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    The last contemp project The last contemp project Document Transcript

    • ContentsINTRODUCTION .................................................................................................................................................. 3MISSION & VISION STATEMENT ..................................................................................................................... 3 MISSION ............................................................................................................................................................ 3 VISION ............................................................................................................................................................... 3NAME OF THE COMPANY ................................................................................................................................. 3GENERAL GOALS AND OBJECTIVES .............................................................................................................. 3SWOT ANALYSIS................................................................................................................................................. 3 STRENGTHS...................................................................................................................................................... 3 WEAKNESSES .................................................................................................................................................. 4 OPPORTUNITIES .............................................................................................................................................. 4 THREAT ............................................................................................................................................................. 4COMPANY IN FOCUS .......................................................................................................................................... 5 Who are the Stakeholders in ELECTOPOWER ENGINEERING................................................................. 5 Identifying our stakeholders ................................................................................................................................ 5 Impact of the stakeholders on the project ............................................................................................................ 5 Co-ordination with a geographically located team .............................................................................................. 5 Mode of effective communication with stakeholders ......................................................................................... 5 Advantages of managing stakeholder’s expectations .......................................................................................... 5 Disadvantages of not managing stakeholder’s expectations ............................................................................... 6Managerial / Leadership style ................................................................................................................................. 6 Authoritarian (autocratic) .................................................................................................................................... 6 Participative (democratic) ................................................................................................................................... 7 Delegative (free reign) ........................................................................................................................................ 7 Forces .................................................................................................................................................................. 8 Use of Consideration and Structure .................................................................................................................... 8Strategy Choices ..................................................................................................................................................... 9 INTERNAL STRATEGIC PROBLEMS IDENTIFICATION & ANALYSIS .................................................. 9 VERTICAL INTEGRATION ............................................................................................................................. 9 CERTIFICATION .............................................................................................................................................. 9 EFFECTIVE MARKETING ............................................................................................................................... 9 FOREIGN COLLABORATION....................................................................................................................... 10 HIGH CAPACITY ............................................................................................................................................ 10MANAGEMENT POLICIES ............................................................................................................................... 10 Pricing Policies ................................................................................................................................................. 10 Promotion Policies ............................................................................................................................................ 11 Distribution Channel Policies (Channels to Be Used for Distribution) ............................................................. 11 Human Resources Policies ................................................................................................................................ 11 Financing Policies (Sources & Uses of Funds) ................................................................................................. 11 Quality Management Policies (Quality system Principles & Management) ..................................................... 12 Environmental Policies ..................................................................................................................................... 12
    • Social Responsibility Policies and Code of Ethics ............................................................................................ 12 Customer Relationship Management Policies ................................................................................................... 12GROWTH STRATEGY ....................................................................................................................................... 12 Ideal Case .......................................................................................................................................................... 12 Likely Case ....................................................................................................................................................... 12Organizational Chart ............................................................................................................................................. 13COMPETITOR ANALYSIS ................................................................................................................................ 14PERFORMANCE MEASURES ........................................................................................................................... 14 (1) SHORTAGE OF RAW MATERIAL ...................................................................................................... 14 (2) QUALITATIVE DISTURBANCES ........................................................................................................ 14 (3) INTERRUPTION OF PRODUCTION .................................................................................................... 15 (4) SUB - STANDARD PACKAGING ........................................................................................................ 15 (5) COMPLIANCE OF DISPATCH ORDER ............................................................................................... 15CONTROL TOOLS THAT WILL BE USED ...................................................................................................... 15ANNUAL REPORT CONTENTS ........................................................................................................................ 15
