Honor Code

I certify that I did the paper solely with my efforts. The paper is made from my own original initiatives, and
was not plagiarized or copied from other sources, e.g., academic. All sources are properly cited and
analyzed, and all information from the company is from the company alone.

With integrity at heart,

Name (Student ID Number) Signature

Ong, Jared, Darren (183620)

Signed and submitted on November 9 , 2021.

 CASE ANALYSIS
Key Issue and Problem Definition
Packing Packers Inc. was established by John Doe, with the objectives of expanding the value
chain and delivering quality product packaging in both local and international markets. Through the
years, the company has ensured financial stability by innovating and diversifying its portfolio for its
consumer bases. It has also been striving to improve its overall processes.
Currently, the company is now faced with the problem of achieving internal and external
performance growth in the long term. With its current values and structure, the business’s present
scale of operations may be deemed unsustainable in the long-term. To best address this, the main
problem will be dissected into three objective statements. First, how can the company ensure
quality labor and high performance productivity? Having a skilled and experienced workforce is a
key driver to the sustained success and efficiency of any company. When employees’ work
competencies are monitored and improved, it would be easier and faster for the company as a
whole to detect and overcome inconsistencies within its existing practices and processes. Second,
how can the company continue to grow its revenue and minimize its cost? Profitability is a crucial
indicator that solidifies financial backing to pursue the company's long-term objectives and
strategies. Third, how can the company streamline its current work processes and improve
workflows? Operations generally must be flexible to respond quickly and remain effective to any
risks or new changes that arise. Going further, clear operational systems translate back to Packing
Packer Inc.’s culture of innovation as employees have better avenues and opportunities to provide
creative long-term solutions.
Assuming that the problem is effectively addressed, the best case scenario for Packing
Packers Inc. to achieve a well-reputed leadership, operational excellence, strong financial
performance, and overall value delivery. This will allow them to continuously pursue growth and
expansion. On the contrary, should the problem remain unsolved, the worst case scenario is to
experience high attrition rates, cost redundancies, and decreased overall work quality.

Assumptions and Alternatives

Before delving deeper into the discussion, the case analysis assumes that the pandemic
crisis did not occur, and operations across businesses are at normal state until 2022. In strategizing
alternatives, TOWS and SPACE matrices were utilized to determine the optimal direction (See
Appendix A and B). With that, such alternatives are outlined below.
The first alternative is to source highly-experienced talents through staffing agencies. This is
in consideration to the unsettled human resource department systems and poor recruiting and
screening processes. Basically, the company coordinates with the agencies on job summary
(description, responsibilities, & qualifications), assessments (questionnaires & interview), and
standards of performance. It then pays a fee depending on the amount of actual recruiting the
employees that needs to be done. From this, the owners gain much more confidence in turning
over some work deliverables as the talents have valuable skills, and experiences.
The second alternative is to loosen up the control of family owners on organizational
functioning. This is diametrically opposed to Packing Packer Inc.’s current leadership strategy. For
this action, the family leaders delegate some decision-making responsibilities to current employees,
resulting in more autonomy and less standardization. Since the family owners continually choose
previously-utilized strategies, employee participation will encourage a focus on integration of
diverse ideas rather than conformity to a common idea.
The third alternative is to design a training program for its employees. The plan of
strategizing the company’s future orientation implies that employers will need succession plans for
talents who have the skills to manage the existing operational activities. The program requires the
leader to effectively clarify expectations and the employees to better understand the different
lenses of their new or additional roles. It also helps the latter discover their competencies in which
they could use additional education support.
Before proceeding, the advantages and disadvantages of these three alternatives were
delineated in Appendix C.

