CITATION FIX

Organizational Information Bottling Production Equipment The top-of-the-line equipment is exactly what you’d expect: It’s costly, puts out a large capacity, requires little maintenance (i.e., low maintenance costs), and requires the most people (nine bottling employees and two assistant maintenance workers) to operate. Because it requires the most people, you would have to double your team and provide extensive training to all team members. Also, though the maintenance costs are low, the initial cost is expensive. That said, its output is the largest of all options, and thus could help grow the company the most. But it is also arguably risky because of the high initial cost, both in machinery and hiring of new people, and the “up-skilling” of employees will take time. The middle-of-the-road equipment is just that: medium cost, and medium capacity output. It requires notable human capital, so you would have to hire a few extra hands (requires seven bottling employees). Additionally, some training would be required for all employees, but it wouldn’t be extensive. The maintenance cost, however, is fairly high. Though this is the least risky, its long-term impact on cost and its inherent limits on growth are a concern. The low-end equipment is fairly inexpensive, but also has the least output. Additionally, it requires fewer employees to operate, and thus there may be layoffs (requires two bottling employees and no assistant maintenance workers). The maintenance cost is moderate. There are concerns in regard to your team capacity: Layoffs would likely be on your team, and there is no assurance NHM could find a position for them elsewhere. Also, this equipment offers the least opportunity for growth because it has the lowest output. The refurbished machine is the least expensive option, with medium capacity. You wouldn’t need to hire new employees, but would need to provide some training to the ones you have. Additionally, the maintenance cost is extremely high because it is an old machine, though it has some new parts; refurbished machines break down frequently, so in addition to its high cost, the capacity may be affected by time spent offline. Stakeholders’ Roles and Perspectives The board of directors helps fund the brewery. They are excited about what this major investment means for the future of the company! That said, they are focused mainly on high capacity; they are optimistic and foresee a revenue spike if capacity is increased. Secondly, the cost is a concern; their optimism is tempered by the realities of the budget and their ability to fundraise. You, the brewmaster, are most concerned with your team, of course! The human capital needed for each is important not only for the budget (more people = more paychecks) but also for managing larger teams. Thus, the lower human-capital machines are your preference. It would be difficult to expand quickly, both in hiring and training new employees and in regard to budgeting for this influx. That said, you would like to see a higher-capacity machine because more product is good for the company in order to keep up growth, but it’s less of a concern than your worry about straining the team.

The owner is a bottom-line pragmatist: His main concern is the cost. Because some of this cost is reflected in maintenance, this is his secondary concern, but only in its relation to the overall cost. Additionally, there is a potential cost in hiring additional team members, so human capital is an interest of his as well. The maintenance manager, who is a great employee given his extensive history in brewing at this exact plant before NHM purchased it, is a critical component of the success of the company. His main concern is maintenance, since this is something he single-handedly handles. He knows his team and what they can handle; when the work takes too long, production stops, and the company loses money. That said, he’s also clear that the more human capital that’s needed, the more people there are to potentially disrupt the machinery. Thus he would prefer a machine that has lower human capital. Organizational Goals

 Increase state-wide market share from 7% to 10% within two years

 Be known in the community as family-values oriented

 Earn third-party recognition for “green” practices, including energy and waste reduction

 Diversify product offerings with the creation of at least one new product by the end of the fiscal year

Team Capacity Information: Brewmaster’s Team Brewmaster ($60,000 per year)

 Creates beer recipes

 Orders ingredients for beer recipes

 Cleans and manages equipment

 Conducts quality assurance checks (beer tasting)

 Manages brewing staff

 Manages vendor relationships Assistant brewmaster ($35,000 per year)

 Assists brewmaster with brewing process

 Cleans and manages equipment

 Conducts quality assurance checks (beer tasting)

 Ensures appropriate inventory levels Five bottling employees ($28,000 per year)

 Ensure safety standards on bottling equipment

 Monitor production process

 Assemble final six-packs Shipping manager ($45,000 per year)

 Packs goods to be shipped

 Uses forklift to fulfill orders

 Manages vendor relationships

 Manages shipping schedule

Maintenance manager ($50,000 per year)

 Performs regularly scheduled maintenance on all equipment

 Manages vendor relationships

Maintenance assistant ($30,000 per year)

 Maintains maintenance logs

 Assists maintenance manager