    • INTRODUCTIONIn this report the complete analysis of Electropower Engineering Industry is explained. The completeprofile of our company is also illustrated through SWOT analysis. The competitor analysis and marketshare of Electropower Engineering is also discussed here. You can find all the preliminary analysis inthe below project.MISSION & VISION STATEMENTMISSIONOur customer loyalty is our profit & way of succession. So we trust on quality and customer trust on us and thebalance of this relation increases our market share day by day.VISIONWe will be the market leader in all segments of electrodes because we have the tools of succession.NAME OF THE COMPANYWe named our company as ELECTROPOWER ENGINEERING since we’ll be competing in Electrode Industry. Wechose this name since it reflects the industry and implies a Powerful image to the market.GENERAL GOALS AND OBJECTIVES The Welding Electrode industry in Turkey is a extremely large industry. It comprises of the manufacturing of electrodes used for arc welding. There are three broad categories of electrodes, differentiated by the rawmaterial used to manufacture each.1. General Purpose Mild Steel (GPMS)2. Special Purpose Mild Steel (SPMS)3. Special Electrodes (Maintenance, Stainless Steel, Cast Iron and Bronze).Turkey, as a fast growing economy with many investments on new construction projects, powerplant projects,docks, new building sites...etc needs giant amounts of electrodu industry products.Considering such a high demand, we want to reach our production and sales targets which we will update inevery 6 months. Our short term objective is to grow twice as big as we start the company today, and in the longterm we want to be the leader in the market which we want to achieve in 10 yeaTLSWOT ANALYSISSTRENGTHS High Capacity for Production as compared to other companies Well Reputation (With Regarding to Associated Companies) High Quality Low Price / Medium Quality Products Diversity Customer LoyaltyELECTOPOWER ENGINEERING will have the capacity to produce 7,000 tons per year as compared to othercompanies which are producing maximum 5,500 tons per year. So the company has full resources to become amarket leader.Being the part of ELECTOPOWER ENGINEERING Group (famous in diversified business of engineering), thecompany have the advantage of well reputation of its associated companies especially in institutional sector.
    • ELECTOPOWER ENGINEERING targeting the Gate & Grill segment which are more price conscious as compared toother segment. This segment only prefers the low price electrode and they don’t saw the quality of product. Sothe company will offer them low price electrode with medium quality.By giving medium quality on lower price the customers are prefer to ELECTOPOWER ENGINEERING as comparedto other brands. Because customer are satisfied with price and they also get quality product. So within a shortspan of time the company will succeed in getting customer loyalty. The customer loyalty will help the company toincrease the product line or to offer new brands.WEAKNESSES New entrance to the Market. There are already well known producers in the market. Unexperienced / Non Professional Management.The major weakness of ELECTOPOWER ENGINEERING is that the top management is unexperienced. In time weare going to be more and more experienced and professional as well, then no doubt the company will be amarket leader.The company is succeeded in getting the customer loyalty. It is easy to get the customer confidence but it ismore difficult to maintain it. So after getting the customer loyalty the company has to pay attention on the qualityof the product. Complaints can be received from different quarters about:OPPORTUNITIESThe demand of the company’s brand of Welding Electrode is very high in the market. If the company give fullattention and financing to this project it will take more market share from the competitors because people are stilldemanding for its brand because of its quality. The company have a good manufacturing capacity with which itcan fulfill the market demand since the company’s market is increasing by 11.3 % per annum for the WeldingElectrode. Currently demand in Turkey is over 30 Ton per year and it has a growth rate of 11.3% per annum. InTurkey at the moment the total production capacity of all the manufacturing units are estimated to be utilizingtheir full capacity.ELECTOPOWER ENGINEERING have the capacity and resources to also produce General Purpose Mild Steel(GPMS) and Special Purpose Mild Steel (SPMS). So it is the best opportunity for ELECTOPOWER ENGINEERINGEngineering to manufacture electrode for this segment also. To capture the share of this segment company takeadvantage from the reputation of its other associated companies.THREATImports are considered the greatest threat in this industry. The share of imports in the country’s totalrequirement was a healthy 40 % in 2010 - 11, which has rapidly declined due to capacity expansions and thesetting up of new GPMS plants by local manufactureTL Currently the imports only have a 16 % market share. TheGPMS industry feels threatened especially by the Chinese imports which in 2005 - 06 accounted for 69 % of thetotal imports by TL volume. The second largest import was from South Korea which had a 10.30 % share in TLvolume. Other significant imports were from Australia (4.39 %), Germany (3.55 %) and the USA (4.35 %). Theelectrodes imported from the western countries and South Korea are special purpose electrodes. The percentageof the imports of special purpose electrodes is not expected to decline due to the lack of technology in thecountry to manufacture them.Even the Chinese imports, which the local industry feels are a great threat, have declined. From the data one cansee that the Chinese imports enjoyed a very high share in terms of TL volume i.e. 94 %. But the increase in pricefrom TL 29697 per Ton to TL 40707 per Ton in 2007 - 08 decreased the Chinese share to 69 %. The decline inthe imports brought about by the increase in capacity of the local manufacturers may lead the localmanufacturers to charge higher prices because in the past due to the market presence of the imports the localindustry had no choice but to follow prices of the imports. Currently the average price of the local electrodes is TL96,000 per Ton whereas the average C & F price of the imports according to the Federal Bureau of Statistics`figures (Foreign Trade 2010 - 11) was TL 60780 per Ton which after custom duty of 70 % gives the retail price ofthe imports as approximately TL 105,000. Upon inquiry in the market the Chinese import was quoted to sell at TL119250 per Ton.
