FAIR-MEAD MARINE Case Solution
Mr. Fair’s constant interference in the production schedule is one of the major supply chain issues being faced by the company, delaying the delivery of products in time. Minor problems cause production to halt and leave little time for long-term planning. Furthermore, the interference of Mr. Fair is also result in the de-motivation of the staff which leads to the underperformance of their key staff. As a result of this frustration and irritation the staff turnover might increase at Fair-Mead which undermines the credibility of the work done by the staff, which ultimately leads to the poor profitability of the organization as a whole.
Another major issue that had arisen was related to a relatively small scale supplier but had become a significant matter since, the supply chain manager, Morales had to take a tough decision as to whether to let go of him or take a risk by keeping him. Mr. Sharma was taking longer to fulfill the urgent orders as he had run into some problems of his own. The gap between the supply of Sharma’s materials and assembling of the products was causing a major issue for the company. Moreover, Mr. Sharma's fittings were not according to the specifications that had been mentioned, having used lower quality materials instead of the one ordered, thus jeopardizing the company’s endeavor to produce the most superior quality products. Mr. Sharma faced an interesting dilemma that is; he could either provide the desired quality within his timeframe or supply on time but compromise on the quality. Miss Morales faces a challenge since; Sharma has the potential to grow into one of the major suppliers for the company which is why it would be a loss to let him go, while on the other hand continuing work with him with the same results could smear her reputation.
Root Cause Analysis:
The major supply chain challenge faced by the company is the timely delivery of its products accompanied with the high quality that it promises to its customers. The two most important issues that have been identified include the following:
- Fair’s micro-management followed by his decisions taken without any input from others that sometimes involve, changing the specifications. These decisions do not get communicated to the supply chain either.
- Sharma’s reluctance to fulfill the orders within time. His materials that included, Bimini tops and other coverings had to be made of stainless steel and provided with short notice, but since Mr. Sharma had now established his company and had other lucrative offers as well as prospects including new product lines, for which he was willing to terminate the contract with Fair-Mead. Mr. Sharma is trying to increase its range of suppliers so that the Boat Parts & More inc cannot rely on just a single large customer. It can be said that the management of Fair-Mead fails to gain the confidence of the suppliers which indicates the poor performance of Fair-Mead.
A small sales team is also one of the major hurdles being faced by the company. Fair Mead, apparently wants to expand its operations and extend to the Ontario region as well as increase its export sales, which is not possible with a sales team comprising of only two people.
There is no evidence of a customer care system being implemented by Fair Mead, which goes on to increase its problems. In the absence of a warranty provided by the company, Fair Mead has to look towards its suppliers to get its problems solved.If it initiates warranties to its customers, the challenge can be met more efficiently on its own, while compensation can be demanded from the suppliers at a later stage.
The value chain of the company that produces the different boat models completely relies on suppliers for the procurement of the most core boat components, which is an inherent weakness in its design, allowing vendors to exploit the company to their benefit.
Due to the nature of the highly sophisticated niche that is being served by Fair Mead and its requirements, it would be perilous to compromise on any of the essential product elements that are, quality, design, and performance. The company’s reputation might suffer if the company continually allows the gaps in the supply chain to exist.
Another observation that can be made is that the supply chain partners are not working in collaboration, the way they should. This situation is also worrisome, and Miss Morales must focus on efficiently solving this issue by bringing them together, for the elimination of pertinent problems.............................................