Recommendations
In evaluating the advantages and disadvantages of each approach, certain factors were taken
into consideration as gauges for the appropriateness of the proposed solution in light of Packing
Packers Inc.’s current position and envisioned future. These key criteria include the company
performance (how well employees are achieving the goals), organizational culture (beliefs and
assumptions shared across internal and external stakeholders), corporate sustainability (cost
efficiency, brand image improvement, & investment value).
Based on the application of the criteria in a weighted average method, the third alternative
is the most optimal (See Appendix D). Investment on training and development offers the most
tremendous company returns for the following reasons: First, the strategy encourages the
employees to be innovative and willing to perform at a high level. Second, allowing employees to
excel through mastery of competencies provides them a sense of self-worth and accomplishment.
Third, the action reduces numerous indirect expenses (e.g. attrition and disengagement) and is
likely to attract potential new employees in the future.
As for the other alternatives, they may contribute to the boosting of company performance,
but they also provide a detrimental effect to company finances. To illustrate, from Packing Packer
Inc.’s perspective, employment agencies may not always choose the most qualified candidate for
the position as both share different sentiments on recruitment of talents. Furthermore, the lack of
employee expertise in a participative management system may lead them to executing something
ineffective for challenging activities. The said weaknesses for the first two alternatives indicates a
probable increase in financial risks.

Implementation and Action Plan - The AFRO Method

Phase 1: Aligning with Organizational Design
New strategy implementation often requires changes in the way an organization is
structured. Generally, organizational structure dictates how the other three phases will be executed.
The traditional and conservative management design of Packing Packers Inc. would not be
conducive for pursuing the proposed strategy. Based on its current structure, the general manager is
likely to get swamped with work, if he has to approve every training and development initiative
decision in the human resource department. It is worth noting that four departments are also
directly reporting to the same person.
Packing Packer Inc.’s lack of systems may require them to consult professionals with regards
to change management. This is to ensure the company transition in an effective and efficient
manner, where stakeholders are properly informed all throughout. In the process of the transition,
the company may consider purchasing change management resources such as manuals for different
business functions. The materials provide stakeholders an overview of the common change
management occurrences and ways to properly respond to them.

Phase 2: Formalizing Policies

Considering that employees across departments will be trained, it is important to set
standardization or formalization in terms of the training arrangements. The formalization of policies
provided consistency and clarity on how the initiative is being implemented. It provides a basis for
management control and allows coordination across organizational units. Without considering this,
confusion and disorientation are likely to occur, increasing the vulnerability of the company towards
inefficiency.
To ensure that the policies and procedures are effective, the company may acquire internal
audit services. It can be through external sources as the company has no separate department that
organizes such responsibilities.

Phase 3: Reallocate Resources

As stated in Phase 1, change management is required to implement the strategy. With this,
the action of reallocating resources cannot be based on political factors or personal bias. Rather, it
should be based on clear analysis and thought. Packing Packers Inc. should be wary of a number of
factors to avoid substantial amounts of resources being wasted. To better streamline this, it can
procure enterprise resource planning systems. In the long run, the resource would not only be
beneficial for the training program strategy, but also for other aspects like sales and operational
management.
As for the specific resources to be utilized for training, this can be in the form of a learning
management system (LMS) for asynchronous modules and training simulation software for
assessments. The success of these resources will depend on the utilization rate and the completion
time of the trainees for a given timeframe.

Phase 4: Optimizing Feedback

It is easy to generate a new training program, but if training efforts are not evaluated, it may
be a waste of resources. Feedback is essential as it lets the proponents know whether their level of
effort is sufficient or needs to be increased. The performance of the training initiative can be
evaluated in terms of how worthwhile the participants viewed the training to be, how much the
participants learned, how well they are using their new skills on the job, and whether the training
program achieved its desired long-term results.
To ensure a comprehensive analysis on the actual program outcomes, its information
systems need to be effective. With its current stature, Packing Packer Inc. may explore various
software solutions that feature advanced data analytics tools. Cloud-based and purpose-built tools
can automate high-volume processes and analyze data in real time. It would be drastic and tedious
to manually capture and rephrase the intended meaning of the feedback should more stakeholders
get involved in the strategic initiative.