    • COMPANY IN FOCUS Who are the Stakeholders in ELECTOPOWER ENGINEERING1. Mustakeem Nadeem2. Seniz Pamuk3. Guntac Kaki4. ELECTOPOWER ENGINEERING Group (corporate Stakeholders) Silent Partner Our Company stakeholders are mentioned above who can positively or negatively impact the output of the whole project. It is very important for our efficient project manager to identify the names of stakeholders during the initiation stage of the project. Our stakeholders can be external and internal both. For examples ELECTOPOWER ENGINEERING Group our corporate stakeholders can be the customers, the clients, the project team members, the functional managers, the account managers, the operation managers, sellers, buyers, sponsors, etc. It is mandatory for our project manager to identify our stakeholders and manage their expectations throughout the life-cycle of the project. Internal stakeholders include Mustakeem, Seniz, Guntac and other managers or employees and are those that are situated within the company and affect the daily routine of the project. External stakeholders like ELECTOPOWER ENGINEERING Group are those who are not directly linked to the project but can influence the activities of the project through various ways. They include the Government, neighbors, pressure groups, political groups, local councils, and the surrounding communities etc. Identifying our stakeholders Ideally our project manager should identify the stakeholders at the initial stages as it will cost hugely if we missed out any key stakeholders during that period. As per PMI, it is an initiation process in communication knowledge area. Impact of the stakeholders on the project It can be very costly if we ignore any of the stakeholder’s expectations and it can hugely impact the project negatively like delay in deliveries. Suppose you need the resources for running the project as planned and if we have managed the expectations of HR manager positively then we will surely get a soft support from our HR manager because we’ve managed his expectations at the initial stage and the result can be vice-versa in case we have not managed his expectations initially. Furthermore, our project manager must manage the influence of all the stakeholders in relation to the project requirements to ensure a required output. The project manager should take care of the interests of the stakeholders balancing the requirements of the project. Co-ordination with a geographically located team If we are working with a team which is geographically placed then in that case ELECTOPOWER ENGINEERING should be aware of what are the best ways of communication with that team so that we can work effectively. And these things should be drafted at the initial stage of the project which should be communicated to them in advance in the required language. In this way we can manage a team globally without any trouble. We can save enormous time in our project through it. Mode of effective communication with stakeholders Our project manager should know the mode of communication and time of communication (in case of virtual team) of all the identified stakeholders. A well-discussed format of report (MS-Word, MS-Excel, Power point) can reduce the problem of communication a lot. So, our project manager should know the right format which the stakeholders require for viewing progress report, work status, trend report, etc. A lot of controversies can be reduced adopting these systems of reporting. Advantages of managing stakeholder’s expectations It is always plus for our project if we have successfully identified our internal and external stakeholders. Ideally, we should involve our key stakeholders starting from contracts, SOW, creating project charter (if our project manager is doing this) and he should involve in effective planning stages. As our project manager we should monitor their expectations regularly so that we can align the project requirements with their requirements. In the meantime, we have to maintain our milestone dates, quality planning, cost budgeting as a whole our performance baselines balancing the stakeholder’s expectations. If we are managing all these – our project are all right in every aspects. We can save time and money if we are managing the stakeholder’s expectations effectively.
