Birmingham Case Study
Birmingham Furniture Company: Suggested Problem-Solution Case Report
1. Statement of Problem
After its establishment in 1982, the Birmingham Furniture Company (BFC) expanded significantly, and achieved continuous growth in profits until 2009 when turnover reached a peak of £15,000. However, since then the company has encountered a number of setbacks. Staff have become increasingly dissatisfied and some have resigned. In addition, a new competitor has started operating nearby. It is likely that these difficulties have led to the fall in turnover, which reached only £12,000 per week in
2010. The purpose of this report is to analyse these problems, and suggest some practical solutions to enable the BFC to flourish again.
2. Analysis of Data
In order to raise profitability, the Vines need to improve company management, boost staff morale, and deal with the new competition.
2.1 Management Structure
The BFC has expanded considerably since its establishment. However, it still retains the informal management structure of a small company, which is now inappropriate. As a consequence, management and staff responsibilities are poorly defined and the chain of command is not clear. An obvious example of this is the fact that Mr and Mrs Vine’s roles have become blurred, and staff never know who to approach when problems arise; this led to stock being ordered twice from the same supplier in 2008. In addition, Ms Clarke’s unpopular appointment as ‘unofficial’ supervisor is preventing her, as a relative newcomer, from being able to exercise effective authority over the workforce. Most importantly, the Vines are too busy to communicate with each other or their staff. As a result, they were unaware of the dissatisfaction and low morale of their employees.
2.2 Employee Morale
Two full time members of staff have recently resigned, and training their replacements is time consuming. The Vines believe this has contributed to the fall in turnover. However,
1. Statement of Problem
After its establishment in 1982, the Birmingham Furniture Company (BFC) expanded significantly, and achieved continuous growth in profits until 2009 when turnover reached a peak of £15,000. However, since then the company has encountered a number of setbacks. Staff have become increasingly dissatisfied and some have resigned. In addition, a new competitor has started operating nearby. It is likely that these difficulties have led to the fall in turnover, which reached only £12,000 per week in
2010. The purpose of this report is to analyse these problems, and suggest some practical solutions to enable the BFC to flourish again.
2. Analysis of Data
In order to raise profitability, the Vines need to improve company management, boost staff morale, and deal with the new competition.
2.1 Management Structure
The BFC has expanded considerably since its establishment. However, it still retains the informal management structure of a small company, which is now inappropriate. As a consequence, management and staff responsibilities are poorly defined and the chain of command is not clear. An obvious example of this is the fact that Mr and Mrs Vine’s roles have become blurred, and staff never know who to approach when problems arise; this led to stock being ordered twice from the same supplier in 2008. In addition, Ms Clarke’s unpopular appointment as ‘unofficial’ supervisor is preventing her, as a relative newcomer, from being able to exercise effective authority over the workforce. Most importantly, the Vines are too busy to communicate with each other or their staff. As a result, they were unaware of the dissatisfaction and low morale of their employees.
2.2 Employee Morale
Two full time members of staff have recently resigned, and training their replacements is time consuming. The Vines believe this has contributed to the fall in turnover. However,