Financial Analysis
 It is crucial to consider the future financial landscape of Packing Packers Inc (See Appendix E
and F). To better understand this, the discussion will be dissected into three parts.
For revenues, Packing Packers Inc. will experience a growth decline in the first two years of
the forecasting period. Operational disruptions are likely to occur due to the company’s strong
emphasis and priority to change management and employee training. However, it will still manage
the demands of its existing clients through proper scheduling. The booming in figures will start after
the successful transition of the company, which is around 2 years. By that time, Packing Packers
would have completely revamp every business aspect, pushing them to navigate new ventures
within the industry. This justifies the sales figures in 2021 to be twice as in 2017.
For production and distribution cost, their growth from 2015 to 2017 is relatively the same
with the growth in revenues. With that, the first forecasted year will follow the same format. From
the third forecasted year onwards, the growth figures will be reduced by 0.25%, since Packing
Packers Inc. will likely be as efficient as possible in the supply chain. For the expenses of the training
initiative, it will belong to the company’s overall administrative expenses. In the first forecasted
year, its expense growth is relatively twice that of the previous year as most of the investments for
the program will be incurred at the said time period. From second to fifth year, justifications from
production and distribution cost will be followed.
As for operating margin, the company experienced a decline at the end of 2017. In line with
the stated arguments in the first two discussion portions, the drastic decline is expected in the first
forecasted year. This is relatively common to any company which is undergoing a change
management process and training. However, just like the old saying, high risk is linked to high
rewards. Essentially, the strategy suggests that the last four years of the forecasting period will
garner an operating margin of between 55 to 70 percent.

Risk Analysis
While the strategy is deemed effective, it is always important to consider a number of risks.
The creation of a Risk Assessment Matrix helps to facilitate this (See Appendix G).
For Phase 1, one of the most important facets to consider is employees' resistance to
change. It is simply human nature to counteract any changes and maintain the status quo. To best
mitigate this, the company can form a change management team to craft strategic approaches
supporting operational change and lead change management activities within a structured process
framework. Should the undesirable risk occur, the company may resort to delegating training
responsibilities to every department head based on its current structure.
For Phase 2, the formalization of policies equates to longer decision-making in a company.
With this, the company should obtain tools that make communication and information
dissemination smoother and more effective. In line with the back-up plan of Phase 1, the
contingency for this phase is to let involved departments to formalize their own policies in relation
to the training initiative.
For Phase 3, the action arises as an issue when there is limited availability of resources for
training. This is commonly rooted from poor forecasting methods and priorities set by the top
management. To avoid this, the team can list down all the activities and their corresponding
requirements. Then, it ranks them according to its importance. Should the undesirable risk occur,
the company may follow the original allocation plan for urgent and ongoing training encounters and
restructure activities based on the resources available left.
 For Phase 4, the team could possibly receive over-reactive response and disillusionment of
employees towards training. Employees tend to get overwhelmed with the sudden change, despite
being guided throughout the process. To lessen such responses, employees should receive guidance
throughout their training and support even outside of the workplace for increased morale. The
contingency for this phase is to incorporate ways related to all their agitations into the training
program.

Strategy Map
For the full strategy map and balanced scorecard, please refer to Appendix H. The strategy
calls for an efficient use of resources and investment capabilities to create optimal results for
Packing Packers’s training and development strategy.
The learning and growth objectives revolve around maximizing employees’ capabilities,
improving functional knowledge, and ensuring overall satisfaction and engagement. When
employees’ have the right skills and mindset, they can help the company sustain internal growth by
streamlining system processes, retaining the consistency in product quality and innovation and high
utilization of assets. From that, Packing Packers Inc. would be prepared in undertaking more
customer-based opportunities like product diversification and market penetration, which in the end
lead to the increase of cost-efficiency, profits, and market share. All of this translates back to the
three objectives statements for the company’s main problem.
 APPENDIX A: TOWS Analysis
TOWS Matrix Strengths
S1. Strong customer relationships
S2. Product innovation and personalization
S3. Unique approaches for production
S4. Market leadership position and wide
distribution network
S5. Consistent improvement in financial
performance
Opportunities Strength-Opportunity Strategies
O1. Growth in beauty and personal care industry S4-O2-03 = Follow the technological and
O2. Changing technological landscape (e.g. new environmental trends to improve public brand
machines) image and to maintain its advantage on product
O3. Growing favor for sustainability development
O4. Leadership stability
S2-S3-S5-O1 - Allocate budget to explore and
execute different product techniques for easy
penetration of the beauty and personal care
market
Threats Strength-Threat Strategies
T1. Strong competitors in the packaging sector S1-S2-S3-S4-T1 = Consistently capitalize on its
T2. Tenured employees own competitive advantages to outstand its
competitors
S2-S3-T1 = Offer similar or lower prices to its
unique, innovative and personalized product
options
Weaknesses
W1. No formal HR processes (recruitment &
performance evaluation)
W2. Tight control on daily internal functioning
and lack of long term planning
W3. Dependence on family members in
leadership positions
W4. Organizational structure misalignment to
job responsibilities
W5. Inefficient processes in sales and operational
management
Weakness-Opportunity
Strategies
W1-O3-O4 = Reduce overall recruitment
expenses by sourcing highly-skilled talent
through external sources for day-to-day
operations
W1-W2-W5-O2-O4 = Promote a flexible yet
participative working environment for employees
Weakness-Threat Strategies
W2-W3-W4-T2 = Implement an employee
training program through the help of higher-ups
(tenured employees) for competency level
improvement and process alignment
 APPENDIX B: SPACE Matrix