    • Disadvantages of not managing stakeholder’s expectationsOur project can hampered effectively if we missed out any key stakeholders and their expectations. Thestakeholders are known as the skeleton for any project. We cannot run our project smoothly without theirinvolvement. In any case if we have missed out key stakeholders, we have invited trouble for our project. Theycan create a lot of unwanted trouble in our project. They can demand for an unacceptable scope change whichcan impact on pricing, timing, and the schedule. So, smartly we should define scope involving the keystakeholders so that we can monitor the scope effectively as per scope baseline. This is sure, if we have failed toidentify and manage the stakeholder’s our project will be over-budgeted and behind the schedule.Managerial / Leadership styleIn our company we use the Leadership style in a manner and approach of providing direction, implementingplans, and motivating our employees or workforce. The three major styles of leadership we use inELECTOPOWER ENGINEERING are: Authoritarian or autocratic Participative or democratic Delegative or Free ReignAlthough our Company leaders use all three styles, with one of them normally dominant, bad leaders tend to stickwith one style.Authoritarian (autocratic)I want both of you to. . .This style is used when our leaders tell their employees what they want done and how they want it accomplished,without getting the advice of their followers. Some of the appropriate conditions to use it is when you have all theinformation to solve the problem, you are short on time, and your employees are well motivated.
    • Some people tend to think of this style as a vehicle for yelling, using demeaning language, and leading by threatsand abusing their power. This is not the authoritarian style, rather it is an abusive, unprofessional style called“bossing people around.” It has no place in our leaders repertoire.The authoritarian style should normally only be used on rare occasions. If we have the time and want to gainmore commitment and motivation our employees, then we use the participative style.Participative (democratic)Lets work together to solve this. . .This style involves our leader including one or more employees in the decision making process (determining whatto do and how to do it). However, our leader maintains the final decision making authority. Using this style is nota sign of weakness; rather it is a sign of strength that our employees will respect.This is normally used when you have part of the information, and our employees have other parts. Even thoughour leader is not expected to know everything this is why we employ knowledgeable and skillful employees.Using this style is of mutual benefit to us and it allows them to become part of the team and allows us to makebetter decisions.Delegative (free reign)You two take care of the problem while I go. . .In this style, our leader allows the employees to make the decisions. However, our leader is still responsible forthe decisions that are made. This is used when employees are able to analyze the situation and determine whatneeds to be done and how to do it. We cannot do everything! You must set priorities and delegate certain tasks.This is not a style we use so that we can blame others when things go wrong, rather this is a style to be usedwhen we fully trust and have confidence in our people below our leader. However, we use it wisely!
    • ForcesOur leader uses all three styles, depending on what forces are involved between the followers, the leader, andthe situation. Some examples include:o Using an authoritarian style on a new employee who is just learning the job. The leader is competent and a good coach. The employee is motivated to learn a new skill. The situation is a new environment for the employee.o Using a participative style with a team of workers who know their job. The leader knows the problem, but does not have all the information. The employees know their jobs and want to become part of the team.o Using a delegative style with a worker who knows more about the job than you. You cannot do everything and the employee needs to take ownership of her job! In addition, this allows you to be at other places, doing other things.o Using all three: Telling your employees that a procedure is not working correctly and a new one must be established (authoritarian). Asking for their ideas and input on creating a new procedure (participative). Delegating tasks in order to implement the new procedure (delegative).Forces that influence the style to be used in our company include:o How much time is available to produce a flex wireo Relationships based on respect and trust.o Managers has the informationo Our employees are trained and they know the task.o They do surveys are introduce products in the marketo Internal conflicts.o Stress levels.o Type of task. Is it structured but sometimes complicatedo Established procedures such as OSHA and training plans are used.Use of Consideration and StructureTwo other approaches that our leaders use are:Consideration (employee orientation) our leaders are concerned about the human needs of their employees.They build teamwork, help employees with their problems, and provide psychological support.Structure (task orientation) our leaders believe that they get results by consistently keeping employees busyand urging them to produce.There is evidence that our leaders who are considerate in their leadership style are higher performers and aremore satisfied with their job
