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Morgan Car Company Case Study

Morgan Car Company Case Study

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Published by Marius Hince
Morgan Car Company Case Study
Morgan Car Company Case Study

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Published by: Marius Hince on Feb 25, 2010
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11/24/2012

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Morgan Car Company Case Study
There were many problems associated with the Morgan Car Company. We have compiled alist of problems associated with this car company and have split them into 4 different areas;Production, Planning, Management and Workforce:
Management
The management are conservative in their approach to change; therefore they areunwilling to change anything as it generates fear amongst them.
Owners say that change would damage the main selling point – The hand craftednature of the car.
They give the impression that if they were to change anything then this would exhaustdemand and therefore put the company at risk.
Relating to the above point is the fact that the management seem to be proud of theridiculously long waiting times.
Waiting times can’t be decreased because the management want change withoutchanging anything i.e. going from 9cars/week to 10cars/week.
Father and Son opinion is that the British public are patient and willing to wait for their car 
Workforce
The workforce(with exception to some people) have the same opinion as themanagement – unwilling to change as they think this will damage the nature of the car and will also exhaust demand.
Takes 4 years to train an apprentice within the company as most of the workforce iscraft/skill based.
Want more money to increase productivity.
Engineer Morris Owen is the only person willing to accept change and to put newideas forward i.e. build car in units and put the engine in last.
Planning
Have up to 50 years of stock in some places; this seems to be a bit extremeconsidering some of the models aren’t made anymore.
They have a visual based stock control system – therefore making ordering harder andmore unpredictable.
The amount of production flow is governed by the sales office.
 
Production
Production Layout is not practical as to manufacture the car, they need to put thewheels on first and then push it up and down a hill numerous times during themanufacturing phase.
Solely handcrafted car – therefore leading to big throughput times; about 3 months insome cases.
Expensive parts fitted early on in the process leading to a lot of money ‘left lyingaround’.
Traditional company – no jigs or fixtures to reduce set up times.
Labour costs about 30 – 40% of the cost of the car.
Hand built so therefore there are little or no power tools or new machinery
Other Problems
Some people are waiting 4-5 years for their car to be delivered.
Steady sales so therefore there is little profit margin.
Problem will arise with inflation as there will be increase in wages with the samesales margins – therefore reducing profit margins even further 
‘A company that is not progressing is regressing’
Demand conceals an enormous amount of problems within the system.
Unwilling to change the prices of the car; therefore there is
no
additional money for investment.As you can see there are a vast majority of problems relating to the overall system at theMorgan car company, therefore we have come up with a list of solutions that the managementcould take into consideration.
SolutionsShort Term
Implement job/salary security despite the changes.
 
Owners to rethink the future of the business and move away from ‘traditionalmanufacturing’ layouts.
Implement new jigs and fixtures to help with production.
Try and shift the attitude of the workforce and approach Morris Owen’s way o f thinking.
Regular staff meetings – to discuss the future of the company to try and implementchange
Implement a non-visual based ordering system. This would require new technologyto be brought in such as a computer.
Find out the actual demand of the car and carry out various studies to find out the problematic areas and the areas that need improvement.
Small increase in prices to provide a little more capital for investment.
Carry out customer studies to find out what customers want.
Medium Term
Alter the manufacturing process to suit demand.
Redesign and reorganise factory layout to improve the throughput of the system andreduce the amount of waiting times.
Introduce more IT facilities and CAPM facilities to assist in the planning process.
Introduce more streamlined ways of training new apprentices and eventually movetowards de-skilling some of the processes within the factory.
Reduce stock levels and the amount of spares that they have i.e. there is no need for 50years worth of parts.
Give production and design engineers more say in the process such as in the layout of the factory.
Redesign the car process e.g. design for manufacture instead of just design!!!
Expose the bottlenecks within the system and streamline production to the capacity of the bottlenecks.
Bring in a system of synchronised manufacture.
Long Term
Look to move to custom built premises with a highly thought out production layout.
Increase prices to improve profit margins – a little price rise again just like in the shortterm solutions. This will help the company to continue to develop.
Move cars to the luxury car bracket, this will help justify the rise in prices.

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