Competitive Position Industry Position

Product Quality -1 Ease of Entry +7

X into market

A Market Share -2 Profit Potential +6

X Stakeholder -5 Growth +6
I Relationships Potential
S Average: -2.67 Average: +6.67

Financial Position Environmental Position

EBITDA +7 Competitive -6
Pressure
Y
Inventory +2 Technological -2
A Turnover Changes

X Current ratio +4 Demand -2

I Variability
S Average: +4.33 Average: -3.33
 APPENDIX C: Advantages and Disadvantages of Alternatives
First Alternative: Staffing
through Recruitment Agencies
Second Alternative:
Participative Leadership
Third Alternative: Training and
Development of Employees
Advantages
● Fast recruitment and
screening duration
● Adequate knowledge of
agency specialists
● Improved work morale
● Reduced supervision cost
● Growth opportunities for
employees
● Better utilization of main
resources
● Consistency of employees
across business aspects
Disadvantages
● High economic cost
● Lack of cultural fit and
employer branding
● Loss of numerous
potential successful
applicants
● Increased likelihood of
conflict due to diversity of
ideas
● Diminished quality of
expertise
● Slow decision-making
● Time-consuming and
cost-heavy
● Too much of theory than
application
● Perceived as stress aside
from work responsibilities
 APPENDIX D: Alternative Solution Evaluation

Criteria Weights First Alternative Second Alternative Third Alternative

Rating Score Rating Score Rating Score

Company 35% 3 1.05 3 1.05 4 1.40

Performance

Organizational 30% 2 0.60 3 0.90 4 1.20

Culture

Corporate 35% 2 0.70 2 0.70 3 1.05

Sustainability

Total: 2.35 Total: 2.65 Total: 3.65

 APPENDIX E: Breakdown of Expenses for the Strategy

Materials Estimated Cost Schedule KPI

Phase 1: Aligning Consultation 400,000 Quarterly Positive change

with Services management
Organizational feedback
Design
Change 50,000 One-time N/A
Management purchase every 5
Resources years

Phase 2: Internal Audit 400,000 Quarterly Positive feedback

Formalizing Services on structured
Policies policies

Phase 3: Enterprise 2,000,000 One-time Achievement of

Reallocation of Resource purchase every 5 objectives in the
Resources Planning System years balanced
scorecard

Learning 500,000 One-time High utilization

Management purchase every 5 time and
System years completion
percentage of
trainees

Simulation 750,000 One-time High utilization

Softwares purchase every 5 time and
years completion
percentage of
trainees

Phase 4: Data 1,500,000 One-time Faster

Optimizing Management purchase every 5 information
Feedback System years process time

TOTAL 5,600,000
 APPENDIX F: 5-Year Financial Model Projection

ACTUAL DATA FORECAST

2014 2015 2016 2017 2018 2019 2020 2021 2022

Revenue 270,319,130 299,011,582 397,503,572 485,913,444 558,800,461 670,560,553 871,728,719 1,220,420,206 1,647,567,278