    • Also notice that consideration and structure are independent of each other, thus they should not be viewed onopposite ends of a continuum. For example, our leader who becomes more considerate does not necessarilymean that he has become less structured.Keeping the above in mind, it seems that some picture paternalistic behavior as almost a barbaric way of gettingthings accomplished. Yet, leadership is all about getting things done for the ELECTOPOWER ENGINEERING’sorganization. And in some situations, a paternalistic style of decision-making might be required; indeed, in ourcultures and individuals, it may also be expected by not only those in charge, but also the followers. However,when paternalistic or autocratic styles are relied upon too much and the employees are ready and/or willing toreact to a more consultative type of leadership style, then it normally becomes quite damaging to theperformance of the organization.Strategy ChoicesINTERNAL STRATEGIC PROBLEMS IDENTIFICATION & ANALYSISVERTICAL INTEGRATIONElectropower Engineering is the only manufacturer to backward integrate using wire produced by Power Steels (asister company) to manufacture its electrode. Other manufacturers also buy their wire needs from Power Steelsor Metal Steel. But none of the manufacturers are end users and vice versa. The threat of backward integrationfrom the manufacturers can be ruled out because the demand is dispersed with none of the major buyers buyingquantities that are large enough to justify cost saving through backward integration. Moreover the weldingelectrodes constitute only a minor portion of the costs of major manufacturers and fabricators and rather thancutting down on the electrodes costs they try to cut down on more obviously inflated expenses.Backward integration into flux manufacturing can be considered but the technology base is not available currentlyand the capital expenditure required in chemical Engineering is usually forbiddingly high.CERTIFICATIONThe buyers seeking quality in the electrode industry look for electrodes that are certified for users in a particularenvironment. There are institutions which certify that the product conforms to certain standards. The LloydsBureau of Shipping and the American Bureau of Shipping are two such institutions which qualify electrodes. Mostinstitutional buyers require the manufacturers’ products to be certified.EFFECTIVE MARKETINGThe electrode market is segmented according to the need of the end user in terms of quality and price. Themanufacturers adopt different strategies while targeting the different segments. A leading company like BOC sellsits premium priced product directly to institutional users but when it comes to targeting the low end of the marketBOC relies on its wholesale network in 14 district cities to sell the low priced range of electrodes. Thus thepremium priced high quality product is distributed selectively and the standard product is distributed extensively.
    • This two-pronged approach towards targeting the market has proved successful for BOC and it has been able tosustain sales due to institutional support even when sales in low end market were jeopardized by price cutting bycompetitors. Thus, aggressive institutional selling and extensive reach ensure success in this market.Electropower Engineering have only one sales office for its distribution, so the company try to enhance theirwholesale network into other cities.FOREIGN COLLABORATIONThe electrode manufacturing process is a moderately technical process. Manufacturers like PAWEL, BOC, Sencan,Diamond and Electropower setup their projects with technical collaboration, because the technology is notindigenous. This technical assistance ensures the quality which is required to substitute imports. Besides itthwarts competition from those local manufacturers who are not technically assisted. BOC Turkey is amultinational entity backed by British Oxygen U.K., PAWEL was setup under a license agreement with WeldingEngineering of Oerlikon, Switzerland. Shanghai and Diamond have Chinese collaborationElectropower Engineerings will have the technical collaboration of Kyoto of Japan. Thus the major manufacturersrecognize the need for technical help in order to produce a quality product.HIGH CAPACITYIn view of the rising demand of electrodes in the country the company with the greater capacity will not onlyachieve economies of scale but also gain a greater share of market, making inroads into the already recedingimports.The highest capacity lies ironically with Electropower Engineerings which has the lowest market share for the firstyear, but we plan to increase it and be the market leader in five years.With demand having outgrown the combined local capacity, the successful manufacturer is one who has theforesight to expand now in order to reap the benefits from a growing market in the future.MANAGEMENT POLICIESProduct Definition & Product Features Electropower Engineering company management has done imperative work by diversifying the entirebusiness portfolio in a manner that will facilitate the organization to maximize its profitability margin. Themanagement needs to look into all its raw materials and determine the manner through which substantial goalsand targets will be realized upon purchasing or obtaining all the raw materials. The organization main rawmaterials are Steel wire rod, Brass wire rod, Compound of chemicals (Flux) and coating agents and Potassiumand soda silicates. Product is one of the integral aspects within any organization that has motive of maximizingprofitability margin. Electropower Engineering company should tap in ideas to articulate on ways and approaches throughwhich it will be in capacity to accomplish all goals and targets within the shortest time possible. For instance,product