The Widgets R Us case study is a case with a problem of how the company is set u

Question

The Widgets R Us case study is a case with a problem of how the company is set up and how the company will handle operations with its projected growth. Answer the following questions:

You have been called in as a consultant to analyze the operations at WRU. Based on the readings, what would you advise Widgets R Us to do in order to sustain the competitive advantage in the widget market?

What structural design changes might be undertaken to improve the operations at the company?

Case Study 2.4: Widgets R Us

Widgets R Us (WRU) is a medium-sized firm specializing in the design and manufacturing of quality widgets. The market for widgets has been stable. Historically, WRU has had a functional organization design with four departments: accounting, sales, production, and engineering. This design has served the company well, and it has been able to compete by being the low-priced company in the industry.

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In the past three years, the demand for widgets has exploded. New widgets are constantly being developed to feed the publics seemingly insatiable demand. The average life cycle of a newly released widget is 1215 months. Unfortunately, WRU is finding itself unable to compete successfully in this new, dynamic market. The CEO has noted a number of problems. Products are slow to market. Many new innovations have passed right by WRU because the company was slow to pick up signs from the marketplace that they were coming. Internal communication is very poor. Lots of information gets kicked upstairs, and no one seems to know what happens to it. Department heads constantly blame other department heads for the problems.

Explanation / Answer

Lack of communication has led to several problems including delayed response to market signals. Apart from that it seems WRU has not been paying the required attention to marketing and market research. The widget market is exploding and to remain competitive only a low price strategy will not work. To stay ahead and to remain profitable in the market, first of all it would need to pay attention to market research so that it can pick the demand signals early and respond to them. Therefore, WRU needs to pay special attention to market research and establish a department for it. Another important factor is that despite making full efforts it would not be able to make profits if it does not pay attention to project management and proper communication among the various departments.

In fact WRU would need to keep project management at the centre so that it can communicate easily with every department and neither the projects would be delayed and there would be any discrepancy between market demand and the supply. If the sales and marketing department are directly linked with the projects department it would be easier to market the products as well as to read the market signals and plan projects accordingly. Another major benefit will be that in this way the different departments will not be working independently but in alignment towards achieving the common goal. This will also solve the issue of communication to a great extent. To improve the operational efficiency and communication across the organization, WRU needs to keep projects department at the centre and link it with every department which can report directly to it. Otherwise, if production, engineering and sales departments are not aligned the company will continue to fail at catching the market signals and responding in time. For consistent performance and operational efficiency the company would need to realign its departments with the projects department.

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