Evaluation of company Business Mangement

BUS 2530 – Final Project

You and your staff have just been appointed by the Board of Directors as senior officers [CEO, COO, CFO, CIO & VP of Marketing] of Super-Duper, Inc. [S-D, Inc.]. There are various problems and issues that you must immediately address. S-D, Inc. is a holding company that owns five companies [see attachment]. As the new management team at S-D, Inc., it is expected that you will execute the four basic activities of management, namely: Planning, Organizing, Leading and Controlling as the means by which you will improve operational outcomes. You are to submit a comprehensive written report to the Board of Directors detailing how you and your staff will address the problems confronting the six organizations.

Some members of the Board believe that S-D, Inc. and its subsidiaries should be more socially responsible. Another faction of the Board believes the firm and its staff could be more efficient and more profitable.

S-D, Inc. derives its income by assessing a 30% management fee from each of the five companies [i.e., 30% of the after-tax profit]. The company’s goal is to collect 35% in 2016 and thereafter.

The stock prices of S-D, Inc. have been as follows:

Yr. Stock Prices

2011 $45.23

2012 $48.90

2013 $43.09

2014 $39.52

2015 $41.07

The Board of Directors has set a goal for the stock price to exceed $50.00 per share within twelve months. The Board is also considering a twenty-seven percent dividend payout.

Forty-two of the managers are at the senior level. There are also suspicions that white males are over-represented in management.

Managers Non-Managers

Female	62	279
Male	79	186

Managers Non-Managers

White	75	225
Non-White	66	240

The front-line supervisors are closely-knit and highly cohesive and are more inclined to micro-manage their staff than not. The average age of the managers is twenty-nine years with the average age of the non-managers is thirty-seven years.

Forty percent of the non-managers also have Bachelor degrees with none having graduate degrees. Sixty-six of the White managers have Bachelor degrees and ninety-two percent of the Non-White managers have Bachelor degrees.

There were 70 separations among the non-managers during the previous year; total number of non-management employees was unchanged.

Under the previous administration, the COO and the VP of Marketing, the CIO and the CFO all reported to the CEO.

Each of the five subsidiaries is managed by a president. In the past, two of them reported directly to the previous CEO of S-D, Inc. and the other three normally reported to the COO of S-D, Inc. All major decisions for the entire organization [S-D and its subsidiaries] were made by the senior managers at S-D, Inc.

These five presidents were normally assessed only on the financial performance of their company.

A survey was conducted and more than seventy-five percent of the non-management staff believed the following:

· First-line management treated the staff as if they were Theory X employees

· First-line managers would institute solutions that were not workable

· First-line managers were micro-managers

· Senior management failed to articulate a clear purpose or vision for the organization

· The path to promotions is unclear and appears to be subjective

DDD Sportswear, Inc

The Sportswear company purchases its products from plants in Vietnam and Thailand – which it does not own. Those factories are operated under horrific conditions. Employees are paid less than $2.00 per day and nearly twenty-five percent of the staff is under the age of 15. The typical workday for a staff member is twelve to thirteen hours per day, five to six days per week.

All of the Sportswear company’s competitors purchase products from similar sweatshops. DDD Sportswear is the largest customer of the Vietnamese company and the only customer of the Thai company.

The quality of the product has been inconsistent but sufficient. The Sportswear company is seeking permission from S-D, Inc. to allow it to change from a functional to a product departmentalization structure.

DDD Sportswear, Inc. is a retailer with thirty-four stores in Oregon, Idaho and Washington state. Its sales staff is paid a $35,000 a year with no fringe benefits. There are always, on average about 155 sales persons; twenty-five sales persons have quit during the year.

Each store purchases its own inventory directly from the factories in Vietnam or Thailand.

DDD Sportswear has submitted the following data in an effort to determine how many cashiers each store should have:

Each store has the capacity to hire one to six cashiers.

The average number of customers per shift is 40. With one cashier the average wait time is ten minutes. With two cashiers the average wait time is nine minutes. With three cashiers the average wait time is eight minutes and forty-five seconds. With four cashiers the average wait time is seven minutes and fifteen seconds. With five cashiers the average wait time is six minutes and forty-five seconds. With six cashiers the average wait time is six minutes and fifteen seconds.

The estimated cost per minute of waiting time is $4.00 and the compensation cost per shift is $80.00 per cashier.

Lastly, upon review, one of the managers who has been exceptionally effective was discovered to have lied on her resume. She stated she was never convicted of a felony but fifteen years ago she served two years in prison for child abuse. Since then she has been a model citizen.

Yr Sales EAT Inv Capital Cost of Cap Mark Share

2011	980,558,342	12%	330,574,742	11.04%	23%
2012	1,093,588,880	13%	355,984,101	11.25%	24%
2013	1,109,439,333	13%	358,874,332	12.53%	25%
2014	1,298,883,230	18%	409,884,329	12.40%	25%
2015	1,409,332,584	17%	421,984,505	12.24%	30%

The company’s goal is to increase sales for 2016 by eleven percent over 2015.

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