policy in any business set up is always concerned with issues relating to design and how marketingperformance can be diversified. The organization should be thus in capacity to product policy complies withdesign, branding aspects and quality. This approach would be of much importance given the fact that thecompany has been venturing in production of many products that conforms to international standards. In manyworld electronics markets, many issues and aspect required to determine the manner through which marketdiversification will be arranged or equipped. In every market product features forms the basis through which anorganization is able to continue maximizing all its returns. It is through the same approach that ElectropowerEngineering Company will be able to maximize its customer’s base through ensuring that all planned policies thatrelates with the product have been realized within the appropriate time frame.Pricing PoliciesPricing Principles- Competition, Cost, Value Electropower Engineering Company has also perfected in the realms of pricing policies. Themanagement has been in capacity to look into obstacles that have been limiting the organization towardsrealizing all its goals to a parameter whereby it maximizes profitability level. There are three key and integralapproaches within pricing that Electropower Engineering Company should always regulate and maintain in aneffective area. These are the value, cost and completion that are being witnessed in the product realms. The
    • organization management should be in sound capacity to ensure that all set goals and targets are compatiblewith all the market plans. This is the guiding principle through which the organization will be in capacity to fosterconsiderable completion to all its fierce market rivals. Many of these measures are wholly concerned with themanner through which the organization will be in reasonable capacity to continue maximizing its marketapproaches. Electropower Engineering Company should also ensure that its entire workforce is in capacity ofproducing quality electrodes that comply with the value which is all acceptable in the entire market. Theorganization should thus target all potential markets whereby it has a tendency of encountering imperativecompetitive position of its products. For instance, the organization Arc welding Electrodes have been animperative to manufacture products which have been used in all areas of engineering. Its steel fabrication hasbeen used to structure fences and grills. It is also through the organization diversification of producing theproducts that has led the organization into promoting the growth of Auto industry in Turkey .Promotion PoliciesCorporate Communication, Advertising, Sales Promotion Electropower Engineering company management should also be in imperative capacity to ensure that itis able to maximize all the plans in the right approach. In fact, it is through this approach that the organizationhas been in capacity to facilitate export potential all over the market place. Most of the markets that theorganization has tapped are concentrated in Central Asia, European countries, Middle East and Africa. This hasbeen one of the most implemental areas whereby promotion policy of the organization has been witnessed asfruitful in both short and long term. All Electropower Engineering company promotion policies should be organized in a manner whichenhances business continuity to unenforceable future. For instance, the recent entry of new plants in the marketis a wakeup call for the organization management to expand its promotion tactics. Electropower Engineeringorganization management should also be in capacity to review the three companies which are New light House,Sana Welding and Diamond Weld Electrodes on how they are carrying their businesses. It is through thisapproach that the management will be able to choose the best strategies of improving its promotion mechanismDistribution Channel Policies (Channels to Be Used for Distribution) Electropower Engineering Company has been performing well within the parameters of production sinceits launch in Turkey. One of the key factors that have enabled the organization to continue maximizing its goalsand targets is the fact that it has been able to coin imperative distribution channels in its entire occupied marketapproach. The products that have continued to facilitate its expansion are General purpose Mild Steel (GPMS),Special Electrodes (Maintenance, Stainless steel ,Cast Iron and Bronze) and Special purpose mild steel (SPMS). The management should plan and also hypothesize effectively on the cost of its three basic materialswhich are the Bonding glue, Flux and Wire. This will enable the promotion team to apply the best policy that willbe in situation of maximizing the profitability margin in the market. Promotion is one of the effective policieswithin any management of an organization. It is through it that the organization is able to rationalize all its goalsand targets in a manner that is imperative. The management should also look into the various aspects thatfacilitate its diversification in the market place. According to statistics the largest operating cost within the entireindustry is the raw materials which have been proven to be at a level of 70%.Thus, in distribution of products theteam or department responsible with this entire role should check in ways through which all intended objectiveswill be achieved.Human Resources Policies Human resource policies are under another area which is hugely important especially in parameters ofrealizing all inclusive goals of Electropower Engineering Company. It is through this