system of the fictitious company Hawkesbury Cabinets Pty Ltd with two persons Mei and Fung Chen at the helm of it. Fung being a master cabinetmaker and Mei being an interior designer fused their creative ideas in creating this boutique company. Creative ideas, craftsmanship, attention to detail are all necessary to build products with perfection and own unique appeal (Ball, 2015). For a company to manage though it is entirely a different story, where many other employees will be involved and management will be needed accordingly (Clough, 2015). With expansion in inventory, raw materials, outsourcing cost, timely delivery, and attention to all ty pes of clients are all critical components in running a business, and it gets increasingly challenging and complicated with time (Khanna, 2015). This study undergoes through the company Hawkesbury Cabinets inception, their underlying principle in creating products and the secret to their success, to their business expansion plans following success. The difficulties have been underlined, pointed out and critically analyzed the companys problems with managing factory expansion with limited space in the current plant, inventory, and raw material costs upswing, and imbalance of production to scheduling time. Discussion and Analysis Hawkesbury Cabinets Pty Ltd is run by two companies Mei and Lei. Both take on the roles of additional management as required creating management issues. The current production system of manufacturing cabinets includes both standardized, and custom made kitchens from one kitchen up to five kitchens. The company has only one operating plant in Mulgrave, which accommodates all tools and machinery. They are separated categorically and are layout by the workflow. Although the manufacturing plant had space to accommodate all kinds of machinery they did not utilize space efficiently to provide for future expansion (Brown, Bessant Lamming, 2013). For manufacturing, the equipment used were of all high quality so as not to compromise with the quality. The tools were organized in such a fashion that essential components like cutting tables and saws were kept in one place, shapers, and routers in another location. Lathes and other less frequently used equipment were stored separately (Schneider , 2015). Painting and finishing were done in an environmentally controlled room towards the rear of the factory since this is the final stage and this process takes up a lot of space and needs to be carefully handled (Tomshinsky, 2014). The attention to detail, in this case, shows the craftsmanship of the company builders in every cabinet they produce. The finished products speak for the company themselves, and the company takes a high esteem in them (Christopher, 2016). Since the company had only two persons on board, there was no pressure from different managerial layers or complexity to the business. The company went on to take contract works to small spec' builders as the firm grew, by providing them with kitchen cabinetry. One issue the craftsmen face is the fact that since both custom and standard kitchens take up a lot of time, and the quality for both of them are of the same quality, the time allocated is of a concern, which leads to longer delays for new orders (Grant, 2016 ). Longer delays in production and manufacturing mean that the production queue is full. The move to builder's line of the kitchen was made as a part of increasing demands without increasing much of the workforce. Contract work especially makes sense as they are paid for the work done and not as full-time employees, but the downside is that sometimes the quality may differ. Since each and every custom kitchen took quite a long time, smaller orders were left on hold. It resulted in an increase of longer queues of pending and unfinished work scattered throughout the factory, and custom kitchens were given the most priority (Monczka, 2015). Businesses usually follow this tactic to focus on bigger clients or large orders, where every deal can fetch a large sum of money, and therefore they incline towards the profit (Rodriguez, Peterson Krishnan, 2012). Smaller orders are finished in delays because they would not fetch much money and so are given little priority in this situation. The spacious factory space of the Hawkesbury quickly clogged up with lots of work left undone. The vision of the two made them success in business, and their dedication to quality earned them the reputation of craftsmanship, but their narrow vision in predicting future growth and expansion plans hurt them badly, cost the efficiency of the whole process and disrupted the balance of the work-production nature (Hansen, 2013). With the move to production in kitchen builders line Mei Chen felt pleased that the company has been in significant progress. Their strong presence in manufacturing custom kitchens have been getting strong, and the builder's line was increasing. But behind the scenes a lot of capital was tied up in raw materials, stock inventory, finished product and coupled with the increasingly delayed time for both custom and standard orders delivery. Even the costs associated with the builders line was on a rise. When business capital is tied up in the inventory, materials and costs of outsourcing, it becomes difficult for the company to expect profit margins without making a significant change in the business strategy (Sadgrove, 2016). The company was struggling in both financially and in managerial aspects as the accountant declared that the profit margins were not up to the expectation. A companys reputation lies in not only its product but also in its overall service and its internal work cul ture (de Oca, 2015). The available space in the factory was not sufficient to accommodate for any expansion plans, which meant they would have to rent out spaces. This usually happens when the company does not have any ready-made plans for expansion from the beginning, and therefore, it chokes up when the business gets complicated. Mei Chen decided to consult her brother Fung Chen, with the proposal of expansion plans. With the enlargement of a company, it needs additional management at many levels to oversee production and employee satisfaction (Zikmund, 2013). A company which is growing steadily has to create a roadmap for the future with expansion lines (Prahalad Ramaswamy, 2013). Unfortunately, that was not the case for Hawkesbury Cabinets, and therefore, its production was choking with its management was getting abysmal for lack of additional control. Conclusion From the given case study on Hawkesbury cabinets, it can be concluded that the company has earned itself a reputation in manufacturing quality cabinets, and is a testament to the skills of both Fung and Mei Chang. A right decision was taken when the duo signed off contracts to spec' builders when the company was flourishing with orders. Problems started to occur when the production was not able to keep with the supply and demand, and since the company focused on quality and quantity. It resulted in queues of pending orders and unfinished cabinets, and scheduling became abysmal. Mei Chang ultimately decided to expand by renting spaces after consulting with Fung Chang. With the rise in orders and increase of builder's line, the profit margin started to become less, and the company will have to decide whether to buy high-quality equipment for the new space or focus on a new strategy. References Ball, R. (2015). The Future Of Luxury: Capital Of Creation(Doctoral dissertation, State University of New York). Brown, S., Bessant, J. R., Lamming, R. (2013).Strategic operations management. Routledge. Christopher, M. (2016).Logistics supply chain management. Pearson Higher Ed. Clough, R. H., Sears, G. A., Sears, S. K., Segner, R. O., Rounds, J. L. (2015).Construction contracting: A practical guide to company management. John Wiley Sons. de Oca, I. M. M., Snoeck, M., Reijers, H. A., Rodrguez-Morffi, A. (2015). 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