Concept Design Services Case Study

CONCEPT DESIGN SERVICES Azalia M Indra | Rizki Nasibah | Kurnia Khafidatur | Helmina Ardiyan MM Reguler 13

CASE FACTS

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Over a 10 yer period CDS Totally transform the outlook, resources, and prospects. From being an inward-looking manufacturing company become a custumer focused, integrated service provider. From largely commodity supplier, CDS have become known for value added and innovation designs James Thompson is CEO of Concept Design Service (CDS). Concept Design Service (CDS) was believed to be one of Europe’s most profitable plastic household products (‘homeware’) bussiness 1960’s CDS had changed the name as Focus Plastics, the company growth had come initially from the manufacture of complex injection-moulded plastic components for large industrial customers. It had rapidly extended its range to include populas household items such as washing-up bowls, pedal bins, baby baths, bucket and dustpans. These were solds under the Focus brand name. By the early 1990s, the homewhere business had grown to account for over

CASE FACTS(continued) The Products • 1989 the company produced around 200 homeware stock-keeping units (SKUs), and had developed a reputation as a reliable source of supply of consistently high-quality product. It was then decided to withdraw from the complex and cyclical industrial mouldings market in order to concentrate on delevoping the more profitable household products business. • According to CEO, by 1990 all our industrial business had been terminated

CASE FACTS(continued) Market Positioning • Linda Fleet as CDS’s Marketing Director, joined the company in early 1990’s. Previosly worked in a senior marketing role for large retail chain of paint and wallpaper retailers • First new range of kitchen items was launched in 1992, under the “Concept” brand name. Within one year, we had over 3000 retail outlets signed up, and provided each with point of sale display facilities and high quality brochures. • CDS’s research indicated that some customers kept our products on display in their kitchens as object beauty, or even as tokens or symbols of their lifestyle, rather than hiding them away in cupboards. • For Concept brand name, the company start focused on design of the product. Make any item in any color. • To keep ahead, CDS continue to launch

CASE FACTS(continued) Manufacturing Operation • All manufacturing was carried out in a large, leased, modern facility, which was located approximately 20 km from Head Office • The factory had areas for receiving and holding raw materials, and the moulding area include 24 large injection-moulding machines • The most recent had robotic devices to remove finished products from the machines to place them on conveyors leading to the packing area • Products, and individual components of product, were moved to thhe packing area, where they were assembled and/or labelled (where required), inspected, packed in bags or cartons and palletised.

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The Supply Services Department of the Company was regarded as the heart of the company’s customer service drive, to integrate the efforts of design, manufacturing and sales., it has two functions : – Plan and Schedule production in order to maintain inventory availability – Plan distribution of products from warehouse to customer.

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Sandra White, (Supply Service Planning Manager) responsible for the scheduling all manufacturing and distribution and for maintaining inventory levels for all warehouse items, prepared performance reports, monitoring the utilisation of equipment, output rates for each product and scrap rates. Linda Fleet did not often fell the need to intervene in the day-to-day workings of the department, preferring to concentrate on the more innovation orientated activities of the Marketing Department Relative autonomy allowed Sandra to optimise the planning throughout the internal Supply Chain. Try to establish a preferred sequence of production of each machine and mould. To minimise set-up times,

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Careful scheduling is important to maintain utilisation, The factory is usually not scheduled for weekend production, and maintenance is usually performed on Saturday mornings. with the wider product range, now at about2500 SKUs, this was somewhat inevitable The pick rate help to measures the availability of finished goods inventory, Everything would be fine if we were able to stick to schedules the market is dynamic and continual schedule changes affect utilisation, efficiency and scrap rates. Certainly better marketing forecasts would help….but even our own promotions are sometimes organised at such short notice that we often get caught with stockouts Concept products are much more seasonal, which makes capacity planning and scheduling very difficult at peak times around November (for the Christmas gift markets) and Easter The Mould Machine comes from Korea’s Suppliers , this mould offer a high quality but Cheap price It usually takes around 4 to 5 months to get a new mould, which then has to be trial

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The “Concept Office” Design House brand had been introduced in late 1999, and was perceived as a very successful entry into a new market, employing many of the marketing ideas developed with the Concept household range. Linda Fleet saw an increasing role for collaborative arrangements. “It may be that they are seeing a fundamental change in how they do business within their industry. CDS had several partnerships with the Italian design houses, and they are most successful companies of Italian design. So they got the patent of their design so their manufacturing department made the same design. and they were able to translate the most difficult technical design into manufacturable & stable products.