approach that all imperativegoals and targets will be realized. The organization should forge a powerful human resource department whichwill be in capacity to ensure that recruitment, Promotion, Training, Empowerment and Performance appraisal areall well put under consideration. Electropower Engineering Company should come out clear as an equal opportunity employer. It isthrough this channel that the management will be in capacity to carry out imperative recruitment, training andpromotion strategies. This is one of the key and fundamental approaches which will position the organization in aposition to realize all its articulated goals and targets in the right parameter.Financing Policies (Sources & Uses of Funds) For every organization to prosper in all levels of its operation, long lasting imperative plan should bestressed within the areas of financing. In this area Electropower Engineering should be able to locate all thenecessary ways of financing its business portfolio. In circumstances where there is insufficient of sources of fundsall business operations cannot be accomplished as planned. Thus, it is through this approach that theorganization is able to perfect in all the parameters. The management of the company should review all themethods that are important in the areas of achieving goals and targets in the right approach through ensuringthat financial parameters have been consolidated. This is important in this area where competition in the market
    • has increased. It can source its funds from leading banks .This will enable the organization to foster imperativediversification in all areas concerned.Quality Management Policies (Quality system Principles & Management) Quality management policies are vital towards ensuring that Electropower Engineering has built aconsiderable name in the entire market. It is through this approach that the organization will be able to maximizeand at the same time comply with all the demands of the markets. Quality system and Management facilitates anorganization to coin a sound and solid name with its customers. This is because all issues and concerns of theclients are always looked into and solved accordingly.Environmental Policies Electropower Engineering management should also focus on ways and approaches that will steer theorganization forward towards realization of all solid and quality goals in the market place. Environmental policiesare integral to this organization given the fact it experiences massive emissions of byproduct substances in theenvironment. Thus, the management should look into ways on ho w to mitigate the problems and in resultcomply with all the market factors that are within the environmental perspective.Social Responsibility Policies and Code of Ethics An organization such as Electropower Engineering which deals with large production of products shouldalways look on ways through which it will be able to maximize its entire profitability margin. Due to its high levelof pollution the organization should also be much vigilant on issues pertaining to social responsibilities policies. Insocial responsibility Electropower Engineering should focus on how to fund various kinds of projects in thesociety. In this approach or initiative it will have been able to handle all the issues within the parameters of thecustomers, suppliers, employees, society and all other areas that touch social responsibility policies. Thisapproach will have enabled the organization to coin a reputable name with all its stakeholders in the market.Customer Relationship Management Policies Customer management policies are important in the organization accomplishment of its core marketobjectives. It is through customers that the organization is able to sustain itself in the market. In times like nowthat there is an entry of three other organizations in the market Electropower Engineering should find the waysout on how it can be in capacity to relate well with its entire customers.GROWTH STRATEGYIdeal CaseFor this we may assume that the tariffs on the finished good will remain at the current levels and the duty on theimport of wire and flux is withdrawn. The wire constitutes almost 70 % of the weight of the electrode in GPMSelectrode and the flux constitutes about 30 % of the weight, whereas in terms of value they contribute almostequally to the cost of goods sold. Currently the ITP value of wire rod is STG. 210 per ton (Rs. 29,400 approx.). Sothe decrease in duty from 65 % to zero would translate into a decrease in the price of wire of about 37 %.Currently all wire needs are bought locally so this measure would encourage the import of wire from abroad as itwill results in cost savings of nearly Rs. 15,000 per ton. Moreover the removal of duty from the Rutile Sand whichis the major constituent of the flux will result in the prices of flux being lowered by almost 12 %. Together thetwo will decrease the cost of goods sold by almost 25 % thus raising the current margins by almost 15 %because the COGS is approximately 70 % of Sales.Likely CaseFor this case we may assume that the current situation holds true. The duty on the flux and finished good wouldremain at the current levels and the slashed duty on the wire rod will encourage imports of the wire which giventhe current ITP value of STG. 210 per ton will cost Rs. 12,600 per ton after a duty of 20 % and other charges ofabout 8 %. This would mean a decrease in the price of wire of about 26 % which translates into a decrease inCOGS of about 13 %. The margin in this case will improve by 6 - 7 % but not as substantially as in the ideal casebecause the flux would still be imported under the previous duty structure.
