Ontario Engineering Limited Case Study[1]

Ontario Engineering Limited Case Study[1] - Ontario...

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Ontario Engineering Limited Case Study Masato Kato UNIVERSITY OF NEBRASKA KEARNEY Ontario Engineering Limited Case Study 2/7/2011 1
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Ontario Engineering Limited Case Study Masato Kato I. Executive Summary In recent years, the CEO of Ontario Engineering Limited (OEL), Mr. Paul Kirkpatrick, has concerned about the firm’s declining profit position. According to Mr. Pail Kirkpatrick, there are at least two alternatives the firm can consider to solve the problem. One of the two alternatives is to get the firm’s volume up to an efficient level on manufacturing. Currently, the firm’s manufacturing business accounts for only 35 % of the firm’s total sales because their production facilities are operating far below capacity. The CEO of OEL, Paul Kirkpatrick, hopes to improve manufacturing to 50 % of OEL sales. Another is to find out whether the firm should get out of the manufacturing business and focus on the wholesaling. As my assumption, the firm might be considering the manufacturing as a part of the cause of the firm’s declining profit. At the same time, the firm feels that some basic changes in marketing could provide the firm with part of the answer to the problems. Therefore, my recommendation mostly focuses on how the firm can restore profitability to a healthy state by maintaining the manufacturing side of their business and increasing the level of manufacturing to an efficient level. Since the firm already owns both the plant and the warehousing facilities, which enable the firm to double sheet metal volume without any additional investment, getting out of the manufacturing business is going to be a huge waste of money. II. Statement of the Problem In order to identify the problems the firm is facing, analyzing the firm’s SWOT and symptoms is critical step. First of all, what were the symptoms the firm had before having the problems? 3
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Ontario Engineering Limited Case Study Masato Kato The firm’s situation has been difficult because they have been involved in two different kinds of business. When it comes to the manufacturing, even if the process of manufacturing is relatively simple, the firm’s production facilities are operating far below capacity. Also, the firms aware that there were weaknesses in the procedure that the company used for establishing prices because the firm’s competitor began quoting prices to OEL customers that were 20% to 25% below the prices established by OEL for purchases of comparable quantities. Overall, the firm’s profit has been declining in recent years. Second of all, what are the firm’s strength, weakness, opportunities, and weakness? Internal Strength and Weakness Matrix and External Opportunities and Threats Matrix would be helpful to identify the problems. Internal Strength and Weakness Matrix
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Ontario Engineering Limited Case Study[1] - Ontario...

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