Question:The following appeared in a report presented for discussion at a meeting of the directors of a company that manufactures parts for heavy machinery:
“The falling revenues that the company is experiencing coincide with delays in manufacturing. These delays, in turn, are due in large part to poor planning in purchasing metals. Consider further that the manager of the department that handles purchasing of raw materials has an excellent background in general business, psychology, and sociology, but knows little about the properties of metals. The company should, therefore, move the purchasing manager to the sales department and bring in a scientist from the research division to be manager of the purchasing department.”
Discuss ...
Answer:The author of the report claims that inappropriate qualification of the manager of purchasing department cause defects in his work and delays in manufacturing and, consequently, falls of revenue. To improve the situation author suggests appointing of a scientist from research department on position of this manager. However, such statement has some serious defects and poorly supported. The most important flaws in argumentation will be analyzed below.
First, author tells us that fall of revenue to some extent is caused by poor planning of metals purchasing. Obviously, such events as revenue descending, means sales descending, caused by company’s internal factors are exceptionally dangerous because they can lead serious consequences, such as cancellation of contracts, damage to reputation, and loss of market share. It is absolutely inacceptable that any fault in one particular unit leads to such results. So the company suffers form much more grave problems than just wrong person on wrong position. These problems lie in overall process organization, shortage of reserves on different stages of manufacturing process and, as a result, in low resistance to external impacts. To illustrate this point, one could pay attention to manufacturing process of big computer hardware plants. Such plants always have stock of spare parts to maintain uninterrupted manufacturing process in case of temporary problems with supplies as well as stock of ready devices to keep delivery schedule in case of plant suspensions. Therefore, business process redesign could be more actual need than staff reappointment.
Second, as mentioned in report, the manager of the purchasing department has excellent management background and skills necessary for successful negotiations with suppliers but, perhaps, suffers form the lack of specific knowledge about metals. It seems logical that the best solution of this problem could be some additional courses or training for the manager. It is possible, that such activities could be successfully performed by research department of the company. Contrary, appointment of the scientist on the purchasing manager’s position is a questionable decision. This person could have good knowledge about metals but most likely will use only its tiny part performing new functions. On the other hand, without management and communication skills the scientist will definitely meet some difficulties on the new position that could result in even more serious problems for the company than it has right now.
In addition, the moving of the purchasing manager to the sales department seems a bit strange and illogical. Having strong knowledge in general business, psychology and sociology the manager, perhaps, knows nothing about heavy machinery. Such situation could lead to faults in work of sales department. Taking into account great importance of sales for business success, it should be avoided.
Thus, the author should carry more complex analysis of current company’s problems and more carefully examine human resources issue. As long as suggested plan relays on unproved and questionable assumptions it should not be used.