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Birmingham Vending Company Incorporated: Challenges For New Management

1067 words - 5 pages

Introduction
Birmingham Vending Company Incorporated’s new owners are dissatisfied with the company’s fiscal performance and have hired a new leader to improve profitability (About us, 2011). Before being replaced, Bob Greenwood – Birmingham’s founding owner – led Birmingham with an innovative approach to gaming and video amusement machine design, eventually achieving 30 percent market share. Greenwood’s replacement – an accountant – recently interviewed the production and marketing managers in order to understand the company’s challenges but is unsure of how to improve the Birmingham’s fortunes. The new leader needs to reconsider Birmingham’s objectives and transform the company’s ...view middle of the document...

” Greenwood’s greatest talents were his innovative design and his ability to deliver the newest technology in fashion forward devices. Greenwood, therefore, also sought to be a technological pioneer and design trendsetter: he recognized that the emerging video entertainment market demanded the newest products and supplied these accordingly.
Birmingham’s current challenges – production
Birmingham’s production manager is focused on a developing a mass process approach to production as confirmed by his goal of lowering unit costs and improving assembly plant efficiencies (Slack, Chambers, & Johnston, 2006). Improving mass process operations may result in improved profitability by lowering per unit costs if efficiencies can be identified in the production line. Unfortunately, these objectives do not align with Birmingham’s customers who demand the latest technologies and innovations but who are not particularly price sensitive. Birmingham’s new leader needs to communicate with the production manager to ensure that he recognizes that the company’s success is based on continuous innovation rather than cost minimization.
Birmingham’s current challenges – marketing
Birmingham’s marketing manager wants the company to focus on offering a continuously refreshed line of highly reliable products that can be quickly delivered to customers. The marketing manager’s objectives are to market innovation, reliability, and nearly instant product delivery. Birmingham’s marketing operations are project or jobbing process oriented (Slack, Chambers & Johnston, 2006). Innovative businesses deliver profitability by being market leaders in the latest products and services. The marketing manager’s objectives are consistent with Greenwood’s original approach to business – success through innovation - that resulted in the company’s early success.
Birmingham’s current challenges – new leadership
Birmingham’s new leader has been hired as a change agent. He spent his first day of employment touring the company to understand its process design. He then criticized the staff. This approach may be wrong: a leader cannot completely understand a company in a day (Bass & Avolio, 1993). As a newcomer to Birmingham, the new leader needs to understand the company’s early successes in order to plan the company’s future. His objectives should be to understand the firm and to realign its processes to improve profitability.
Recommendations
Birmingham was a successful company under Greenwood’s leadership. After Greenwood sold his company, the entertainment industry evolved and the video gaming market emerged, but Birmingham failed to evolve. Birmingham’s new owners and leader need to review the...

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