    • Organizational Chart
    • COMPETITOR ANALYSISThe competition in the electrode industry is intense. There are 11 different local manufacturers. Themajor manufacturers along with their locations and their approximate capacity are listed ahead.Name of Manufacturer Location Capacity (Tons / Year)BOC (Formerly Pak Oxygen) Izmit 5,500PAWEL Izmit 3,000 - 3,500Riza Engineering Industries Izmit 4,500 - 5,000Electropower Engineering Istanbul 7,000Diamond Weld Electrodes Kayseri 4,500 - 5,000Sencan Industries Izmit 3,000 - 3,500New Light House Istanbul 2,000Sena Welding Ankara 1,000Total 32,500 Ton per year.Three other manufacturers, Premier Engineering in Izmit, Castle Engineering in Gebze,PERFORMANCE MEASURESThe first year expected market shares of the companies are estimated as below:Company Share of MarketRiza Engineering Industries 18 %Electropower Engineering 8%Diamond Weld Electrodes 20 %Sencan Industries 5%New Light House 25 %Sena Welding 16 %Others 8%The factors leading to periodical and year to year variation are trying to explain as follows;(1) SHORTAGE OF RAW MATERIALPeriodical shortages of Raw Material (especially Steel Wire Rod) with the result that goods are notavailable in sufficient quantities to cater for the need of dealers.Reasons best known to the management.(2) QUALITATIVE DISTURBANCESComplaints received from different quarters about: Crack in the Welding parts. Bad irritation smoke. Color change (flux). Center out. Automatic flux shedding.
    • (3) INTERRUPTION OF PRODUCTIONConstant interruption and production and non dispatches have adversely affected the business resultsin deterioration of goodwill of the company as well, which was earned by the company with greatlabor and efforts during the last year.(4) SUB - STANDARD PACKAGINGProper attention and due care is not being given for packing material (Cartons) it tears, duringhandling and packet scatter here and there. The strapping matching was almost out of order and itwas in working position.The strips were always loose; because of this dealers were losing interest in selling our Electrodes.(5) COMPLIANCE OF DISPATCH ORDERThe compliance of dispatch order is not being made in accordance with the demand of dealers, but ingenerally met as per stock available at that moment. This procedure does not satisfy the parties andneeds to be made as per orders.The company’s low pace of fulfillment is so much discouraged the parties that they are reluctant toplace fresh orders and hesitating to give further advances but are also urging for return of theiradvances.CONTROL TOOLS THAT WILL BE USEDAfter we have spent our money, financial statements will reflect how much was spent, how it wasspent, and what it obtained. The managers should use financial statements, such as an incomestatement or balance sheet, to monitor the progress of programs and plans.We should closely look atspecific figures that are liquidity ratios, profitability ratios, debt ratios, and activity ratios.The other control tool will be budget. We will use flexible budgeting in which managers adjusts thestatic budget for the actual level of output.Other than that, we can apply marketing statistics which measure profitability, activity, market sharesand sales quotas.To make sure that we have efficient and effective human resources, we will includeperformance appraisals, disciplinary programs, observations, and training and developmentassessments.Last but not the least, Electropower Engineering Group has some confidential and sensitiveinformation that we dont want to become general knowledge. Controlling access to computerdatabases is the key to this area.ANNUAL REPORT CONTENTS1) PROJECTED BALANCE SHEET2) PROJECTED PROFIT & LOSS ACCOUNT3) PROJECTED CASH FLOW STATEMENT4) ANALYSIS OF INCREASE / (DECREASE) IN CURRENT ITEMS OTHER THAN CASH5) NOTES TO FINANCIAL PROJECTIONS6) DEPRECIATION SCHEDULE YEAR 17) DEBTS SERVICE COVERAGE RATIO8) FEED BACK & SURVEY REPORT9) TEST REPORT OF WELDING ELECTRODE10) MEETING WITH DEALERS