Riordan Manufacturing

Problem Definition: Riordan Manufacturing

Riordan Manufacturing is a well-established global plastics producer employing 550 individuals and projected annual earnings of $46 million (University of Phoenix, 2005). The purpose of this paper is to provide a summary of the business situation. This summary will identify challenges and opportunities, business goals, and potential problems preventing the successful realization of these goals.

The process used to identify the above is the nine-step Problem Solving Approach supported by UOP. Only the first three steps will initially be detailed. These steps describe the scenario, establish end state goals, and frame potential problems.

Situation Background

As a global plastics producer, Riordan Manufacturing employs 550 individuals. The business has projected annual earnings of $46 million (University of Phoenix, 2005). The company is a division of Riordan Industries, a Fortune 1000 enterprise. Riordan Mfg. has production divided among three plants. Plastic beverage containers are produced in Albany, Georgia. Custom plastic parts are manufactured in Pontiac, Michigan. Parts for plastic fan are produced in Hangzhou, China. Corporate is headquartered in San Jose, California with Research and Development located there as well. Riordan maintains major accounts with the automotive parts industry, aircraft manufacturers, and the Department of Defense. Other major customers include beverage makers and bottlers, and appliance manufacturers (University of Phoenix, 2005).

The company has experienced declining sales and uneven profits over the past two years. This has prompted the company to change its sales processes, and led them to adopt a new management system. Recently, Riordan made several strategic changes in the way it manufactures and markets its products. A major change is having sales teams, rather than single salespeople, service customers. Each team focuses on a particular customer segment. Teams include a sales person, product engineering specialist and customer service rep. An improvement in sales is the desired effect from the team concept (University of Phoenix, 2005).

Unfortunately, as changes have been implemented, employee retention numbers have declined. Additionally, several managers have expressed a perceived discontent

in the company's rewards and compensation practices. The company recently conducted an annual employee survey. The results indicate a decrease in overall job satisfaction, particularly in the areas of compensation and benefits

Challenge Identification

Riordan Manufacturing is faced with many challenges, striving to implement successfully the new sales and service processes. These are presented as internal and external challenges. Internal challenges as a business exist in declining sales and uneven profits over the last two years. Internal challenges exist within the company leadership. The executive management is not displaying unity. Locations also provide a challenge in that the business is spread across various states and even China. This poses a cultural and regional challenge as well as leadership possibly not understanding each locations specific set of circumstances (University of Phoenix, 2005).

Other internal challenges are found with the employees. Employee retention has declined. Employees have indicated an overall dissatisfaction in jobs, including areas of compensation and benefits. The employees comprise three demographic groups. Each of these groups has a different perspective on motivation tactics. There is a small group of employees displaying low job performance. Overall, there is declining morale and work ethic company wide.

External challenges are found in the changes to the industry. Success is no longer found in providing the product that best fits the client's application. Clients demand more than products. They want services and solutions that make the use of the products more efficient. They are looking for a complete service team that is available to provide support and solutions on the spot. Additional challenges come from competitors willing to compensate at a higher rate than Riordan Manufacturing.

Opportunity Identification

Internally, each of these challenges present opportunities for learning and development. The business can evaluate current employees and determine their effectiveness in the new sales management system. The change process also allows management development in the areas of how to improve morale, effect techniques for addressing and resolving employee dissatisfaction, and strategize for handling conflict. The team system will provide opportunities for workers to collaborate and bring more extensive customer solutions to the table.

Other internal opportunities are evident in results indicating twenty-five percent of employees as high achievers. The company also has a large group of mid-tier performers. Many of the employees like their jobs, are loyal, and want to stay with Riordan. Riordan's CEO has stated the company is known for treating employees well. The company is ISO9000 certified and practices the Six Sigma quality approach.

The company has diversified product offerings. These vary from plastic beverage containers to car parts. The company has a diversified customer base as well. These customers come from the automotive parts industry to aircraft manufacturers to the Department of Defense. New business opportunities exist in meeting the new

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