Stahl is a global market leader in chemicals for the leather industry. Today, Stahl operates 8 manufacturing sites and 30 strategically located technical service laboratories around the globe including here in Singapore (www.stahl.com).
The role I posses is hybrid in nature where I am not only accountable for sales targets of certain South East Asia countries but also oversee the development of higher quality and more economical products to our current product range. As a Technical Advisor in Stahl, I am considered to be a Front-Line Manager (Bartol, Tein, Matthews, Sharma, Scott-Laden, 2011, p. 13).
The problems we faced are that our customers are complaining that our prices are too expensive as they are able to source for cheaper and yet, better products from our competitors. Basing on my customer interactions and company reports (Stahl Asia SEA Analytical & Market Report 2012, p.15-36); we have lost as much as 20% of our business to our competitors over the last 12 months. We had to change something to how we manage our business, to be competitive and still maintain our position and profit.
Bartol et al (2011, p. 72) has explained, like any other company in the world, Stahl is surrounded by 2 external environments. They are the General or Mega-Environment where many companies have limitations in changing or altering it directly. As Davidson, Simon, Woods, Griffin (2009, p.150) points out, the impact of the environment are often vague, imprecise and long term. Thus many organisations majorly tend to focus on the Task or Specific Environment where managers can identify the environmental factor of interest to their company and influence it to their advantage.
Stahl has mainly the Competitor, Customer or Supplier to contend within our specific environment but Supplier was chosen, as this was the main element that was causing our market share to be lost. This essay will explore how the Supplier has impacted the way I Plan, Organise, Lead and Control within my organisation. Both Bartol et al (2011, p. 77) and Davidson et al (2009, p. 152) have defined that suppliers are companies or organisations that provide resources such as raw materials, products or services for their day-to-day operations.
This element specifically impacts my organisation because we were having too many suppliers that gave huge variances in quality in the raw materials acquired. Sudden surges in production also meant that costs went up due to expensive airfreight charges to facilitate our production. This often meant that part of the costs was often passed on to the customer who is already unhappy about paying more for our expensive product. Something had to change.
Even though I am not involved with higher management and their strategies, it was through the company meeting reports (Stahl Asia Review & Actions 2013) and interaction with my immediate manager that I understand we have reduced from 10 to 2 suppliers. This streamline is vital as they can commit to the price we want as we are able to buy in bulk on a regular basis. The quality supplied can be assured as our raw material comes from a reliable source. Furthermore, our supplier is willing to keep a certain amount of raw material in their warehouse should our production decides to surge, at no extra costs. With all this planning in action, this allows us to price our products competitively without harming our profit margin. This in turn in the long run it will enable us to not only regain back our market share but also expand it.
The supplier’s element has impacted my job from a Planning, Organising, Leading and Controlling perspective in the following ways.
Planning as pointed out by Davidson et al (2009, p. 13) is the setting of the company’s goals and deciding the best way to achieve them. Being a First-Line Manager (Bartol et al, 2011, p. 13) meant that I am not involved with the higher planning of strategies but was advised on it through my immediate manager. It meant that I had to understand the goals of the company which was to develop new products using the raw materials from our 2 suppliers.
Organising according to Campling et al (2008, p. 20) is the importance of assigning tasks, resource allocation and the arranging coordinated individuals and groups to execute plan laid out by the management. My manager has assigned the Quality Control (QC) and the Reseach & Development (R&D) teams to support me in achieving our goal of producing a new product with our supplier.
Davidson et al (2009, p. 6) mentions that Leading is a management function that motivates & influences others through means of communication and managing groups of people. The daily work interaction with the QC and R&D teams allows me to exercise another set of management skills known as Human Skills (Bartol et al 2011, p.12) that enables me to motivate my team to the required levels of change. With this it also meant I inherently took up the role as what Mintzberg (1980) defines as a leader.
Bartol et al (2011, p. 6) explains that managers must take initiative to set and compare standards and if necessary, take corrective action. Thus in Controlling, Davidson et al (2009, p. 14) states that it’s the final management process whereby the company monitors its progress towards its goals. Even though my developed product maybe finalized and have met the standards set by us. I still had to have the product tested by my customer in order to ascertain if it’s acceptable for them.
In conclusion, by understanding the problems we faced in losing our business, my company reacted by changing one of the Specific Environments that has the most effect to us, the Supplier. It was the one that we could best change and improve our situation. Hence this change has led me to Plan, Organise, Lead and Control within my organization and as I was a First-Line Manager, I found myself leading most of the times to achieve our company goals.