I decided to work on the case: ADAM BURKE AND PBM PLASTICS:
MESSAGE IN A BOTTLE. The reason being that it offers a great study in multiple
aspects of business – operations, leadership, supply chain management and HR.
Most of the manufacturing industries face the same problems faced by Adam Burke
while handling PBM plastics. The new product or service required for the
company is to reimplement the old process of running the manufacturing which
the company used to follow before the it has been handed over to new management
and reforming the best team with motivation.
The problem faced by Adam Burke and
PBM products here is that PBM Plastics is way behind on the output and as a
result PBM Products is faced with the risk of not shipping out its products as
planned. Whenever a company is acquired, the ownership change results in a
culture clash of sorts. The priorities of the earlier management might be very
different from the acquiring company. The new management might not understand
the intricacies of the business right away. It is extremely crucial to get a
good hold of the processes pretty early. It is also important to have the right
process in place to identify problems before they become big and address them
A deeper study into this case would
improve my understanding of the different aspects of business. The learnings I
would take would help me in understanding operations and management better.
PBM plastics is way behind on the
scheduled production. PBM products which has an exclusivity Volume commitment
with PBM plastics is facing the risk of not shipping out its products as
planned. It also faces the risk of hundreds of dollars in fine and a
reputational risk along with it. The people who have the best chance to fix the
current problems with the machinery have grown disinterested and have not been
actively involved in addressing the issues.
The major problems facing PBM plastics
1. Short term savings Vs. long term
2. No proper monitoring system
Belongingness to the company
The problem facing PBM plastics
would not just impact PBM Products today, but would also have a big impact on
how the company can grow going forward. These issues, if not addressed
systematically, can derail the company and cause serious problems. The earlier
the problems are identified, the better it is. Whenever acquisitions happen,
the first 1 year is very crucial as the new management and the employees are
trying to understand each other and find a way to take the company forward. It
is also one of the reasons why most of the companies that acquire another
business require that the management of the acquired business continue with the
It is also a great opportunity for
the entire PBM plastics team to build a great company that could excel in the
plastics industry. If they can turn it around now and fulfill the orders of PBM
products, it would give them a lot of confidence and motivation to achieve more
progress. PBM plastics can also supply to a lot more companies if the
efficiency can be built into the process again.
The best way forward for PBM
Plastics would be to form a team that would take care of the production. The
team could be called Output Delivery Team (ODT). ODT will have the two guys
that Burke rated highly – Engineering Manager and Maintenance Manager. Apart
from those two guys, marketing manager, plant manager and the CFO would also be
part of the team. The first two guys would be able to address the problems
before it is too late and also fix them pretty early.
Making the Engineering and
Maintenance Manager a part of a high level team would give them a lot of
confidence and motivation, which is currently missing. The team would also be
able to explore more opportunities in the plastic business. As is evident, the
price of plastic is increasing pretty rapidly and the expertise that PBM
plastics has been able to gain would hold them in great stead in the industry.
The key is to first take SparPack
Management into confidence. Adam Burke would have to convince the management of
SparPack to put the ODT in place. ODT would also have to follow the other two
recommendations made by Adam Burke – monitoring system in place and then have
six weeks of inventory at all times. In trying to save costs in the short run,
PBM plastics is losing out on the production efficiency by trying to save money
in the short run. IT Monitoring system would also have to be put back in place
as it would identify a lot of problems well in advance before it goes out of
Methodologies like Total Quality
Management, Kaizen and 5S should be implemented to make everyone in the company
understand the importance of Quality in the company. There has to be a clear
focus on ensuring that the quality practices are strictly adhered to.
Total Quality management is a
philosophy can be understood as a set of
guide line or fundamental rules that many company’s should follow to
improve their standards and efficient outputs. By implementing this methodology
by a company helps them to create better process to produce the product with
proficiency. It is necessary for the company to track the demand and
expectation of the customer(1).
The first important target is to get
“Percentage PFC Output Goal” upto 100 and the Uptime percentage to 95%. PBM
Plastics has had the history of solving problems in a very short period of time
with innovative approaches. The team needs to be given the support to turn it
around. The gap in the orders and production needs to be tracked with an aim to
overcome it at the earliest.
HR: Team building exercises should
also be conducted so that everyone in the team identifies with the goals of the
company and works towards achieving them. All the employees should be given
confidence that their concerns would be addressed by the ODT. Reward system has
to be in place for individuals as well as teams.