YoY 10.61% 32.94% 22.24% 15% 20% 30% 40% 35%

Cost of Sales 247,203,683 275,909,476 373,159,373 458,289,981 527,033,478 631,122,590 818,881,561 1,144,386,981 1,542,061,457

YoY 11.61% 35.25% 22.81% 15% 19.75% 29.75% 39.75% 34.75%

Gross Profit 23,115,447 23,102,106 24,344,199 27,623,463 31,766,982 39,437,963 52,847,158 76,033,225 105,505,821

YoY -0.06% 5.38% 13.47% 15.00% 24.15% 34.00% 43.87% 38.76%

Distribution
Costs 1,921,098 3,142,162 1,393,126 1,696,653 1,951,151 2,336,503 3,031,613 4,236,679 5,708,925

YoY 63.56% -55.66% 21.79% 15% 19.75% 29.75% 39.75% 34.75%

Administrative
Expenses 16,353,420 14,344,645 15,877,027 19,565,036 27,391,050 32,869,260 42,730,039 59,822,054 80,759,773

YoY -12.28% 10.68% 23.23% 40% 19.75% 29.75% 39.75% 34.75%

Profit Before
Tax 4,840,929 5,615,299 7,074,046 6,361,774 2,424,781 4,232,199 7,085,506 11,974,492 19,037,123

YoY 16.00% 25.98% -10.07% -61.89% 74.54% 67.42% 69.00% 58.98%

Income Tax
Expense 1,452,279 1,634,590 2,122,214 1,908,532 2,194,812 2,524,034 3,155,042 4,732,563 5,442,447

YoY 12.55% 29.83% -10.07% 15% 15% 25% 50% 15%

Profit of the
Year 3,388,650 3,980,709 4,951,832 4,453,242 229,969 1,708,165 3,930,464 7,241,929 13,594,676

YoY 17.47% 24.40% -10.07% -94.84% 642.78% 130.10% 84.25% 87.72%

 APPENDIX G: Risk Analysis Matrix

Prevention, Mitigation, &

Phase Risk Mitigation
Contigencies

Employees’ resistance to
1 structural change due to
operational disruptions
Delegate training
Develop a change
responsibilities to every
management team to
department head based on
achieve better transition
current structure

Acquire better
Hampered fast Allow each department to
communication tools for
2 decision-making process craft their own training
effective information
and innovation policies
dissemination

Follow the original

Limited availability of Prioritize areas within the allocation plan for urgent
3 particular resources for training initiative and ongoing encounters ad
training according to importance restructure future activities
based on recent availability

Over-reactive response Guide them throughout Accept all suggestions from

and disillusionment of the training initiative and the employees and
4
employees towards consistently support them incorporate them into the
training outside the training training program

Very Likely

Likely

Probable

Unlikely

Very Unlikely

Negligible Minor Moderate Significant Severe Impact

Impact Impact Impact Impact
 APPENDIX H: Balanced Scorecard & Strategy Map

Objectives Measurements Targets Initiatives

Financial ● Decrease
unnecessary
●
●
Net Profit Margin
Operating Margin
● Increase net profit
margin to 10%
● Effective Inventory
management
expenses ● Increase operating systems
● Increase profits margin to 10 %
● Increase market
share

Customer ● Offer variety of

product options
● Customer
satisfaction
● Increase customer
satisfaction to 95%
● Long-term and
equitable
● Expand customer ● Reduce customer agreements with
base complaints to 5% clients
● Geographical
expansion

Internal ● Streamline system

processes
● % of utilization
capacity
● Increase utilization
capacity to 95%
● Participative
regulatory audits
● Optimize business ● Minimize system ● Regular assessments
assets losses by 10% on system
● Retain product performance
quality standards
and innovation

Learning and ● Maximize

employees’
● Employee
satisfaction
● Increase employee
satisfaction to 90%
● Company
newsletters and
Growth capabilities ● % of trained ● Ensure more 75% of town halls
● Improve functional employees the employees to be ● Employee
knowledge fully-trained satisfaction surveys
● Ensure satisfaction ● Training and
and engagement development
programs