PROBLEM STATEMENT •

Problem :

-The market is dynamic and continual

schedule, changes affect rates. Certainly better .marketing forecasts

utilisation, efficiency and scrap would help - But, our own promotions are sometimes organised at such short notice that we often get caught with stockouts. • “Most of our time is spent planning the production and delivery schedules for Concept products, which involves a vast range of moulded parts, boughtin components, packaging, and finished goods • The Biggest Problem in this Supply Service Department , there is a lack of management to produce the product brand both Focus and Concept.it is caused by The Demand of Marketing are so Dynamic. And the Factory are too crowded, to produce both brand. • In Conclusion, Supply Service Department just able to produce 98% from the Demands. • For Focus Brand, it is show High Income, for a production and distribution, but the risk are also high. If this company can’t afford the demand of Organization Consumer, the highest loss would be received.

QUESTIONS 1. How successful have Concept Design Services’ strategies been since the decision to exit the industrial products market? 2. In what ways have the marketing strategies affected the activities of the Manufacturing Operations and Suply Services departements? 3. What have been the main features of the strategies adopted by Manufacturing and Supply Services during the 1990s? What operations-based competitive advantages were developed under the influence of these strategies? Were the strategies clearly developed or did they evolve, or both? 4. How might the development of the design house and major retailer services markets affect the operation of the Manufacturing and Supply Services departements? More specifically, what new capabilities may be required to serve these new markets effectively and profitably? 5. What changes, if any, would you recommend for the business to continue its growth in sales and profit?

ANSWERS 1.

Since the decision to exit the industrial products market Concept Design Services (CDS) have increasing in income and company’s profit. Concept Design Services (CDS) was in B2B business and then it transformed into B2C business. It would be identified that the industrial markets were becoming more difficult with very less profit. They have two plans for supply services first is plan & schedule production in order to maintain inventory availability. Other is distributes the product from the warehouse to the customer. Just in 1 year they had over 3000 retail outlets signed up and provided each with point-of-sale display facilities and high quality brochures. Productivity improvement. They normally allow 3 shifts for testing of each new module received In the supply services. So, this strategies are affected to the marketing operations & supply services. 2. the marketing strategies affected the activities of the Manufacturing Operations and Suply Services departements with : •. The large range of products were moved to packing area, where they have modified or labelled. •. The most recent Robotic device to remove finished Goods to place for Packing Area. •. Products was inspected, packed in bags or cartons & palletized. •. Good Platform access to load delivery vehicles. To Plan & Schedule Production in order to maintain Appropriate inventory Availability. Then systematic study is done for distribution of Products which is from warehouse to Customer. With Those Way, Company can Increase the efficiency of production process, so it

3. The main features of the strategies adopted by Manufacturing and Supply Services during the 1990s are already have skilled and experienced labors to maintain new larger machines easily who formed industrial product. With drawl from complex and cynical industrial mouldings and concentrate on household products. •. In 1990 all the integrated business was terminated, because they can’t stand with other competitors, so then they had high focus on relatively new market with a small numbers of competitor ( blue ocean strategy) It was widely enforcing on customer focused service, from B2B To B2C with a name brand of “ Concept” which provide a unique and beauty household. •. Supply services have two plans, they run both of that, 1)-Maintain appropriate inventory & 2)-distribute the products to customers. The Result’s show the increasing of the sales company and the whole strategy was a reason of great success for the company.

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The development of the design house and major retailer services markets that affect the operation of the Manufacturing and Supply Services departements had several partnerships with the Italian design houses, and they are most successful companies of Italian design. So they got the patent of their design so their manufacturing department made the same design and they were able to translate the most difficult technical design into manufacturable & stable products. This type of collaboration involved CDS taking responsibility for the whole category of plastic home wares for a large supermarket group. And the product ranges supplied were not particularly adventurous in their design or colors but most were clearly in the “CONCEPT” style and often carried the concept brand. •. CDS had a good marketing capabilities but they have to design new products aspect from the only kitchen appliances like they have to come up into the furniture & another designing field so maybe they can get more effect on market & make profit also.

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The recommend for the business to continue its growth in sales and profit is stay focus on their main business, because a good company , is accompany who has 3 characteristics,one of them is Going Concern or focus on their main business. CDS have a good design in the kitchen appliances. And it was a one of the best company of kitchen appliance at that time. According to the example case from Linda Fleet, Same Design from design product is not growing more than to years, So, as per the example CDS have a great design in the kitchen appliances but they have make consist change in design with the innovative idea. this change will help them to continue its growth in sales & profit.

The Importance of Operation Management for CDS Objective: • Add Value of their Final Product • Products Productivity improvement (design value) • Customer Satisfaction Improvement • Competivity Improvement

Examples • Apply the technology in aerospace sector onto home ware items • Expanded into a premium product Market (High Quality & High Design Value • Integrating new functions with its operations.

The Latest Condition of Concept Design Service

• Nowadays, this companys, are still existing, but with a new office and home design solution.

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