DECISION REPORT

FOR

Kanpur Confectioneries Pvt. Ltd. (KCPL)

Jaykishan Joshi (24) Sem 1 Batch ( !o"# 1) 2$$%&1$

Submitted by:

'an#"! Con(ectione!ies P)t* +t,

PROBLEM:
It is described as a situation which needs an action to be taken and keeping this in view the situations are: Sho!t te!m sit"ation Offer of A One Confectioneries Pvt. Ltd.(APL) .e,i"m te!m sit"ation E erge as a strong co petitor and reduce the cost of production +on/ te!m sit"ation !eco e a "eader in the arket of g"ucose biscuits and e#tend the arket seg ent to pre ier custo ers. $ohan %u ar &upta had ver' good business foresight and ski""s but his sons who hand"ed the business were not so efficient as hi . ()$P*O$(: $ohan &upta captured the +nd "argest arket share with production of ,,tonnes. onth within /'rs of co ence ent of %CPL but his sons were not ab"e to increase production be'ond ,+- tonnes. onth even after e#pansion of prod. capacit' to +0- tonnes. onth. *he 12 $anager 3ivek &upta fai"ed to reduce the rate of absenteeis . 1e"p of technicians was sought but i prove ent in production or other areas was not evident. 4et profits of the co pan' were dec"ining even after increase in turnover.

CRITERIA:
In deciding criteria (5O* Ana"'sis is used to eva"uate various aspects of business: {Internal factors} (trengths: 6ecision aking is participative Ethica" va"ues 4on7interference in anage ent Production capacit' 8 +0-tonnes. onth 5eakness: 9nder uti"i:ation of prod. capacit' 1igh percentage of absenteeis 5astage in ore

{External factors} Opportunities: E#p"ore new arkets Increase current share in arket !eco e C$9(Contract $an. 9nit) *hreats: &overn ent ta#es 9norgani:ed sector Organi:ed sector Low cost ovens

(Positive) (,) (+) (/) (0)

(Negative)

On the basis of SWOT Analysis the following criteria are developed: Profit Advantages to business 6isadvantages to business ;uture of business and !rand na e

OPTIONSi* ii* iii* i)* !eco e C$9 for A O4E CO4;EC*IO4E2) 2e7structuring the production process and introduction of Increase productivit' of current workforce (upp"' to canteens of institutions echani:ed process

EVALUATION:
i* !eco e C$9 for A O4E CO4;EC*IO4E2( P3*.L*6.: (,)Profit: Conversion charge of 2s.,<--.tonne is paid and the fi#ed e#penses are: 2s. /= ><=---((a"ar'8+= ?<=--- @ Interest8<-=--- @ Others8A-=---) (o to reach at break even point: !EP8 fi#ed cost . contribution per tonne 8 /><---.,<-8 +<?(appro#.) tonnes. onth (+) Advantages: 4o e#penses on advertise ent= attracting custo ers or brand bui"ding. 2egu"ar inco e E#pertise in production Low risk (/) 6isadvantages: 4o independence in decision aking Contract wi"" bind %CPL to continue business as C$9 for /'rs 9ncertaint' of future re"ations with APL. If ACL asked to change production process or eBuip ents then capita" e#penditure wi"" have to be ade b' %CPL (0) ;uture of !usiness and !rand na e: If the co pan' is successfu" in carr'ing out the orders regu"ar"' the co pan' can be associated with APL for a "ong ti e and assure its e#istence in the business. *he !rand na e wi"" get e"i inated fro the arket ii* 2estructuring production process b' introducing (,) Profit: echanica" processes :

*he co pan' wi"" be ab"e to uti"i:e production capacit' b' increasing production and the cost of production wi"" reduce. (+) Advantages: Less "abor wi"" be reBuired for production 9nifor it' in Bua"it' 4o restriction of ti e to use achiner' Production cost wi"" reduce (/) 6isadvantages: Capita" wi"" be reBuired and at present co pan' a' not be ab"e to afford capita" e#penditure. Avai"abi"it' of ski""ed "abor to operate achines 1igh risk of investing in achiner' (0) ;uture of business and !rand na e: *he business wi"" be ab"e to co pete with other co petitors and e erge as a "eader. *he brand na e wi"" a"so prosper owing to the Bua"it' and arket share. iii* Increase the productivit' of current workforce: (,) Profit: *he productivit' of e p"o'ees wi"" i prove significant"' and cost of production wi"" reduce as we"" as the production wi"" increase. (+) Advantages: I proved efficienc' of e p"o'ees Increase in production 2eduction in production cost 1ea"th' working environ ent Cob satisfaction Low absenteeis 1igh ora"e of e p"o'ees E erge as "eader in arket with the co petitive advantage of satisfied workforce

(/) 6isadvantages: E p"o'ees a' ask for higher wages (o e e p"o'ees a' "eave Dob if the' have to beco e efficient and regu"ar at work (0) ;uture of business and !rand na e: *he business wi"" prosper b' reaping benefits of otivated and efficient workforce and the brand na e wi"" co pete with the "eaders in ter s of "ow cost of production and peop"e wi"" prefer $%& !rand for its Bua"it' and co petitive prices. i)* (upp"' to canteens of institutions: (,) Profit:

*he argins of profits wi"" be "ow but if sa"es are ade to on"' canteens of institutions the e#penses on advertise ent and others to increase sa"es wi"" reduce and so the profits wi"" increase.

(+)Advantages: Increase in sa"es to canteens of institutions. 2eduction in pro otion e#penses. 2egu"ar supp"'. Production in accordance to reBuire ents. Potentia" to co pete on Bua"it' and cost basis as the co petitors have not entered this arket seg ent.

(/) 6isadvantages: In order to co pete on cost basis the Bua"it' a' be ignored Canteens are not bothered about Bua"it' and on"' consider cost as i portant (0) ;uture of business and !rand na e: *he business wi"" be ab"e to earn profits and continue the business *he brand na e wi"" not be so uch i portant as the canteens give i portance to cost not na e. A"so in the arket the custo ers wi"" be diverted towards other brands as %CPL wi"" be se""ing on"' to canteens.

DECISION:
Increase the productivit' of e p"o'ees And the offer of APL is not accepted as the co pan' wi"" not be ab"e to reach to break even sa"es at a ver' "ow conversion rate or 2s. ,<--.tonne. *he other two a"ternatives are not so attractive and reasonab"e keeping the financia" position and future of business in ind.

ACTION PLAN:
Identif' the reasons for absenteeis and e"i inate the as far as possib"e $otivate e p"o'ees for increase in production Increase in wages Introduce piece wage s'ste Provide entertain ent to e p"o'ees in their free ti e Co""ect regu"ar feedback of e p"o'ees and review their co p"aints (et standards for Dob processes

CONTINGENCY PLAN:
If the workforce does not respond favorab"' to the new changes then %CPL start supp"' to canteens of institutions a' think to