Sandalias Finas de Cuernavaca S.A.
... waste of time and energy. The company needed to rearrange the floor plan of the plant. The arrangement of each department should allow all materials flowing in simple and fluent way. At the same time, the arrangement also should satisfy each internal customers and suppliers in the downstream producing process. Secondly, lots of small orders, re-orders and emergency orders disrupted the manufacturing process and increase the operating costs too. For the reasons, the company has to analysis customer profitability. The managers need to know each component of the profit equation (revenue, costs, business volumes) in terms of the respective customers and customer groups in order to know the profit contributors and loss-maker, and then determine actions to convert those loss-makers into profit contributors. In this way, the management could figure out how to maximum the company’s profit and customers’ satisfaction. Thirdly, high in-process inventory level was another factor. The level of inventory, 13 percent of total annual production, was a glaring problem of the company when facing the foreign competitors. High level inventory not only added the producing cost but also lead to big discount sale due to stuff out of fashion. The reasons of high level inventory mainly came from the unreasonable and disordered operation process. For example, the cutting procedures were separated on two floors, which meant the worker had to run up and down to finish the cutting process. Another potential reason was the company was absent from timely and reliable statistics on inventories on hand and unit sales of product by inventory managers. In result, the productivity is decreased and work-in-process is accumulated. Finally, the company lacked of low-priced quality components. The purchase of top quality shoe components made it difficult for the company to offer products in low price and high quality compared with its foreign competitors. Employees lack education and participation In Mexico, comparing to developed countries, the existing educational system is still on the way to improving, even though, the government is augmenting the national education level. The average level of formal education of workers in the plant was lower than the level in Canada or United States. It is difficult to train employees with lower education level to enroll in high efficient producing process. In addition, Mexican education system and culture background are the main factors which result that employees are lack in involvement and empowerment in their companies. Father and teachers are undisputed authority in Mexico. People grow in the environment may be short of questionable mind and problem-solving skills in workplace. They like to completely obey a decision, even if they do not agree. There seldom were new ideas and suggestions from employees and interaction between employees. Therefore, without full participation of each employee, it was hard to continually improvement the company’s competitive advantages. TQM’s cultural assumptions The frist assumption is that employees feel an important relationship between them and the company they work for. In this way, employees naturally care about the quality of products. As long as they are provided with the tools and training that are needed for quality improvement, and management pays attention to their ideas. They will improve quality initiatively. The second assumption, the each department of the company is interdependent, interactand good at team work. Then high quality products are produced efficiently since internal customers and suppliers are all satisfed. For example, product designers must address manuf...